What businesses are doing to cut their travel costs - Financial Times ...

GLOBAL 

TRAVELLER 

FINANCIAL TIMESSPECIALREPORT | MondayNovember 10 2008 

Squeezed? You will be 

What businesses are doing to cut their travel costs 

VIDEOONFT.COM 

Could private 

jets be the 

latest essential 

business tool? 

Rohit Jaggi 

(right) tests 

a new air 

taxi service 

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www.ft.com/globaltravellernov2008

2 FINANCIALTIMESMONDAYNOVEMBER 10 2008 

Global Traveller 

IN THIS ISSUE 

Soap Box 

ALAN PARKER 

The chief executive of Whitbread Group 

writes that ‘budget’ no longer has to mean 

‘bad quality’ Page 3 

Business Class 

AIR TAXIS 

Rohit Jaggi finds the arguments for the 

business have merit. But will they attract 

the required passengers? Page 4 

Frequent Traveller 

PETER GAGO 

The chief winemaker for Penfolds says 

preferential treatment for business travellers 

is not elitist, just fair Page 5 

Business Hubs 

LIMA, MUMBAI AND FLORENCE 

FT correspondents on grand Peruvian 

façades, charming Indian hotels and an 

Italian city that breathes culture Pages 67 

Wakeup call 

Roger Bray looks 

at the lengths 

companies will go 

to cut their travel 

budgets: The Big 

Story Page 8; 

Case studies – 

Boston Scientific 

and SFR Page 8 

CEO Interview 

CHRIS CUDDY 

Roger Blitz meets the head of Cheapflights, 

a price comparison website Page 11 

Front Page Illustration: MEESON 

Contributors 

Roger Blitz 

Leisure Industries Editor 

Rohit Jaggi 

Aviation Columnist 

Mark Mulligan 

Madrid Correspondent 

Naomi Mapstone 

Andes Correspondent 

James FontanellaKahn 

India Editor, FT.com 

Jonathan Soble 

Tokyo Correspondent 

Jill James, Roger Bray 

FT Contributors 

Seb MortonClark 

Commissioning Editor 

Steven Bird 

Designer 

Andy Mears 

Picture Editor 

For advertising details, 

contact: 

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josephine.bellanca@ft.com, 

or contact your your 

usual Financial Times 

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Travellight:clientsareplanningdaytripsratherthanovernightstaystosavemoney Corbis 

Battle lines drawn as 

budgets begin to bite 

AGENDA 

Hotels are bracing 

for a year of 

stiff competition, 

writes Roger Blitz 

Business travellers 

and the hotel industry 

have embarked 

on a battle royal 

over prices as hoteliers fight 

tooth and nail to stop the 

economic downturn from 

eating into their profits and 

corporations drive a hard 

bargain over room rates. 

According to some of the 

bigger hotel groups, business 

travellers hoping to see bargains 

being thrown their way 

from hard-pressed hoteliers 

during these lean times may 

be getting a bit ahead of 

themselves. But the mood 

among corporate travel buyers 

is uncompromising and 

hotel groups are reluctantly 

admitting that they are in 

the early stages of a 

prolonged buyers’ market. 

No-one in the hotel industry 

denies that trade has 

started to dry up, alarmingly 

so in some cases. Rezidor, 

the European-based group 

that manages Radisson SAS 

hotels, last week said it was 

cutting costs by €20m after 

announcing a big slump in 

profits. 

Marriott, Wyndham and 

Accor have all reported 

sharp falls in business and 

virtually everyone is predicting 

a rough ride in 2009. With 

companies scything through 

their travel plans, or trading 

down, discounted rates 

would appear inevitable. 

“For 2009, we will see 

hotels really looking for business 

in a way they have 

never had to do for a number 

of years,” says Nigel Turner 

of Carlson WagonlitTravel, 

the travel management 

group. “We will see some 

better rates in the marketplace. 

A lot of hotels are 

increasingly giving us indications 

that they are interested 

in marketing to corporate 

business.” 

Current discounts average 

about 10 per cent, “not a lot, 

given the increases in the 

last few years”, Mr Turner 

says. “But it is the first time 

we are seeing rates go in the 

other direction.” 

“Discount” is not a word 

that readily comes to hoteliers. 

Expect to hear hotel 

groups talk about “value” as 

they compete with each 

other for the ever-reducing 

numbers of business travellers 

over the next 12 to 18 

months. Cutting back on 

charges for accessory spending 

is one strategy. Those 

hotel groups with mid-scale 

brands can argue that customers 

who normally pay 

extra for hotel amenities at 

upscale hotels will effectively 

pay nothing for them when 

they trade down. 

“The winners will be the 

brands that offer exceptional 

value and service,” says 

Betsy O’Rourke, senior vicepresident 

of marketing at the 

7,000-hotel Wyndham Worldwide. 

“Travellers hate being 

nickelled and dimed to death 

for every service like internet 

access, local calls, use of 

a business centre or gym.” 

To win business, hotel 

groups know they have to 

spend marketing dollars, and 

the campaigns are starting to 

come thick and fast. Inter- 

Continental Hotels Group, 

for example, because it is 

legally obliged to spend a 

marketing fund made up of 

hotel owners’ contributions, 

has £800mits disposal. 

That will go partly into 

keeping IHG at the top of 

Google’s hotel search page, 

plus promotion of Holiday 

Inn two-nights-for-one offers, 

room upgrades and free 

breakfasts. But much of it is 

heading for its loyalty club 

points system, which has 

20m members. 

“We are certainly looking 

from a marketing point of 

view to increase the way we 

promote our loyalty 

schemes,” says Leslie 

‘The winners will 

be the brands that 

offer exceptional 

value and service’ 

McGibbon of IHG, which as 

well as doubling loyalty 

points will also be giving 

away wine and baseball merchandise 

through the system. 

Loyalty schemes have real 

traction in the US. Marriott 

is tweaking a variety of its 

reward programmes, increasing 

points bonuses, offering 

one night free on a five-night 

stay and abolishing “blackout” 

dates from January, 

thereby enabling members to 

redeem points on any day. 

Wyndham is doubling points 

for the next two months. 

But when it comes to customers 

beyond the US – 

where loyalty schemes generate 

less interest – and the 

all-important corporate 

travel brokers, pricing decisions 

may be the only means 

for hotel groups to control 

the inevitable decline in revenues. 

“Points appeal to travellers, 

but pricing appeals to 

the organisations they work 

for,” says Mr Turner. “If they 

want to hit both people, it’s 

got to be really on price.” 

Hotels and their corporate 

clients are in the midst of 

negotiating over 2009 prices. 

The anecdotal evidence 

shows clients shopping 

around more, plotting daytrips 

rather than overnight 

stays and reducing the 

number of hotel suppliers 

they use to increase economies 

of scale. 

JW Marriott, chairman of 

the hotel group, acknowledged 

last week that the outlook 

for next year was weakening. 

If occupancy drops 

further, it plans to open up 

more discounts on a hotel-byhotel 

basis. “Dropping the 

corporate benchmark rate is 

not something we will be the 

first to do,” the company 

said. 

It is not surprising that 

corporate travel brokers 

expect 2009 hotel bills to be 

considerably cheaper than 

those in 2008. “Most of the 

markets are expecting a 

discounting of prices and the 

corporate broker will use this 

to make any rate gain as 

little as possible,” says IHG’s 

Mr McGibbon. 

Did he just say “rate 

gain”? Even in this recessionriddled 

market, IHG is still 

working on the premise that 

hotel rates are going up.

FINANCIALTIMESMONDAYNOVEMBER 10 2008 3 

The biggest challenges of the recession 

SoapBox 

ALAN PARKER 

I was at my old school 

recently, talking about the 

ups and downs of life as a 

chief executive. The events 

of the past few months will 

certainly provide economics 

students with much to 

study. I have seen several 

downturns and recessions 

and the way in which the 

current one has come about 

is unprecedented. 

Whitbread has weathered 

a few storms in its 260-year 

history. No longer a brewer, 

we have made the business 

leaner and more agile so we 

can stay focused on what’s 

at our core – brands which 

represent value for money 

for all the family. Yet, there 

are always lessons to be 

learned. The biggest is the 

need to stay relentlessly 

focused on value, and on 

the customer. And the 

challenge is to do this 

without compromising on 

sustainability. The corporate 

landscape may well look 

very different in a few 

years’ time, but those who 

can adapt quickly to the 

changing times will prove 

the most resilient – and may 

even emerge stronger. 

