While companies in China’s big cities recognise the value and quality global travel management companies (TMCs) bring, many still see the need to continue using the services of local travel agencies for certain types of transactions.

Cost is the underlying reason, where using global TMCs tend to be significantly pricier compared to the local travel agent. But as new restrictions are imposed and new trends emerge in the market, even companies with small budgets are looking at the value of TMCs with global reach.

Revlon Shanghai deputy general manager, public relations and legal, Mr Sean Guo, said: “Price is a huge consideration. When it comes to our top-level executives where nothing must go wrong, we would use highend TMCs such as American Express (Amex) because there is a guarantee, and we believe they would only choose the best hotels and airlines as their preferred partners. “But for sales managers we would use the local agency because they are much cheaper.

“It also depends on the size and complexity of the trip or meeting. For example, we had a regional meeting in March of 400 of our executives from all over the world. It cost about 20 per cent more (using a TMC) and we had to pay a deposit upfront, but it was worth it because they gave us a lot of value as the cost included multiple changes to complex itineraries and meet-and-greet service at the airport, which was helpful as it was the first time to China for some of them. They could also issue the tickets from any part of the world, which saved us a lot of money.”

Trane American Standard Company purchasing assistant, Ms Sophie Li, who is based in Shanghai, said: “Our TMC partner in the US and Europe is BTI but it is not as established in many cities in China, so we still have to use local agencies. Amex has operations here but it is more expensive than our present arrangements. In addition, our overseas offices have used BTI for a long time and they are satisfied with their service so there are no plans to switch.”

Ms Li said Trane’s managers and those more senior spent an average of US$6,000 per trip and they each made 30 to 50 trips a year. She was unable to say what the total volume was.

Revlon Shanghai’s travel budget in China is not large, only about US$130,000.

Mr Guo said the company spent half of it with Amex and the other half with local agencies, as the latter had access to last-minute air ticket offers that they sold on a cash basis. But this is set to change as more restrictions have been imposed on such deals.

“Our travel budget will be increasing and because of the new regulation, I think we will be spending at least 10 per cent more with Amex. We also plan to participate in the new credit card programme Amex recently launched in China,” he said.