Business Travel Through the Ages: A Journey from Phoenician Traders to Modern Jetsetters

Business Travel History:-

How are the Phoenician Trader selling oil and pottery all over the Mediterranean a pronounced 13 century Merchant Marco Polo and now a leady departing to the business conference related they are all corporate travelers.

?

Corporate travelers

Corporate travel is just a new name for something that existed since the dawn of time as soon as people realized they could exchange goods and services with other cultures they started boarding ships and loading their caravans. Today? business travel is done very differently though the purpose remains the same it’s the opportunity to explore new markets build stronger connections with your client find new ones and negotiate the rules of cooperation even though for a few year most of the travel was shut down and many of us adapted to doing business over zoom corporate travel prevails there are benefits to in-person interactions and getting similar minded people in the same room which is why in 2023 companies have spent over 70% of pre-pandemic level on business travel and that without mentioning blending travel multipurpose business trips or hybrid work that expanded our understanding of?what it means to travel for business lets’ talk about the fascinating history of travel for

?

The History of Business Travel: -

The form of in which business travel exists today is fairly new and was established just a few decades ago but its roots go further back to the 19th Century, as with many things in life it all started with the Industrial Revolution a lot changed from the end of the 18th to the beginning of the 20th Century. There were always professional Salespeople but with the increased scale of production and a bigger need to sell and transport Mass-manufactured Goods. The demand for them grew too thanks to the rapid development of roads and railways, distance was no longer a problem when it came to sales so vendors could be mobile moving between cities in search of clients for a relatively small cost covering larger territories and taking orders regardless of the geographic area.

The development and transportation also meant that more people could attend fairs Expos and trade shows. this was the ultimate form of advertisement where you could introduce to the public the new farming equipment you‘ve developed or show off the state of the art and technology that not many have seen before such inventions as the telephone dishwasher and X-rays were debuted at one of these events the attendance to them was so massive that it soon necessitated. The increased construction of hotels and other infrastructure in the world’s largest cities. Trade fares played a crucial part in the development of business relationships and economic cooperation so there were certainly a place to be if you wanted to hire a vendor or find new clients or investors.

Since travel itself was only beginning to be modified, there wasn’t any clear difference between business and leisure Travelers. The substantial changes happened during the next big wave of business travel development with the growing popularity of flying.

?

?The Birth of Jetsetters: -

The 1950s and 60s are considered the Golden age of air travel technological advancements led to the introduction of larger faster and more comfortable Boeing 707 and Douglas DC8. Thanks to the new jet engine planes could now cruise at speeds exceeding 500 to 600 mph more than the piston engine aircraft, this cut the duration of transcontinental and transoceanic travel by several hours. Improved aircraft capabilities allowed airlines to offer long-haul flights to more distant destinations opening new opportunities for both Leisure and Business travel by 1972 almost half of all Americans had flown at least once. Though due to high prices, regular flying was still a domain of business travelers. When the famous Concord was introduced in 1969, offering to get you from London to New York in just 3.5 hours. Business travelers were its main customers, you could get across the Atlantic Finalize your deal, and come back in just one day. So, they were practically the only group of Travelers who could justify the Cost. It was easy to get used to the glamour of flying in its golden era gourmet meals attentive staff and elegant Airport lounges were there to support the notion that flying was the mode of transportation for the most successful and important people. So, when the Glamorous era in travel had come to an end, Airline tried to keep the VIP treatment for extra pay.

?

The Business of Business Class: -

The idea of a distinct class of service for businesspeople was formed in the 1970s. Traditionally there were only two service classes in Airlines, First and Economy. For some time, there was no middle ground. So in the 1970s Airlines started introducing an intermediary option where passengers could have a better level of service and be separated from the rest of the crowd the names of this third Service as well as configuration were changing constantly and were different for every airline but one thing was in common. Companies like getting those seats for their employees.

Then compromised class was not as expensive as first class but not as cramped as economy. To make the distinction between all classes, more airlines introduced sleeper seats to First, first-class got business class recliners with more legroom and kept economy the same even before the title business class stuck it had become an important part of Air travel affordable to anyone seeking a more elevated experience.

If you are from any big company, you can probably afford to pay extra for your employees’ comfort but doesn’t it get very expensive? How do you control the expenses and manage how each employee spends corporate money?

The first to recognize this, new need for expense management was American Express, Travel was not a new market for AMEX back in 1891 they started issuing Travelers checks not a concept they created but one they developed the most. These were checks for a fixed amount of money in local currency that people could use abroad instead of cash. This was safer than carrying large sums of cash and for a few decades it has become one of the main ways to make money on vacation. In 1915 they opened their own travel agency, organizing tours to all parts of the world including the first-ever around-the-world passenger cruise in 1922. It goes without saying that when in 1966 American Express introduced the corporate credit card, specifically created for business travel they knew what they were doing.

The main idea behind the corporate card was helping the company monitor employee spending. Traveling, has many travel-related expenses from flight tickets and accommodation to meals and entertainment. Of course, the company must compensate the employee for any related costs. Sometimes business travelers pay for such expenses out of pocket and then submit the expense claim to receive compensation. In other cases, they use the corporate account. The second option is of course much more convenient. No time is spent submitting and checking invoices and employees don’t have to anxiously wait for a reimbursement but if you choose this path you need to make sure that your people don’t do too much or use the card on unapproved transactions. How do you do that? AMEX allowed companies to issue a card to each traveling employee. All expenses would come from a single corporate account, but managers could set up restrictions and rules of usage for each card. For example, an executive would likely be authorized to spend more per transaction than a middle manager. Over the next few years American Express expanded the capabilities of the corporate card enabling businesses to manage costs even more conveniently there was analytics reporting software for rule change and many more. Not all corporation switched to AMEX though many continued asking their employees to input expenses into Excel sheets in the best-case scenario and for a few decades this remained the standard way of managing travel expenses. This was a frustrating time for Road Warriors. Imagine having to save any paper receipt and proving to your supervisor that you need reimbursement for the sandwich you bought when your flight got delayed.