This may not sound 

surprising. We have seen a 

huge growth in “budget” 

consumption over the last 

few years. Although this is 

nothing new – supermarkets 

created “Value” ranges as a 

response to the last 

recession – the public has 

become increasingly savvy 

at finding great deals when 

it comes to booking hotel 

rooms, eating out and 

buying food. And the 

market has adapted and 

grown to meet this appetite. 

This is clear from the 

phenomenal growth seen by 

the budget hotel sector in 

recent years. The number of 

rooms has more than 

doubled, from 40,000 to 

90,000, in the UK since 2000 

alone. Indeed, the sector 

now accounts for two-thirds 

of the annual growth within 

the UK hospitality industry. 

What’s more, occupancy and 

revenues are growing fastest 

at the budget end of the 

market. 

The budget hotel in its 

current form is a relatively 

new phenomenon. The 

sector certainly did not exist 

back in 1992, when we last 

saw a prolonged consumer 

recession. There were 

merely a large number of 

unbranded and unconnected 

independent hotels across 

the country. Since then, we 

have seen the emergence of 

a few major players, 

Whitbread’s Premier Inn 

being the leader in the 

overall UK hotel market. 

The branded budget hotel 

model provides the leisure 

and business traveller with 

a clearer choice when 

booking accommodation. It 

also gives them a more 

comfortable stay. 

“Budget” no longer has to 

mean “bad quality”. What 

may be surprising, however, 

is that I believe the sector 

has the potential to 

continue growing, despite 

the current challenging 

economic conditions. 

Like-for-like sales at Premier 

Inn rose 10 per cent in the 

first half, with revenue per 

available room (a common 

metric used in the hotel 

industry) up by more than 

6 per cent. The branded 

budget market is still 

relatively under-represented 

in the UK, with a 13 per 

cent share compared to 

23 per cent in France and 

25 per cent in the US, both 

more established markets. 

There is clearly room for 

more. That said, even in a 

growth phase, just like our 

customers, we must keep 

strict controls on costs. 

Other businesses are 

doing the same. We are 

seeing a significant increase 

in corporate customers. 

Under pressure to cut costs, 

The more the 

hospitality industry 

can do to promote 

itself as great 

value, the more 

likely we are to 

emerge stronger 

companies are recognising 

the value-for-money, 

guaranteed standards in a 

£50 room over a £100 

four-star room. “Trading 

down” doesn’t have to mean 

settling for something 

cheaper either, just buying 

smarter. Premier Inn 

attracted more than 1,800 

new companies to its 

Business Account scheme in 

the first half of this year, an 

increase of 16 per cent 

taking the total to 13,000 

businesses. 

Those who specialise in 

giving customers great 

value will have the edge. 

We’re all working harder 

than ever, but we still need 

to eat and sleep and relax. 

We shouldn’t have to stop 

the lifestyle we have, 

instead, we have the choice 

to prioritise differently. We 

know people still want to 

eat out, so we have looked 

hard at our restaurant 

business and have refreshed 

our menus with more 

emphasis on the value 

proposition, on lower-cost 

dishes and on attractive 

food offers (such as two 

meals for £9 at Brewers 

Fayre). Price flexibility is 

crucial in times like these. 

Perhaps the recession’s 

biggest challenge, a lesson 

we all need to learn, is how 

we can continue to give 

customers great value, but 

do it more sustainably. We 

cannot let these times serve 

as an excuse to let slip our 

responsibilities towards the 

environment. The industry 

needs to be sensitive to 

these challenges and 

continue to adapt 

accordingly. The 2012 

Olympics will bring millions 

of people to the UK. The 

more the hospitality 

industry can do to promote 

itself as great value, with no 

compromise in quality and 

sustainable practices, the 

more likely we are to 

emerge stronger than before. 

Alan Parker, CBE, is chief 

executive of Whitbread 

Group plc 


‘‘Budget’nolongerhastomean‘badquality’’ Charlie Bibby



Volume issue 

hoversoverair 

taxi startups 

BUSINESSCLASS 

European newcomers 

will be banking on 

high utilisation rates, 

reports Rohit Jaggi 

The concept of air taxis has 

not got off to a flying start. 

The US service that had 

the biggest ambitions, 

DayJet of Florida, had those lofty 

plans brought crashing down to 

earth by the credit crunch and 

delays in aircraft deliveries. Of the 

1,400 Eclipse 500 very light jets 

(VLJs) it envisaged operating, the 

28 it actually received are now 

being sold on by the manufacturer. 

In western Europe, conditions are 

different. While roads are more congested, 

there are more options for 

point-to-point travel, including fast 

rail services. And some, including 

the body responsible for air traffic 

control in Europe, fear the system 

will not be able to cope with sizeable 

fleets of four-passenger, twinturbofan 

air taxis. 

Meanwhile, the rapid deteriora- 

‘The timing for us is 

quite an opportunity 

...If the cycle follows 

the usual trends in the 

world, we’ll be launching 

in the upcycle’ 

tion in the financial climate has put 

a squeeze on conspicuous consumption 

of private aviation services. 

One large operator calls the current 

sudden slowing in business jet 

traffic a “pregnant pause”. 

But others say the situation 

demands that companies pursue 

opportunities more aggressively, 

and focus more clearly on choosing 

travel options that are efficient not 

just in cost but also in time. 

There is also evidence owners of 

large business jets are willing to 

slum it in an air taxi for shorter 

hops, because the cost is more easy 

to justify. In addition, commercial 

airline schedules do not often lend 

themselves to multi-sector trips in 

a single day. 

Blink, one of the first European 

start-ups to use the air taxi model, 

is confident. It says its decision to 

go with a per-plane hire basis, 

rather than the per-seat model that 

DayJet was so confident would succeed, 

gives it an edge. But at the 

same time that model puts it close 

to the traditional private charter. 

Where the two models differ is 

that the air taxi start-ups hope to 

offer lower prices by achieving 

higher utilisation rates of their 

expensive assets – the aircraft. 

Established charter companies 

expect to have their aircraft flying 

for about 400 hours a year. Blink is 

aiming at more like 800. 

The Farnborough-based company 

started operations in June, and has 

been operating with only one aircraft 

since. “It’s still very early,” 

says Peter Leiman, Blink managing 

director. “With one plane we can’t 

draw any definitive conclusions. 

But, that being said, in September 

we achieved a utilisation rate that 

on an annualised basis would be 

840 hours a year.” 

Blink has opted for a single plane 

from an established manufacturer – 

the four-passenger Citation Mustang, 

from Kansas-based Cessna. 

There have been none of the delays 

and technical issues that still afflict 

the Eclipse, the aircraft that the 

now-defunct DayJet chose, according 

to Mr Leiman. 

Two additional Mustangs arrive 

this month, then on average one 

more a month will be added to the 

fleet over the next two years. 

The Phenom 100, another new 

aircraft from an established manufacturer, 

has been chosen by 

JetBird, which plans to launch next 

year from Germany. It has 56 firm 

orders and 44 options for the fourpassenger 

Phenom, made by 

Embraer of Brazil. JetBird expects 

its first aircraft in April with, on 

average, two more a month to 2013. 

Stefan Vilner, JetBird chief executive, 

is unfazed by the current economic 

woes. “The timing for us is 

quite an opportunity,” he says. “We 

are going to launch quietly in 2Q 

2009. If the cycle follows the usual 

trends in the world, we’ll be 

launching in the upcycle.” 

According to Domhnal Slattery, 

JetBird founder: “From an equity 

perspective, the balance sheet is 

very healthy. We completed all of 

our equity financing before the dislocation 

in the markets.” 

Financing for the start-up phase 

is key. “Forty to 50 aircraft are 

required for economies of scale,” 

says Mr Slattery. “We assume we’ll 

get to critical mass in 2011.” 

Mr Leiman says signs support the 

idea that air taxis could expand the 

whole market. “Some 60 per cent of 

our customers are private-jet-down 

users,” he says. “But 40 per cent 

are new to private aviation.” 

Some analysts are not convinced. 

“The last time I looked you need 

utilisation rates of at least 1,000 

hours a year,” says Chris Tarry, 

who runs aviation consultancy 

CTAIRA. The arguments for air 

taxis, he says, “clearly have merit. 

But are they going to have the 

volume?” 

