DMCs are facing increasing pressure from clients who request tour and incentives proposals only to go direct to suppliers in a bid to cut costs, according to travel specialists attending Euromic’s annual general meeting in Cairo.
The situation has worsened over the past year due to the effects of sluggish regional economies which have crimped corporate and business travel budgets.
Sara Merino, director of sales and marketing at Spanish Heritage, said the problem is becoming increasingly commonplace with clients wanting to arrange incentive travel to the UK.
“Proximity is an issue,” she said. “They think because England is so close they can do it themselves. So they contact us and then take our ideas and go direct to the hotels (and other suppliers). It’s very frustrating.”
Furthermore, it is difficult for DMCs to add value simply by reducing the cost of accommodation, which remains one of the most expensive components of an incentive programme, due to the slim discounts offered by some hotel groups, she said.
Alexandra Heemskerk-Teyema, director of Delta Amsterdam Event Management and Destination Services, said her company had faced similar issues. “However, over the past six months most (clients) have come back. Maybe they had some bad experiences (trying to do it themselves).”
Gloria Spotti Hinch, executive vice president of Events.COM, said travel specialists should be more confident about charging conceptual fees as a deterrent against clients who request multiple proposals simply to gain ideas and supplier contacts for free.
“We (successfully) charge for the concept,” she said. “If a client wants us to develop a programme for them, why should we do that for free? It costs us time and money.”
However, corporate buyers and incentive houses attending the Euromic event said they have not seen DMCs charge for proposals, adding that if a company does so its bid would likely be rejected.
