Group CEO, Reed & Mackay

The Business Travel Magazine - - The Conversation - Andy Hoskins

One of my first ques­tions to Fred Strat­ford is why he has agreed to meet with me. Af­ter all, the com­pany has main­tained a low pro­file for many years and is per­haps known pri­mar­ily for its 'pre­mium' po­si­tion­ing.

Is that a fair as­sess­ment, I ask. “Yes, I think it is,” he says. “We took a de­ci­sion around five years ago to stay be­low the radar. We have been on a jour­ney that we are now very ex­cited to talk about.”

His ebul­lient na­ture is at odds with the com­pany’s low pro­file – to date – as he talks me through his ca­reer path. “I stud­ied maths at univer­sity and then qual­i­fied as a char­tered ac­coun­tant – I couldn’t wait to get out of it,” he laughs.

A fi­nance role at Thom­son Hol­i­days marked his en­try to the travel in­dus­try, but much of his ca­reer has not been within the sec­tor. In 2012 he was urged to join Reed & Mackay by an old ac­quain­tance. “He was my boss at Thom­son, so I've come full cir­cle back to travel,” he says.

He joined at a time when the com­pany was deeply com­mit­ted to de­vel­op­ing its own tech­nol­ogy, and do­ing it well away from the lime­light. The in­vest­ment is pay­ing div­i­dends now, Strat­ford ex­plains, with a mo­bile app – with book­ing func­tion­al­ity across air, ho­tel and ground trans­port – re­leased in Fe­bru­ary prov­ing “a fi­nal piece in the jig­saw”.

“Now is a good time for us to speak more openly be­cause what we’ve done isn’t easy to repli­cate. That unique­ness we have is not some­thing you can just take to mar­ket and de­liver,” he ex­plains.

“Our tech­nol­ogy is a real dif­fer­en­tia­tor for us. Own­ing our own tech en­ables us to give clients be­spoke de­vel­op­ments. Ask an offthe-shelf sup­plier to do that and you have no chance, no mat­ter who you are.”

De­spite its in­vest­ment in tech, it is the com­pany’s high-touch ser­vice that ap­peals to its port­fo­lio of largely le­gal, fi­nance and pro­fes­sional ser­vices com­pa­nies.

“It’s ser­vice first, se­cond and third,” he says. “It’s in the DNA of the busi­ness. You’ll pick it up if you walk around here.”

He con­tin­ues: “We’re unashamedly not the cheap­est TMC in the mar­ket, but our client re­ten­tion is re­ally high and there’s a good rea­son for that. We fo­cus on the to­tal value. We pay our staff great wages and we in­cen­tivise them to find clients sav­ings. That’s very dif­fer­ent to what any­body else does.”

The com­pany’s com­mit­ment to clients is such that in­ter­na­tional ex­pan­sion, backed by a pri­vate eq­uity in­vestor, was nec­es­sary. Some cus­tomers were clam­our­ing for an in­ter­na­tional of­fer­ing and the TMC knew it needed to act.

“We were run­ning the risk of los­ing some of our clients. We got to the point where they were look­ing for global MI, global trav­eller track­ing and the full Reed & Mackay ser­vice in their key mar­kets. We moved at the right time,” Strat­ford ex­plains.

The TMC now has 40 part­ners around the world, it has made ac­qui­si­tions in France, Ger­many and the US, and it has opened its own of­fices in Sin­ga­pore and Dubai.

“There are one or two mar­kets we’d like to be in which we’re not at the mo­ment, so we’re work­ing on those. And we're look­ing at get­ting our over­seas of­fices up to scale quickly,” he says.

And what about Reed & Mackay’s longterm goals for growth? “My view is that in three years time we’ll be dou­ble the size we are today. That will take some ac­qui­si­tional busi­ness. Be­ing a £750-800mil­lion busi­ness in three years is more than achiev­able,” says Strat­ford.

Ac­qui­si­tions of UK TMCS are not out of the pic­ture, but the com­pany will be se­lec­tive. “If they have the same ser­vice mind­set we’ll take a look,” he says, but he also fears for the fu­ture of some TMCS.

“The chal­lenge is that some TMCS are un­able to in­vest in the tech they need, but also some TMCS are so on­line-based, and have clients with such sim­ple travel needs, that profit mar­gins are se­ri­ously slen­der.”

Strat­ford con­cludes: “As long as clients see they’re get­ting value for money then you’ve got a sus­tain­able busi­ness. The vast ma­jor­ity of TMCS are re­silient and ro­bust, and as the world gets more com­pli­cated and travel gets more com­pli­cated, the fu­ture is bright for our sec­tor.”

The TMC boss tells why the busi­ness is now in a po­si­tion to raise its pro­file

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