VIDEO ON FT.COM 

Rohit Jaggi puts the air taxi service to 

the test and looks at the vulnerability 

of the private jet sector in a downturn 

www.ft.com/airtaxis 

Offthebeatentrack:airtaxiscanputtravellersintosmallerairfieldsclosertotheirdestination Ben Stansall 

Pricecomparisonshowshowtheairtaxisfare 

Air taxi operators, whether in business already or 

about to be, push the idea that using their services 

can permit greater efficiency by allowing more 

meetings to be squeezed into one day, especially in 

places illserved by the airlines. Saving time by 

avoiding long checkin and security queues when using 

smaller airports is another bonus. 

But they also claim these benefits come at an 

attractive price. UKbased Blink says that if all four 

passenger seats in its Cessna Citation Mustangs are 

filled, the cost is within 20 per cent, up or down, of 

businessclass fares on scheduled airlines. 

JetBird, due to launch from Germany next year, is 

not giving away pricing details. But Domhnal Slattery, 

its chairman, says fares will be “50 per cent lower 

than current incumbent legacy players among the big 

charter companies”. That claim is echoed by Blink. 

To test the pricing model, I asked Blink to quote for 

a flight today from London to Paris to Stuttgart to 

Antwerp and back to London. Blink’s price, including 

all landing fees, was £5,049. A total flying time of less 

than four hours would leave ample time for meetings 

in all the destinations. 

British Airways, when asked for fares to cover this 

flight, was flummoxed. I could leave London early this 

morning, and get to Stuttgart, but the BA person was 

unable to find a way of getting me from Stuttgart to 

Antwerp. “You’re going to need to get in touch with a 

private jet charter company for this,” he said, 

unprompted. “You need a Lear jet, that’s what you 

need.” 

The best BA could find in a business class, fully 

flexible fare would not get me back to London from 

Amsterdam until tomorrow. It would also cost £1,199 

per person. “And that’s missing a bit in the middle,” 

as the goodhumoured BA fellow put it. 

A second attempt with BA got me to Brussels via 

Lufthansa late in the day, after a long stop in 

Stuttgart. Catching the last flight to London left no 

time to do anything more than sprint between aircraft. 

As an alternative, I was offered a £120 fourstar 

hotel room, and a first flight to London in the 

morning. Either way, the cost in fares and taxes was 

in the region of £1,190 per person. That comes to 

£4,760 for the same number of passengers you can 

fit into your own Mustang, 

The Air France office was thrown into confusion by 

my request. Much putting on hold while people in the 

office conferred, and a few false conclusions later, Air 

France came up with a route that covered all the 

ground – to Brussels though not to Antwerp – but 

would keep me out of London until Wednesday 

evening, the 12th. At a businessclass cost of £1,130 

per person, or £4,520 for four seats. 

But another factor may upset the pricing equation. 

According to aviation analyst Chris Tarry, fares on 

regular airlines are falling swiftly. 

Quotes for the same route from other aviation 

operators included £7,000 allin using a Mustang, the 

same aircraft as Blink’s, from air charter broker 

Oxygen 4. The broker also quoted £9,000 using a 

Learjet 45 superlight aircraft, and £14,000 for a 

Cessna Citation Sovereign super midsize jet. 

Business aviation specialist ExecuJet, meanwhile, 

quoted €17,200 (£13,890) for the route in a Learjet 

60, which can take six passengers. 

To put all that in context, a flight from London to 

Larnaca in Cyprus, taking about the same time as the 

total for the fourleg trip quoted above, would cost a 

NetJets customer about €18,700 on a Hawker 800. 

The Blink fare is close to that for four airline 

businessclass seats – and enables a more efficient 

day. But the average number of passengers on a 

business jet flight is only two – booking a Blink 

Mustang and putting only two people on it would give 

a very different complexion to the comparison. 

Rohit Jaggi 

Highlevel:RohitJaggiinBlink’sMustang Ben Stansall



Fullbodybubblesbestat35,000ft 

FREQUENTTRAVELLER 

PETERGAGO 

Chief winemaker 

for Penfolds talks 

to Jill James 

For a winemaker, Newcastleborn 

Peter Gago drinks an 

awful lot of water. But since 

he spends so much time in 

an aircraft cabin then it may 

not be such a surprise. 

“I drink plenty of water to 

counteract cabin air-conditioning 

systems,” he says. 

“But drinking my own company’s 

wine is now a touch 

more complicated as airlines 

will only let you on with less 

than 100ml of any liquid.” 

Bottles that he invariably 

has to bring on his travels 

are safely stowed in the hold 

with the rest of his baggage. 

As chief winemaker for Penfolds, 

one of Australia’s better-known 

wine producers, 

Melbourne-raised Mr Gago 

inhabits a truly global world. 

“But one that needs to be 

diligently serviced,” he maintains. 

He is more than happy to 

talk about wine with anyone 

and it is surely his communication 

skills that help make 

Penfolds Wine Recorking 

Clinics so popular. You may 

think these events are the 

‘If you’re travelling 

on business you 

should get some 

priority – this isn’t 

an elitist thing, 

it’s functional’ 

province of a wealthy few 

who just want to make sure 

their wine assets are safe − 

but you would be wrong. 

“We do get wealthy collectors 

of course,” he says. “But 

there’s a healthy mix from 

across the world, a broad 

spectrum from mums and 

dads, young and old, corporate 

buyers, anyone and everyone 

– people interested in 

finding out more about wine 

and looking after it.” 

Since 1991, he believes, the 

Penfolds team has recorked 

95,000 bottles of wine, 15 

years and older, worldwide. 

And, in case you are wondering 

why anyone should go 

to that trouble, you need 

only look at the prices that 

Penfolds charges for its top 

vintages. Its famous Grange 

and other Special Bin wines 

retail on release for more 

than £150 a bottle. 

Australia’s winemakers are 

more peripatetic than most. 

A high level of exports has 

much to do with this. In the 

case of Mr Gago’s company, 

two out of every three bottles 

leave Australia. 

Which is why New York, 

Miami, Chicago, Houston, 

San Francisco, Toronto, 

Hong Kong, Singapore, Wellington, 

Zurich, Munich and, 

of course London, are just 

some of the places to which 

Mr Gago and his team have 

taken the recorking clinics in 

the past few years. 

Athough he can be anywhere 

in the world in almost 

any season, the time of the 

Australian vintage is a complete 

no-fly zone. From February 

to May, he spends time 

in the winery and visiting 

his vineyards, from Coonawarra, 

Robe, Wrattonbully 

and Padthaway in Australia’s 

south-east to 

McLaren Vale, Barossa Valley, 

Adelaide Hills and Eden 

Valley. 

As a traveller with so 

much mileage on the clock, 

the Adelaide-based oenophile 

is very conscious of his carbon 

footprint – he does his 

best to offset – and points to 

the environmental policies 

his company has put – and is 

putting – in place. This is 

just as well since Gail, his 

wife, is a South Australian 

government minister and 

recent holder of the environment 

portfolio. 

His travels also bring a 

heavy workload. “We seem 

to work more and more 

seven day weeks really,” he 

says. “I work in the air as 

long as possible on emails, 

reports, catching up . . . ” 

In September, he flew 

direct from Sydney to Vancouver 

with Air Canada. “If I 

can avoid the unknown 

potential delays of US customs 

and immigration, then I 

will,” he says. 

Qantas is his airline of 

preference and his card privileges 

mean he takes advantage 

of all that business class 

and the occasional upgrade 

have to offer, from fine wines 

to good-quality lounges. 

Curious to know what a 

winemaker drinks when he 

is flying? He says: “At 

35,000ft I go for the bigger, 

fuller-bodied names in Champagne,” 

he says. “Bollinger 

and Krug – if ever on offer. 

Complex and fuller-flavoured, 

multilayered styles.” 

He nearly always has a 

glass of Champagne on takeoff 

and a glass of wine with 

his meal. “I treat the wine 

choice in the same way as I 

would if I were in a restaurant.” 

Good airlines take into 

account the real needs of 

business travellers, he says, 

adding: “It doesn’t matter 

what your class of travel – 

first, business or economy – 

if you’re travelling on business 

you should get some priority 

– whether it’s queuing 

less or being called at a later 

time for a flight. This isn’t an 

elitist thing, it’s functional. 

When I’m travelling on holiday 

I don’t have deadlines 

and in a more relaxed way I 

can spend extra time, if necessary, 

at the airport. Busi- 

ness travellers are always 

under a different set of time 

pressures.” 

