Small travel agencies struggling to get government business
Small travel agencies that want to do business with the federal government have few opportunities to bid on contracts, a travel professional who does business with the government told House lawmakers on Thursday.
"Although there are some positive signs of improvement in the $20 billion government travel market, much will depend on a win-win relationship of government contracting officers and the travel industry, in the months ahead," said Jacquelyn Alton, owner of CWT/Almeda Travel Inc. in Houston.
Alton told lawmakers that the government travel industry suffers because large agencies such as the Defense Department set aside very little money for small business contracts. In addition, subcontracting requirements on travel contracts are not mandatory and travel services are often bundled into other contracts. Finally, some federal offices are shifting to in-house travel management.
Contract requirements also serve as barriers to small businesses, Alton said. For example some contracts require that the bidder has had experience in serving government travelers. "It's hard for a small travel agency to gather that experience," she said.
Some agencies, such as the Defense Department, are putting more of the responsibility for trip planning on the employee, a move that hurts both the employee and the travel industry, Alton said.
"The taxpayer would be better served if government employees could concentrate on the job they were hired to do, and leave the travel arrangement to those with training, proficiency and knowledge of government travel and industry regulations," she testified.
Smaller travel agencies are also at a disadvantage because they don't have lines of credit to keep them financially afloat while they wait for delayed payments from government agencies.
"Small travel agency owners and managers basically worked without compensation in the months following Sept. 11," Alton explained. "To preserve cash flow, layoffs of long-term and family employees have been particularly painful."
To turn the situation around, government should reach out to more small travel agencies and change federal requirements and procedures that unfairly penalize small businesses, Alton said.