What they lack in size they make up for with their flexibility, quick decision-making, simple travel policies and processes, need for minimal account management and potential for growth.

It’s no wonder that working with SMEs has considerable commercial appeal for travel managerment companies. “Often operating to a flatter structure with less head count allows relationships to be formed and the ability to adapt to changes without layers of red tape,” says Leanne Fowler, Director of Account Management at Clarity.

Having a mix of clients, rather than depending on bigger, high-value firms, also mitigates risk as losing a large-spend enterprise would leave a sizeable hole in the bottom line. “SME business is considerably lower risk, especially as all conceivable customer segments and verticals can be targeted, reducing volatility,” says ITM CEO Scott Davies.

Onboarding is quicker as there are no lengthy procurement processes or rate negotiations and they can be targeted directly by suppliers.

Loyalty is another attractive characteristic, so too their ethos, adds Cassie Petrie, MD of SMB EMEA at SAP Concur.

“SMEs are innovative and have big ideas. They’re looking to expand or make a difference in their industry,” she says.

The lure of the SME also extends to increased profitability as they can generate higher margins than enterprise clients, explains ITM’s Davies. “The key reason is the high discounts that high-volume accounts are able to negotiate in return for committing their support. Due to the large number of SME clients that suppliers transact with, touch points must be minimal so account management and other engagement costs are light.”

In short, what’s not to like? It’s no wonder that TMCs and suppliers woo this sector with a range of benefits such as easy booking, discounts, simple account management, loyalty schemes and scalable solutions.

That hasn’t always been the case, but John Stephenson, Managing Director at Your Travel Corporate, has seen suppliers moving beyond the one-size-fits-all travel solutions.

“We have seen suppliers offer better one-on-one support for fare and rate loading as well as offering higher level advice on how to use their offerings, the likes of which were rarely offered before.”

What’s in a name?

But who are SMEs? Establishing a definition of these lucrative buyers is challenging since it varies greatly depending on which part of the business travel triangle you ask.

Frasers Hospitality has seen growth in particular markets: “SMEs are a fast-growing segment of the global business economy – particularly in sectors like finance, tech and creative industries,” says Rebecca Hollants Van Loocke, COO EMEA.

“In the travel management world, the definition of an SME is often fluid,” adds  Inntel CEO Douglas O’Neill. “For some TMCs and suppliers, it’s based on spend – typically anything under £5m might be classed as SME. For others, depending on the size of your own business, an SME may have an annual travel budget below £1m or even under £500,000,” he says.

In the mid-size TMC sector, an SME is defined by a travel spend of £100,000 to £3m at Blue Cube Travel, but at Clarity it’s any travel spend under £1m, while at Take2Eton Group the annual SME spend range is £150,000 to £1m.

The same disparity in definition is found within suppliers. Lufthansa classes SMEs as those companies with a corporate revenue in tickets spent with an annual volume of less than €50,000 a year. South Western Railway says it’s those with an overall travel spend of under £2m. At Virgin Atlantic, SMEs can start earning loyalty points with as little as a £5,000 annual spend.

Premier Inn doesn’t classify SMEs by spend but by dynamics, explains Tim Sleep, Sales and Distribution Director and Head of B2B. “[SMEs] have certain common attributes, such as price sensitivity and being time poor. They can range from a one-person company up to 30 people or more and we are continually challenging ourselves to stay relevant and offer value.”

Regardless of their size and spend, SMEs have leverage. Frasers’ Hollants Van Loocke advises “not to underestimate the value of your business, even if your travel volumes are modest. It’s always worth having a conversation, even without a formal programme in place”.

Preferential rates, flexible terms and a dedicated contact to manage your account should all be on the table. Technology has also evened the playing field and tech solutions can grow with the company. What is key is to “share data and establish travel policies that are set in concrete,” advises Joe Thurgood, Business Sales Manager, South Western Railway.

Rather than dealing direct with suppliers, improve clout around the negotiating table by gaining access to volume-based deals and discounts when individual spends are grouped together by a TMC. “More importantly, a TMC can negotiate value-adds, such as hotel rates that include breakfast, parking, early/late check-in, and wouldn’t be tied into big deals that do not add value,” says Shelley Matthews, Chief Commercial Officer, Take2Eton Group.

Premier Inn’s Sleep advises booking in advance and avoiding the busiest business days of Tuesday and Wednesdays to gain a better deal. “Booking a Sunday or Monday night can make a significant difference on the rate. We always encourage our business travellers to treat Monday as the new Tuesday if they want to benefit from even better value.”

Two-tier system

Rather than consolidating all your travel with one TMC, consider fractional travel management if your VIP/C-suite travellers have more complex/more white glove travel requirements to other travellers.

“We work with a number of accounts that use our VIP service for their C-suite, while using a large TMC or online TMC for the rest of their workforce, who usually have more straightforward travel requirements,” says Take2Eton Group’s Matthews.

Travel Counsellors advocates the same strategy. ”Global travel managers increasingly recognise that one size does not fit all,” says Melanie Quinn, Director of Corporate Travel. “While high-volume, transactional travel may often be managed in-house or via online booking tools such as our self-booking tool, myTC Online, executive travel calls for something highly bespoke, with an approach that’s agile, discrete, personal and care-led.

“In many cases, companies are now procuring specialist support for senior-level travel in the same way they might separate out meetings and events from the core programme. These engagements allow us to step in as an extension of the in-house team, delivering high-touch service where it matters. Through this tailored approach we build trust, demonstrate value and often form the foundations for a longer-term partnership as the client’s needs evolve.”