When the FT caught up 

with him in London he was 

staying at one of his favourite 

hotels, the small and comfortable 

Capital, in Basil 

Street. 

Its appeal – apart from the 

Michelin-starred cooking of 

Eric Chavot – is its service, 

friendliness and understated 

luxury, says Mr Gago. He 

likes boutique hotels and 

mentioned the Hotel Gansevoort 

in New York’s meat 

packing district as another 

favourite. 

“But, hey, if someone else 

is paying I’ll happily stay at 

the St Regis.” 

One of the snags of travel, 

he says, is spending so much 

time away from home. “But 

in some ways at times it’s 

fortunate that Gail, my wife, 

is incredibly busy because of 

her job – I get away with a 

little more absence than I 

might otherwise.” 

He muses: “Jet-lag seems 

to catch up with me more as 

I get older, I’m now 51, and it 

seems such a random thing. I 

guess that and the massive 

waste of time spent in 

queues and on tarmac are 

the real downsides of travel.” 

Tasteful:PeterGago



Ancient cities 

still tantalise 

modern guests 

BUSINESSHUBS 

FT writers offer 

their tips on three 

key destinations 

Lima 

How to get there 

Most visitors arrive at Lima’s 

sparkling Jorge Chavez terminal 

in Callao, which in 

good traffic is a 40-minute 

drive from the seaside district 

of Miraflores (more than 

an hour at peak times). Travellers 

from Europe will have 

to connect in the US, where 

LAN and American Airlines 

have direct flights. It’s not 

advisable to take taxis from 

touts, but taxi remisse services 

within the terminal are 

good, though expensive. If 

you can ring ahead, local 

companies such as Taxi Full 

Service (+511 0125711311) and 

Taxi Seguro (+511 415 2525) 

are reliable. A hint for travellers 

returning home: get to 

your departure gate as soon 

as possible after checking in. 

You will need to queue three 

times – once to pay a departure 

tax, a second time for 

security checks, and a third 

for immigration. 

Where to stay 

While Lima’s colonial centre 

has some lovely squares and 

grand façades, many choose 

to base themselves by the 

ocean in Miraflores or San 

Isidro. Miraflores Park Hotel 

and the Marriott offer fivestar 

service and rooftop 

pools, as well as unbroken 

views of the Pacific and of 

the colourful flocks of parasailors. 

In San Isidro, Swissotel 

Lima and Sonesta Posada 

del Inca El Olivar are conveniently 

located. 

Where to eat 

This is the key question in 

Lima, a city rightly proud of 

its cuisine – a melange of 

Peruvian, Spanish, African, 

Chinese, Japanese and Moorish 

influences. If you learn 

only one Spanish phrase during 

your visit, make it “Que 

rico!” or “How delicious!” 

The city has thousands of 

hole-in-the-wall eateries 

where it is possible to get a 

menu of the day for 10 new 

sol ($3.30) or less, which will 

normally include a glass of 

chicha morada (sweet juice of 

purple maize), ceviche (fish 

marinated in lime juice and 

spices with a garnish of 

sweet potato, corn and sliced 

Spanish onions), a main dish 

such as aji de gallina (a type 

of chicken stew with yellow 

pepper) or arroz con pato 

(roast duck in a coriander 

sauce with rice) and a pudding. 

For the best criollo 

cooking, head to El Rincón 

que no Conoces, where Ter- 

ExplorethecatacombsofLima’sSanFranciscoChurch Alamy 

esa Izquierdo has been presiding 

over the kitchen for 31 

years. To hang with Lima’s 

smart set, book a lunchtime 

table (many of the best seafood 

restaurants are not open 

for dinner) at La Mar, the 

excellent cevicheria founded 

by celebrity chef Gastón Acurio, 

or the nearby Pescados 

Capitales. Its dishes are 

named after various deadly 

sins, including – aptly – gluttony, 

and if you pay close 

attention to the menu of the 

day you may find evidence of 

the latest political scandal – 

a recent menu featured “Los 

Aceitados” (the bribes) and 

“Yehude”, a tribute to the 

newly sworn-in prime minister, 

Yehude Simon, after a 

hasty cabinet reshuffle. 

For top Peruvian modern 

“fusion” food, try Astrid y 

Gastón or relative newcomer 

Hervé – a chic bistro that 

blends French technique 

with local ingredients. For a 

passionfruit pisco sour or a 

meal with a view, try La 

Rosa Nautica, which sits on 

a lovely wooden pier over the 

Pacific amid the breaking 

waves, or Huaca Pucllana, at 

the base of a centuries-old 

pyramid in the heart of Miraflores. 

What to do 

Lima was the Spanish centre 

of the Americas from 1535 to 

the early 19th century. It was 

levelled by an earthquake in 

1746, but nine years later, the 

cathedral that now stands in 

the World Heritage listed 

Plaza de Armas in central 

Lima rose from the rubble – 

a reconstruction of the original. 

Combine a visit to the 

cathedral to see the chapel 

said to house the remains of 

the explorer Francisco Pizarro 

with a trip to the nearby 

San Francisco Church for a 

guided tour of catacombs 

where thousands of skeletal 

remains are laid out. 

The legacy of the Inca and 

Moche civilisations can be 

felt everywhere in Peru, but 

the presence of the Huaca 

Pucllana pyramid amid the 

suburban homes of Miraflores 

is especially arresting. 

If you have a day to spare, 

you might also consider a 

trip to Pachacmac, a vast 

ancient ceremonial complex 

south of Lima, or Caral, a 

valley of pyramids linked to 

a pre-Incan society from 5,000 

years ago (a three-and-a-halfhour 

drive from Lima each 

way). 

Back in Miraflores, take a 

Reservedaseat?CommutertrainsarriveatChurchgatestationinMumbaiduringrushhour 

walk along the cliff-tops to 

the Love Park. If you’re not 

scared of heights, strap yourself 

in with a parapente 

instructor at the park next 

door and fly along the 

clifftops in either direction. 

On the beach below, you can 

rent boards and wetsuits and 

take a surfing lesson for 50 

new sols. 

The markets in Petit 

Thoars, Miraflores, offer 

goods from all over the country 

– alpaca scarves and ponchos, 

textiles, ceramics and 

paintings. 

A smaller night market in 

Parque Central de Miraflores 

offers a similar selection, 

with the added benefit of 

being close to good cafes and 

regular free evening concerts 

of Afro-Peruvian and other 

local music. 

Naomi Mapstone 

Mumbai 


Mumbai may be India’s 

financial capital but Chhatrapati 

Shivaji International 

Airport (CSIA) will not 

impress you: it’s dirty, congested, 

and still under construction. 

CSIA is in north Mumbai, 

about 35km from the south, 

where most business meetings 

and conferences are 

held. Travelling by taxi can 

be extremely challenging, as 

roads are constantly jammed 

and full of potholes – a sign 

of the cities dire infrastructural 

conditions. A trip from 

CSIA to the south can take 

anywhere between 45 minutes 

and 3 hours. To avoid 

the onslaught of taxi drivers 

offering their services, organise 

someone to pick you up 

at the airport. All big fivestar 

hotels can arrange for a 

driver with an air-conditioned 

car, which is a must 

for any business traveller. 

Although local cab drivers 

are very friendly and they 

tend to stick to the meter, 

the black and yellow 1950s 

Fiat cabs tend to flood the 

senses with pollution, stifling 

heat and pungent smells. 


You can find a good selection 

of luxury hotels close to the 

financial district in Nariman 

point, south Mumbai. A 

favourite is the charming 

100-year-old Taj Mahal, 

which overlooks the harbour 

and the Gateway of India – 

one of the city’s most popular 

tourist sites. If it is fully 

booked, try the Oberoi or the 

Intercontinental on Marine 

Drive, where you will find 

breathtaking views of the 

Arabian Sea. 

In the north, around Bandra 

Kurla, which is Mumbai’s 

version of London’s 

Canary Wharf, you can stay 

in the characteristic ITC 

Grand Maratha Sheraton, or 

there is the more standard- 

Hayatt and the Marriott fivestar 

hotels. However, if you 

are staying here, do not 

expect to go for a walk after 

dinner – you will be surrounded 

by construction 

sites and stray dogs. 