?

Going Paperless:-

In 1993 one of the first travel expense management tools emerged, “Concur” was a web-based platform where employees could report their travel spending. The idea was to abolish the need to carry heaps of receipts. With the appearance of smartphones expense reporting became somewhat easier now employees could prepare reports on their phones take pictures of receipts and submit expenses to the cloud as soon as they happened. This led to the rapid innovation and emergence of more “travel and expense” management software also known as T&E for shorts. Such companies as Immerse “Trip Actions” " now known as NAVAN and Egencia appeared throughout the 2000s although they originally provided tools for expense reporting. They soon grew to become something bigger.

Today T&E tools typically offers end to end expense management including travel reservations and integrations with core business software. Employees can book their own hotel flights or car rentals on these platforms get their expenses automatically checked and even be issued virtual credit cards. Many companies rely on T&E software to manage business travel, they are self-service and easy to integrate so they are enough for many cases, yet not all organizations want to manage all travel-related activities themselves. Sometimes they need help and support from 3rd parties, someone who knows more about travel. We are talking about a Travel Management Company.

?

TMCs: The New Normal in Corporate Travel

A Travel management company or a TMC is often called a travel agency for corporations. Basically, TMCs arrange travel on behalf of their business client, this includes booking flights and hotels, organizing insurance, taking care of Visas, travel risk management on trip assistance, and reporting after the trip is over. Most large businesses today employ a TMC to run travel operations for them. One of the oldest TMCs is “CWT”, whose contribution to the travel industry goes back to the 19th Century and with roots in some of the oldest travel companies in the world. The first one Wagons-lit was founded back in 1872 by a Balgian civil engineer Georges Nagelmackers, after visiting America in his youth and having enjoyed train travel on PM carriages he returned to Europe and started his company creating dining and sleeping cars or “Wagon lit” in French. The company internationals Wangon-Lit gained prominence as an operator of the legendary Orient Express and decades later was merged with another historical travel brand Thomas Cook. It’s business travel arm called “Wagon lit travel” became the first business travel agency in Europe.

The 2nd company was a travel agency founded in St. Augustine, Florida being one of the oldest towns in the US. St. Augustine attracted a lot of tourists Ward G Foster, who owned a Bookshop across the street from a hotel often shared his knowledge of train timetables with the town visitors. Legend has it that whenever someone asked the locals about train arrivals and departures, they were told to just ask Mr. Foster. He decided to transform this into a business. Which became one of the oldest and largest travel agencies in the US changing its name to “Carlson Travel Network” .

So in 1997, just in time to introduce the world to Corporate Travel management Carlson Wagonlit Travel appeared, and formed the merger of Wogonlit and Carlson Travel Network. Today it’s simply known as “CWT”. This long and complicated history of two innovative companies became an ideal background to shape a whole industry around. After Carlson Wagonlit travel similar businesses emerged including BCD Travel, FCM Travel, and AMEX’s own Travel management company called American Express Global Business Travel, the latter has grown into such a giant that in March’24 it announced acquiring CWT for a little over half a billion dollar. So this is where we are at now.

Now you may ask yourself a question in a world where the need for traditional travel agencies subsided and people learn to book travel Independently, how come businesses still use intermediaries like TMC? Why don’t they just create a travel Department that would do all travel planning in house?

?

Why use TMCs?

Some companies do have their own operations, corporate travel intermediaries remain relevant for a few reasons.

1st- TMCs partner with travel providers. They know how you can spend your money most efficiently and help create your own portfolio of Airline and accommodation providers with special discounted rates.

2nd – TMCs are experts in the field of Travel. Most companies are not equipped to handle potential threats that can happen to a traveling employee. So wherever and whenever an employee is stuck in an airport due to a canceled flight, loses a passport or experiences any other troubles, TMCs have a dedicated customer support team to find a solution and help the person out.

3rd -TMCs provide technology for travel reservations, reporting, and many more including an integration with your expense management tool. Basically, when it comes to something so complex, expensive, and indefinite as travel you want someone to be your guide.

Business trip planning is a complex task. You basically send a person on a mission and must take care not only of the logistics of the trip but also of financing and employee wellbeing, at the same time the standards of traveler’s safety and convenience are constantly increasing. Corporate travelers expect more than their counterparts from a century ago. The company treats them with expensive seats and high-quality amenities to make sure that employees arrive rested and satisfied to be able to do their jobs well to coax people from their home offices come. Companies started offering a combination of leisure and business travel like giving extra paid time off or the freedom to invite their spouse to join the trip. Another interesting development in the business travel sphere is something called super commuting. Since many organizations have been hiring employees in faraway locations, they sometimes want to bring them to the office to meet the rest of the team such trips are very different from traditional corporate travel and require different policies and rules. So, this is something businesses still need to figure out.

It's fascinating to see how companies continue seeing travel as an important part of their operations. Something that can’t be easily replaced with digital avatars or low reses pictures of your colleague on the screen. Let me know what other aspect of the travel world you’d like to learn more about.

?

Sources: [01]?https://www.gbta.org/global-business-... [02]?https://airandspace.si.edu/explore/st... [03]?https://www.americanexpress.com/en-us... [04]?https://www.travelweekly.com/Travel-N... [05]?https://ec.europa.eu/competition/merg... [06]?https://www.bcdtravel.com/https://www... [07]?https://www.amexglobalbusinesstravel....