The need for cost control, sustainability reporting and duty of care is driving another trend, to move from unmanaged to managed travel. Surprisingly, not all are small accounts. Take2Eton cites the example of a reinsurance client with an unmanaged account worth over £2m.

The good news is that today, the business travel market provides bespoke SME support because it makes good commercial and strategic sense. “Suppliers that get this right are embedding themselves in the DNA of tomorrow’s midmarket giants,” says Stephenson of Your Travel Corporate.

Read on for how suppliers are targeting SMEs.

Airlines

Etihad

Etihad doesn’t offer a specific corporate travel programme for SMEs but they are targeted in the airline’s new digital portal, Etihad for Business. Buyers can track performance data in real-time, handle benefit redemptions and access their complete corporate travel management suite through a single digital platform. Key features include automated performance reports, transparent tiering requirements, streamlined contract management. Corporate customers can now access contract details, monitor travel spend and redeem Etihad for Business credits for a comprehensive suite of travel benefits.

Virgin Atlantic

Accounting for 55% of its customer base, Virgin has a big push on SMEs. A dedicated sales team supports the sector, including social selling on LinkedIn, and promotes its Blubiz loyalty programme where travellers can earn and burn across four airlines (Air France/KLM/Delta and Virgin,) on a minimum of a £5,000 annual spend. Perks include dedicated check-in, wireless charging on board, and invites to key events.

Lufthansa

The German airline defines SME as spending under £50,000pa. Typically they are enrolled in the free, self-service PartnerPlusBenefit (PPB) loyalty programme which allows travellers to earn points on flights and redeem for free flights, upgrades and other benefits. SMEs can also utilise BusinessToGo (BTG), a direct booking platform introduced in collaboration with Navan to direct book, collect and redeem PPB points, insert policy and manage bookings.

Accommodation

Frasers Hospitality

SMEs account for 50% of clients in the EMEA region and they can join the Business Travel Programme with a minimum of 50 room nights a year, per property in return for discounts, flexible cancellation policies (up to 48 hours before check-in), a central booking portal for easy reservation management, free Wi-Fi and loyalty rewards through Fraser World programme. “Where larger clients may require bespoke rate agreements and multi-property contracts, our SME offering is designed to remove complexity,” says Rebecca Hollants Van Loocke, COO EMEA. “It gives smaller companies live self-serve access to high-quality serviced accommodation and corporate travel perks without the pressure of large-scale commitments.”

Hilton

Hilton for Business is an SME-specific programme offering a booking platform, portfolio-wide discounts across its global portfolio of nearly 7,400 properties and accessed on the website and Hilton Honors app, loyalty rewards from Hilton Honors, and programme management tools to track upcoming spend, review historical spend and understand the benefits accumulating as they travel. “It meets their unique set of needs and reduces friction points, from booking to billing,” says Chris Silcock, President, Global Brands and Commercial Services.

Premier Inn

SMEs account for more than half the total B2B revenue, over £500m, and are “really significant and critically important to us,” says Tim Sleep, Sales and Distribution Director and Head of B2B. That gives SMEs access to a free business platform, which gives 5-15% discounts on bookings across every night of the week to the chain’s 850, three-star hotels, a six-week credit limit and various reporting modules including leakage and cancellations.

Ground Transport

South Western Railway

SMEs are categorised as those with overall travel spend of under £2m and account for 30% of SW Railway’s client portfolio. SMEs can take advantage of its rail booking tool Business Direct which allows users to book tickets on any train operating company on the network and track bookings (reason for travel, customer name). It is supported by a dedicated team and claims an average of 24hrs for refunds. ”We make the difference when it counts,” says Joe Thurgood, Business Sales Manager. “We like SMEs. They are flexible and open.”

Trainline

SMEs are those with a rail spend of under £500,000. Knowing that they prioritise ease of use, cost efficiency and flexibility in their travel solutions, Trainline offers Trainline Business, an intuitive self-service tool with scalable features, allowing effective travel management control without the overhead or complexity of enterprise systems. It includes travel policy settings to promote savings, sustainability reporting and traveller profile management. “SMEs bring agility, diversity, and innovation to our client base as they’re often early adopters of technology and highly engaged in improving efficiency,” says Sophie Fleming, Global Head of Trainline Business.

Ancillaries

Holiday Extras for Business

This new sub brand of airport ancillary provider Holiday Extras provides a one-stop-shop to fill the gaps around core travel products, including parking, lounges, Fast Track and transfers. It is also trialling currency exchange. Booking is via the TMC and OTA networks. ”It’s currently either pay-as-you-go or book on account on a portal but we’re looking at a tech integration in 12 months’ time,” says Kayleigh Dawkins, Partnership Development Manager. She wants these ancillaries to be part of a travel policy rather than expense policy where it’s “out of sight, out of mind”.

Travel and Expense Management

SAP Concur

Two-thirds of the company’s customer base is SMEs and its “universal offering” of Concur Expense and Concur Travel can be used in a simple, user-friendly way. It provides an app for employees and ensures cost control and visibility for the employer. “The great thing about our universal offering is that you can add pieces of SAP Concur into the app to suit your needs,” says Cassie Petrie, Managing Director of SMB EMEA. “If an SME travels a lot, you might switch on Concur Travel or TripLink. If compliance matters, you might switch on the audit function. The platform can grow with the SME.“