If you plan to stay for long 

periods you can opt for a 

serviced apartment at the 

Taj Mews Luxury Residence 

in south Mumbai, next door 

to the Anil Ambani, the 

world’s sixth richest man, 

according to Forbes. 


Mumbai offers the best selection 

of international food in 

India. Top of the list is 

Indigo, in Colaba, behind the 

Taj Mahal hotel, which 

serves a great Italian champagne 

risotto and seafood 

spaghetti. If you are in town 

over the weekend, try the 

Sunday brunch, which offers 

a mixture of continental 

starters, one main course, a 

selection of desserts and a 

“drink as much as you can” 

offer, which includes local 

champagne (or sparkling 

wine) Sulla and cocktails, all 

for Rs2000 (about $40). 

For seafood go to Trishna 

in Kala Ghoda, in the Fort 

area of South Mumbai. The 

fish is fresh and when it 

comes to lobster you can 

pick what you eat. Avoid fish 

during the monsoon season 

(mid-June to the end of September), 

as fishing boats 

remain docked in the har-


bour. For Indian food try 

Khyber, with their Mughalera 

dishes, which includes 

spicy curries and succulent 

kebabs. Khyber has two 

branches, one in the south, 

on Mahatma Gandhi Road in 

Fort, and a more recent additiona 

in Khar, in the north. 

If you are flying out of 

Mumbai, which means your 

flight will leave late at night, 

have dinner at Peshawari at 

the Sheraton, which is close 

to the airport. The sikandari 

raan, a slowly baked mutton 

dish, and a rich Dal Makhani 

(dark lentils), are a must. 


Enjoy a drink at the Inter- 

Continental’s Dome bar, 

which is on the rooftop of the 

five-star hotel, overlooking 

the Arabian sea. The place 

will give you a chance to 

enjoy a beer away from the 

hustle and bustle of Mumbai’s 

streets. Have a stroll 

along Marine Drive – the 

only walkable area of Mumbai 

– and enjoy the vibrancy 

of Chowpatty beach. Then 

take a car to the Blue Frog, a 

hip bar housed in a converted 

mill with great live 

music. 

Mumbai is also a good 

place for shopping. Apart 

from the malls, try Fabindia 

in the Fort district, which 

offers cheap ethnic garments 

with a western touch. You 

can also have a tailor-made 

suit or dress made by the 

Italian-trained designer 

Bloomberg 

Marco at Filoppo’s Boutique. 

The Indian tailor‘s team can 

turn five metres of fabric 

into a pinstriped suit in less 

than 12 hours. Located 

behind the Taj Mahal Hotel, 

ask the concierge for either 

Marco, or his father Filippo, 

and you will be directed to 

their small shop. A tailormade 

suit will cost you on 

average Rs15,000 (about 

$300). You will not regret it. 

James FontanellaKahn 

Florence 


Florence, or Firenze, has its 

own airport – Amerigo 

Vespucci, formerly Peretola – 

3 miles (5 km) from the centre, 

with direct BA flights 

from London City airport. 

However, it is a small airport 

and most airlines land at 

Pisa’s Galileo Galilei airport, 

an hour’s train or car journey 

away. From Pisa, trains 

run from the airport terminal 

to Lucca, Florence, Montecatini 

and Pistoia. Florencebased 

travellers will find the 

rail service efficient and 

dependable as the city is on 

the main north-south rail 

line. If you land at Florence’s 

airport you can book private 

transfers via the web. 

Do not forget to treat yourself 

to a good pair of shoes 

when you are there. Not 

least because walking is the 

best way to get around and 

the historic centre is closed 

to cars. It helps that the city 

is awash with classy shoe 

shops. 


Florence’s business is tourism. 

However, it is developing 

other sectors such as 

information technology. 

Many Florentines work in 

the suburbs where industries 

include furniture-making, 

production of rubber goods, 

chemicals, food, traditional 

handicrafts and clothes and 

shoes. Gucci and Ferragamo 

still operate out of the city 

that is now part of a huge 

industrial district running 

northwest to Prato and Pistoia. 

There is a good argument 

for basing yourself west of 

Florence if you are not doing 

business in the city itself. 

For example, the spa town of 

Montecatini has about 200 

hotels, good road and rail 

links with Florence and is 

itself a small industry hub. 

Grand Hotel Croce di Malta 

with 144 rooms – 64 with 

hydromassage fixtures – and 

22 suites, can host events for 

10 to 140 persons and is a 

firm favourite with business 

visitors. There are good restaurants 

here too, such as 

Enoteca da Giovanni in the 

Via Garibaldi. 

In Florence itself the fivestar 

Four Seasons is simply 

stunning. Set in an eight-acre 

park in the city centre you 

can relax amid original frescoes 

and sculptured reliefs. 

There is no such thing as a 

modest room here and just 

about every business tool 

that you need can be provided, 

including secretarial, 

translation and interpretation 

services, as well as a 

worldwide courier service. 

Business people with partners 

who like to shop might 

be keen to opt for the Helvetia 

& Bristol in Via Dei 

Pescioni, parallel with the 

Via Tornabuoni – one of the 

city’s most elegant shopping 

streets. The Grand Hotel 

Baglione and the Plaza & 

Lucchese are two other business 

and leisure favourites. 


For aperitifs or after-dinner 

drinks, try Angels Lounge 

Bar in Via del Proconsolo, 

Fusion Bar in the Gallery 

Hotel Art in Vicolo dell’Oro, 

and the Negroni Florence 

Bar in Via dei Renai. 

In the old part of Florence, 

tourist-free cafés do not 

really exist – you will have to 

go to the suburbs for that. 

But there are some nice, historic 

places where you can 

read a newspaper while sipping 

a macchiata. These 

include Caffè Gilli and Caffè 

Giubbe Rosse, both in the 

Piazza della Repubblica, and 

Caffè Rivoire in the Piazza 

della Signoria. 

Your business hosts will 

almost certainly steer you 

away from the main tourist 

traps. But for those occasional 

days when you just 

want a simple meal and a 

glass of red wine you are safe 

pretty much everywhere. If 

you need to do some entertaining 

of your own then the 

two Relais & Chateaux-rated 

properties Enoteca Pinchiorri 

(Via Ghibellina), and Onice – 

the restaurant of the Villa la 

Vedetta (Viale Michelangelo) 

– would be stunning, albeit 

pricy, experiences. Pinchiorri 

is the proud holder of three 

Michelin stars. 


Florence breathes culture, so 

even if you usually spend all 

your free time time in bars 

and nightclubs then exposure 

to art is inescapable. 

This is, after all, the city of 

Leonardo, Dante, Machiavelli 

and Galileo. You will be most 

unlucky if your visit fails to 

coincide with a festival or 

exhibition. Since there are 

1,000 ways to explore Florence 

you must plan and book 

as much aspossible. Or bribe 

your hotel concierge to do it 

for you. The web site 

www.firenzeturismo.it is an 

invaluable source of information. 

Florentines, like most 

Italians, take football and 

shopping seriously. Fiorentina, 

or la Viola – an allusion 

to the team’s purple shirts – 

inspire fanatical support and 

the team’s ground, Franchi 

stadium, has national monument 

status. Firenze rugby 


club might be more appreciative 

of the extra cheers 

though – and you will have 

no trouble getting tickets for 

its home games in the Via 

Delle Panche. 

If you visit one shop – shoe 

fetishists note – then the Ferragamo 

flagship boutique 

with its lofty frescoed ceilings 

in the Palazzo Spini 

Feroni would be a good 

choice. Its museum contains 

10,000 shoes. Personally, I 

would head for San Lorenzo 

and the food delicatessens. 

The size and variety of the 

salamis alone are enough to 

make strong men weep. 

Jill James 

Setinstone:theartandcultureofFlorenceisinescapable Reuters



Cash crisis sounds wakeup call 

THEBIGSTORY 

Roger Bray looks at 

the lengths to which 

companies are going to 

cut their travel budgets 

The long suffering road warrior, 

reading a list of ways 

to save money on trips suggested 

by American 

Express Business Travel, might be 

forgiven the urge to rebel. 

“Employees that stay together 

save together,” says the international 

travel management company 

in a 10-point plan to offset the 

impact of the financial crisis, 

issued from its New York headquarters. 

Some companies, it 

claims, are already asking employees 

to share hotel rooms. 

But while waiting for a colleague 

to finish shaving before using the 

bathroom may seem an economy 

too far, evidence is mounting that 

companies around the world are 

seeking to reduce the cost of business 

travel. How are they going 

about it? 

When KDS, the online travel and 

expense management provider, 

asked its clients how the downturn 

was hitting them, 54 per cent said 

they expected to have pruned travel 

costs by next March and 36 per cent 

said they had cancelled trips 

already booked. 

A survey by the Brussels-based 

Business Travel Coalition of corporate 

travel managers in 17 countries 

found that just over a quarter 

had implemented emergency cutbacks 

in recent weeks, over and 

above those made earlier this year. 

Of those, about one third had 

banned all trips temporarily. 

Roughly one in five had ordered 

cuts in travel spend, 45 per cent of 

those demanding reductions of 10 

to 20 per cent. The findings indicated 

that there had also been a 

significant swing towards the use 

of low-cost airlines, while 30 per 

cent of managers said their companies 

were planning “above normal” 

investment in technology that 

might obviate the need to fly, such 

as video conferencing equipment. 

Besides more predictable measures 

such as demanding employees 

should forego business class flights, 

steps being taken to reduce travel 

include compulsory seven-day 

advance purchase of air tickets, 

avoiding overnight stays or, perhaps 

extending trips, visiting more 

customers in one go, requiring staff 

to stay in cheaper hotels and use 

compact or economy rental cars 

rather than more expensive models. 

A separate survey of corporate 

travel managers by the National 

Business Travel Association in the 

US found that the reintroduction of 

minimum stay requirements by airlines 

on domestic routes was having 

a marked impact, with “a significant 

percentage” encouraging 

staff to consider staying over on a 

Saturday night if the saving outweighed 

the additional hotel and 

meal costs. Many were urging travellers 

to compare the cost of airport 

parking with using taxis, and to 

use public transport if possible. 

They were also requesting employ- 

Shareandsharealike:astimesgettight,employeescouldbeaskedtomakecertainsacrifices Alamy 

BostonScientific Staff comfort still a priority 

Travel budget in Europe, the Middle 

East and Africa is about €30m, but 

the company is looking for a 5 to 

10 per cent reduction. It has frozen 

all but essential, customerfacing 

travel (such as sales trips) and is 

encouraging others to use 

alternatives such as web 

conferencing. 

Employees are recommended to 

make “hybrid” flight bookings: 

travelling to North America in 

ees to share hire cars and fill up 

the tank before returning them, to 

avoid higher refuelling charges 

imposed by rental companies. 

Companies with large enough 

demand to negotiate discounts with 

airlines, hotel groups and other 

suppliers in return for providing set 

levels of business should start by 

ensuring employees do not jeopardise 

those deals by booking with, for 

example, non-preferred carriers. 

Small or medium-sized businesses 

with insufficient clout to secure 

such deals may not have that 

option. As Norman Gage, business 

travel director of the UK’s Advantage 

travel agents’ consortium, 

observes, if only one or two personnel 

represent the company on the 

road, it is clearly much harder to 

make economies by cutting the 

number of staff travelling. “SME 

guys are more hand-to-mouth. The 

often have no choice but to fly.” 

One company, whose business 

travel clients include a large 

number of individuals and small 

outfits is UK-based Trailfinders. 

Typically, they are not big enough 

to employ inhouse travel managers 

or to secure deals with airlines or 

hotel groups. In the current climate 

it is “very, very clear” that such 

customers are seeking ways to cut 

economy, for example, but 

returning overnight in business 

class. 

It has also been discussing 

whether to ask staff to stay in 

lowerrated hotels. But, says, 

Volker Spichal, finance director for 

EMEA, “the idea is that people 

who already have fairly long days 

should still have some degree of 

comfort”. 

“We are trying to set ceilings on 

costs, says Steve Gadd, its business 

travel director. “The crisis has 

acted as a wake-up call. Maybe the 

company secretary has demanded 

savings on travel. As a result we 

are getting inexperienced employees 

asking for our help to reduce 

spending,” he says. 

“Increasingly, customers who 

might have been happy to fly direct 

when times were better are pre- 

‘Customers who might 

have been happy to fly 

direct when times were 

better are prepared to 

book indirect flights’ 

pared to book indirect flights – to 

India via the Gulf for example. That 

can add two to three hours to their 

journey times but it can save companies 

20 to 30 per cent on fares. 

Others are switching from flag carriers 

to emerging airlines such as 

Jet Airways and Kingfisher. 

“It’s also clear that people are 

moving away from the very high 

price luxury hotels, the uber-brands 

if you like, to less expensive fivestar 

properties. At the same time a 

the amounts staff spend...We 

want them to consider how much 

they would spend eating out on 

their own account.” 

The company hopes to use 

information garnered via the staff 

online booking and expense 

reporting tool, supplied by KDS, to 

drive down negotiated air fares and 

keep tabs on staff spending – 

naming and shaming the most 

profligate. 

lot of travellers are dropping from 

five to four-star hotels.” 

Although it may seem contradictory, 

at least one travel management 

company, Yorkshire-based 

Redfern Travel, has decided to help 

clients avoid travelling – by offering 

them the option of online audio 

or video conferencing. Commercial 

manager Mark Bowers says: “The 

credit crunch wasn’t the driver, but 

there’s no doubt that it will focus 

people’s attention on the first question 

they should always have 

asked, which is: do we really need 

to travel? They are now more likely 

to ask it and if they don’t, their 

senior executives are going to insist 

that they do.” 

Even the way businesses pay 

travel management companies can 

make a difference to costs. Norman 

Gage says: “After the downturn in 

the early 1990s we saw a shift from 

airlines and other suppliers paying 

agents commission, to our clients 

paying members overall management 

fees. After 9/11 clients found 

they were travelling less but paying 

agents the same fees, so there has 

now been a big shift to transaction 

fees [fees paid for each booking or 

other service provided].” 

The switch away from commission 

has meant agents are under no 

SFR 

Flowers for the Host 

The Parisbased mobile phone 

network operator has a total 

travel budget, including transport 

and other expenses, of about 

€18m. Staff make some 18,000 

trips a year. 

SFR succeeded in cutting its 

travel spending by 10 per cent 

last year and is now attempting 

to achieve a further 20 per cent 

reduction. 

With about 70 per cent of its 

travel already restricted to the 

use of trains, it has banned the 

purchase of first class tickets 

for trips of less than two 

hours. 

It has now also increased the 

minimum rail journey time above 

which employees are allowed to 

fly, from two to three hours. 

The company is planning to 

raise the time threshold beyond 

which staff may book business 

class on longhaul flights from 

three hours to five or six hours. 

At the time of writing a decision 

was still pending. 

Strenuous efforts are being 

made to maintain high use of the 

company’s selfbooking tool. 

Travel manager JeanFrancois 

Magne says this shows staff 

economic ways of travel, 

including advance purchase of 

nonrefundable tickets if they are 

confident the trip will not be 

cancelled. 

“To do that for each employee 

would be impossible for me and 

uneconomic even for a travel 

management company.” 

Staff who choose to stay with 

friends or relatives on the road 

get €15, not as some miracle 

solution to cut costs, says Mr 

Magne, “just to buy flowers or a 

bottle of wine”. 

pressure to push business class 

fares, he notes. 

“Previously they earned more 

from selling premium class but now 

they don’t care which class they 

book.” 

Automation also helps cut costs, 

says Mark Bowers: “A figure we 

have often heard from government 

travel sources is that by the time a 

train ticket has been sent out and 

an individual invoice issued – and 

maybe sent to the wrong department 

– the administration cost for 

one trip is on average £41. We have 

automated transactions, providing 

clients with ticket printers and 

invoicing all their trips together at 

the end of the month, which they 

say cuts the cost to £3.50. I take 

both the higher and lower figures 

with a pinch of salt but even if they 

save £10 on each transaction it is 

considerable.” 

Meanwhile other recommendations 

in the Amex list include 

reconfirming appointments rather 

than risk incurring flight cancellation 

fees; before embarking on 

longer trips, comparing the cost of 

recently-imposed fees for checked 

bags on some US airlines with that 

of the hotel laundry, which, if you 

really have to share a room might 

have other added advantages.



Safe and friendly place to sing your heart out 

EXECUTIVEGUIDE 

TOKYO 

Jonathan Soble is 

told where to go 

by an old hand 

In the battle of the Beatles 

tribute pubs, John Vail is an 

Abbey Road man. 

“I used to go to the Cavern 

Club years ago, but I heard 

their old band moved to 

Abbey Road (4-11-5 Roppongi, 

Minato-ku, 03-3402-0017) so I 

started going there. It’s a 

very friendly place.” 

Tokyo – where Mr Vail, 

chief global strategist at 

Nikko Asset Management, 

has spent eight years – is a 

place of wanton cultural mixing 

and near-infinite choice. 

Other cities may have 

Beatles tribute bands, but 

only the Japanese capital has 

a mini-industry of bars dedicated 

to the form. 

“I like it when both western 

and Japanese cultures 

are represented. I’m not the 

kind of guy who insists on 

‘The subway is 

easy to use, 

except maybe in 

rush hour. It’s best 

to wake up early’ 

JohnVail 

ChiefGlobalStrategist 

NikkoAssetManagement 

sushi served the traditional 

way. I like fusion.” 

Mr Vail was born in Ohio 

and raised on Chicago’s 

North Shore. 

He watched Japan’s stock 

bubble inflate and burst during 

his first stint in the country 

from 1988-1992, as a fund 

manager with Fidelity. 

After returning in 2004 he 

joined Nikko – a big mutualfund 

manager that is now 

part of Citigroup – in 2006. 

“Tokyo is a lot more pricefriendly 

now,” he says. 

“It’s still really safe and 

the service is always impeccable. 

You never have to 

worry about being cheated. I 

never look at the coins the 

taxi driver gives me.” 

Hotels 

By Mr Vail’s reckoning, the 

Conrad (1-9-1 Higashi-Shinbashi, 

Minato-ku, 

03-6388-8000), in Shiodome, 

southwest of Tokyo Station, 

offers Tokyo’s biggest, bestdecorated 

rooms. 

For high-style lobby tea 

service he recommends the 

Ritz Carlton (9-7-1 Akasaka, 

Minato-ku, 03-3423-8000) in 

Roppongi’s sprawling Midtown 

development, while the 

venerable Imperial (1-1-1 Uchisaiwai-cho, 

Chiyoda-ku, 

03-3504-1111) in Hibiya boasts 

Tokyo’s “best old-fashioned 

bars”. 

Restaurants 

“I’ve never had a bad meal in 

Japan. It’s universally very 

high quality, and there is a 

huge amount of variety.” 

Nobu (4-1-28 Toranomon, 

Minato-ku, 03-5733-0070) 

offers its globetrotting brand 

of Japanese fusion at “surprisingly 

reasonable prices” 

in Toranomon, next to the 

Okura Hotel, while the New 

York import Union Square 

(9-7-4 Akasaka, Minato-ku, 

03-5413-7780) grills Tokyo’s 

best western-style steaks. 

Sushi connoisseurs are 

known to line up at Tsukiji 

fish market at dawn, but 

even the lazy have little trouble 

finding tasty maguro, 

ikura and hamachi. “For 

sushi, there are so many 

places and it can be very 

inexpensive – or outrageously 

expensive, if that’s 

what you want.” 

Networking 

Few places attract moneyed 

dealmakers like the Oak 

Door (6-10-3 Roppongi, 

Minato-Ku, 03-4333-1234), a 

bar and restaurant on the 

sixth floor of the Grand 

Hyatt hotel in Roppongi 

Hills. “It’s definitely a place 

to meet people,” Mr Vail 

says. At ground level in the 

same complex is Heartland 

(6-10-1 Roppongi, Minato-ku. 

Tel: 5772-7600), where the 

crowd of 30-something expats 

spills out on to the street, 

drinks in hand. 

Where to sing karaoke 

“I’ve had some of my best 

nights out at Fiesta (7-9-3 

Roppongi, Minato-ku, 

03-5410-3008), a small karaoke 

bar across from Roppongi 

Midtown where you sing on 

stage in front of everyone. 

It’s amazing – you get professional-level 

singers and warbling 

old men, but it’s always 

fun.” For those who prefer to 

keep their ululations among 

friends, the similarly named 

Festa (3-5-7 Azabudai, 

Minato-ku, 03-5570-1500), also 

in Roppongi, offers thousands 

of English songs in private 

rooms for up to 30 people. 

On an afternoon off 

“Meiji Shrine is so serene. 

You feel like you’re a million 

miles away,” Mr Vail says of 

the wooded Shinto sanctuary 

just west of the city centre. 

He also recommends peoplewatching 

in neighbouring 

Yoyogi Park or along Takeshita 

Street in Harajuku. “It’s 

jammed on the weekends 

with young people wearing 

all sorts of odd outfits.” For 

indoor culture there is Roppongi 

Hills’ Mori Museum 

(6-10-1 Roppongi, Minato-ku, 

03-5777-8600) and the nearby 

National Art Center (7-22-2 

Roppongi, Minato-ku), with 

its Kisho Kurokawa-designed 

curving glass facade. “Even 

if the exhibit isn’t special, 

just being in the building is 

treat enough.” 

What to miss 

“I’ve never been up Mount 

Fuji but I’ve had a lot of people 

say they’ll never do it 

again. It’s single file all the 

way up this rocky path, and 

you’re just looking down at 

the footsteps of the people in 

front of you all the way.” 

Getting around town 

“I don’t own a car – you 

don’t need to in Tokyo. The 

subway is clean and efficient 

and it’s easy to use, except 

maybe in rush hour. It’s best 

to wake up early.” 

Ideal excursions 

“Take a one-hour express 

train to Mount Takao, with 

shrines and many nice paved 

and rough hiking trails.” In 

winter, the ski slopes at 

Karuizawa and Echigo-Yuzawa 

are less than two hours 

away by bullet train. Overnighters 

can stay at the 

Karuizawa Prince Hotel 

(Karuizawa-machi, Nagano, 

0267-42-1111) or the Otani (330 

Oaza, Yuzawa, Niigata, 

025-784-2191), though there 

are “many wonderful oldstyle 

pension hotels everywhere”.



Land of the long – and filling – meetings 

BUSINESSETIQUETTE 

SPAIN 

Mark Mulligan reviews 

local working culture 

Spain is one of Europe’s great economic 

success stories; from lowwage 

backwater in the 1980s to 

modern global force today. However, 

do not be fooled by the shiny 

new wrapper: custom and tradition 

die hard in what is still an essentially 

conservative business society. 

“Doing business in Spain is still 

more like negotiating in northern 

Africa than agreeing a deal in 

northern Europe,” says a British 

financier living in Madrid. “Si, Si 

often means no, no, and nothing 

gets done in a hurry.” 

This lack or urgency may irritate 

those on a tight schedule. Spanish 

businessmen, particularly in multinational 

companies, are aware of 

this and will endeavour to adapt. 

However, government departments 

are indiscriminately bureaucratic 

and obstructive, despite regular 

promises by politicians to reduce 

red tape. In any case, it often pays 

to go with the flow. 

Business meetings that may take 

20 minutes in, say, Amsterdam, 

could drag on for an hour or more 

in Madrid. They can also seem a lot 

less structured, with participants 

appearing and disappearing with 

little explanation. Listening attentively, 

while a virtue in many societies, 

is optional in Spain. 

“Be prepared for chaotic business 

negotiations,” advises the International 

Business Centre, a not-forprofit 

on-line advisory service. 

“Often numerous people will be 

speaking simultaneously.” Meetings 

are usually called or scheduled 

for late in the day, and run well 

into the evening. 

Despite this relative chaos, business 

protocol and custom, though 

slowly dissolving in some sectors, 

is rigid. Attire is almost invariably 

sober and understated: dark suits, 

light shirts and conservative ties 

are the norm. One’s superior is 

always right and not to be contradicted, 

especially in front of others. 

Subordinates will often refer to a 

male chief executive as “Don” soand-so, 

bestowing upon him a title 

best translated as “sir”. 

Though foreigners are not 

expected to show the same deference, 

this treatment, on being introduced 

to the boss, will be appreciated. 

Use “Don” as part of a formal 

greeting, in Spanish, and your 

efforts will be noted. Simply effusing 

“Es un placer conocerle, Don 

Jaime”, or “Mucho gusto, Don 

Jaime” on shaking hands will 

DisdaininSpain:forsandwichesatdesks.Aproperlunchisfavoured Getty 

unfailingly elicit compliments 

about the level of your Spanish. 

After that, first names are generally 

fine, though the occasional 

“Señor” followed by the surname 

will help maintain a basic level of 

formality. Get the surname right: 

Spaniards generally have two and, 

although customarily go by the 

first – which is the paternal one – 

they sometimes use the second. 

José Luis Rodríguez Zapatero, the 

prime minister, is a case in point. 

Learning how to order a few 

favourite dishes in Spanish will 

also be a point-scorer. When there 

is business at hand, your host will 

generally insist on a three-course 

meal with wine, often prefaced with 

a beer and tapas and topped off 

with a post-prandial whisky or 

other spirit. These feasts rarely 

start before 2pm and can run to 

beyond 4pm, serving as a sort of 

long intermission in a commensurately 

long working day. Do not 

expect to find people in their offices 

during this time – Spaniards view 

with some disdain the idea of a 

quick sandwich at the desk. 

Business is not necessarily the 

focus of what many would term a 

“working lunch”, but rather a way 

to get properly acquainted. “Ideally, 

you should talk shop at the table 

only if your Spanish companions 

initiate it,” advises Executive- 

Planet.com. “In any case, protocol 

requires that you wait until coffee 

is served at the end of the meal to 

bring up the subject of business.” 

Avoid talk of politics until allegiances 

are established, and take 

note that Spaniards are sensitive to 

overt criticism of their country. 

“People in Spain – and other Latin 

societies – tend to confuse criticism 

of institutions with personal 

attacks,” says the head of an influential 

business lobby. This said, 

observations with a negative tinge 

are fine, although they are best offset 

with an equally unfavourable 

remark about one’s own country. 

They also value family life above 

all else, so questions about your 

host’s family normally go down 

well. Football is another great leveller. 

Spaniards are also fiercely 

regional. The former chairman of 

one electricity group delighted in 

presenting to visitors a tome of 

photographs from his province. A 

few anecdotes about your own 

home will keep conversation flowing 

until talk finally gets around to 

business. 

Green awareness grows 

MICE 

Germany leads the 

way in sustainable 

conferenceplanning, 

reports Jill James 

Rising environmental costs 

look set to play an even 

larger part in the meetings, 

incentives, conferences and 

exhibitions market (Mice). 

In Germany, which has the 

biggest share of the sector in 

Europe, environmental 

awareness is particularly 

strong. Many of the country’s 

hotels have been revelling in 

their role as “green models”. 

And, as last year’s American 

Express Hospitality Monitor 

showed, German hotels stand 

out for their energy efficiency 

on a European level. 

But it is one thing to run a 

hotel on environmentallysound 

polices and quite 

another to cater for conferences, 

congresses and events 

involving up to 15,000 people. 

“Take a little thing such as 

a coffee break,” says Michel 

Maugé, general manager of 

the convention centre in 

Mannheim. “Recently, I had 

5,000 people here and during 

their coffee breaks they used 

10,000 cups. It’s important 

that they are recycled.” 

Mannheim alone can cater 

for 9,000 people each day. 

“There are two things to bear 

in mind in terms of environment,” 

says Mr Maugé. 

“There is the buildings, hardware 

and energy savings 

side, and then there is what 

we do with the participants 

and their production of CO2 

when they travel here.” 

He says the new Mannheim 

building is more than 

double the size of the old 

one, but uses just 25 per cent 

more energy. “We have a 

new lighting and cooling 

system and have made big 

economies there.” 

Messe München (MMG), 

‘This starts with 

the question of 

whether an event 

should really take 

place or not’ 

Munich’s trade fair company, 

says it took account of environmental 

protection from 

the start. The new Munich 

Trade Fair Centre, it says, 

was the first to gain an 

Energy Efficient Enterprise 

certificate from TÜV SÜD, an 

inspection authority. It operates 

extensive measures to 

save energy, from building 

automation to energy-saving 

lighting systems. 

“Our goal,” says Manfred 

Wutzlhofer, chairman and 

chief executive of MMG, “is 

to use state-of-the-art technology 

to achieve the most 

efficient results, ecologically, 

technically and economically, 

in energy consumption 

and CO2 emissions.” 

Planners realise that an 

event is no less successful if 

it is green, says the German 

Convention Bureau. It says a 

new philosophy is gaining 

ground. “This already starts 

with the question of whether 

an event should really take 

place or not. Sometimes telephone 

and video conferences 

can be a cost- and energy-efficient 

alternative. ” 

However, once the goahead 

has been given, more 

planners are opting for a sustainable 

approach: sending 

invitations by e-mail; selecting 

a destination that is easy 

to reach; and choosing centres 

and hotels with a sustainable 

management. 

An example of what delegates 

may expect in future 

was highlighted by this 

year’s Imex show for meetings 

and incentive travel in 

Frankfurt. Visitors were 

encouraged to travel to 

Frankfurt by train with the 

help of discounts from Deutsche 

Bahn. Imex also introduced 

an anti-idling policy 

on all its courtesy buses and 

many used bio-diesel fuel. 

Sustainability may have a 

long way to go but, in Germany 

at least, they are paying 

it more than lip service.


AskGlobalTraveller 

Send your questions to 

askglobaltraveller@ft.com 

Q: What do you have to do to 

get an exit row seat? Recently, 

I was at the front of the line 

when checkin opened and still 

couldn't get one. The flight was 

oversold in economy, so the 

airline must have allocated them 

all. 

DP, IT consultant, Perth Western 

Australia 

A: You may be able to grab one 

online if you jump in as soon as 

internet checkin opens – but it 

depends on which airline you fly 

with. Safety regulations, generally 

state that passengers sitting in 

emergency exit rows must be 

sufficiently ablebodied to open 

those exits. But there seems to be 

widespread – or maybe wilful – 

misunderstanding of this rule. The 

kneejerk response from some 

carriers is that because they need 

to be sure passengers are not too 

old or infirm to make the physical 

effort demanded they can only 

allocate such seats at checkin. 

European regulations, at least, do 

not prevent allocation online or by 

telephone. British Airways, for 

example, says: “We used to only 

allocate these seats at the airport, 

this has all changed. But we still 

have those same checks online and 

you are required to confirm that 

you are able bodied and willing to 

help with an evacuation in the 

event of an emergency. This is 

checked at the airport as well.” 

Singapore Airlines has started 

offering online customers the 

option of exit seats, in return for a 

fee. Qantas assigns such seats only 

at the airport, as does Virgin 

Atlantic for £50 £70 one way. 

Q: Why doesn't every airline 

introduce an “economy plus” 

cabin? The extra five inches of 

leg room you get on United 

Airlines, for example, compared 

with a normal economy seat, 

really makes a difference. 

RA, marketing consultant, Essex, UK 

A: A particularly relevant question 

at a time when the economic 

climate is likely to force many 

travellers to downgrade from 

business class. It is also plain to 

see that those carriers that do 

operate such cabins have no 

trouble filling them. Air New 

Zealand, for example, which has 

twice upped the number of 

premium economy seats on its 

Boeing 747400 aircraft, announced 

recently it would double them on 

its 777200ERs, from 18 to 36. The 

argument against is that demand 

for these seats varies significantly 

between routes. Adding what is 

sometimes a fourth cabin – in 

addition to first, business and basic 

economy – leads to less efficient 

deployment of aircraft because it 

becomes more difficult to switch 

them from routes where there is 

heavy demand to routes where 

premium economy is harder to sell. 

United's economy plus, which is 

available on domestic as well as 

international flights, differs because 

it cannot be booked in advance. 

Although seats can sometimes be 

bought at the airport. If there are 

any left over they are used to 

reward frequent flyers or customers 

paying fully flexible economy fares. 

Q: When travelling business 

class on shorthaul, priority 

labels may be attached to hold 

baggage. More often than not, 

priority bags don't appear first 

on the baggage carousel. So 

what's the point? Airlines are 

advertising this as a benefit of 

buying business class, but then 

they omit the service. This is 

not so much of a problem on 

longhaul routes, where larger 

aircraft are used and priority 

baggage has its own container. 

PA, group manager, Staines, UK 


An optimistic look to the skies 

CEOINTERVIEW 

CHRISCUDDY 

Roger Blitz talks 

to the head of 

an airline price 

comparison website 

Thanksgiving 

weekend is 

approaching and 

according to 

Cheapflights’ Chris Cuddy, 

several of the bigger airlines 

are offering signficant price 

deals to grab business. 

“They have got relative 

breathing room,” says the 

chief executive of the price 

comparison website. When 

oil touched $140 a barrel 

this year, airlines cut 

capacity and costs and 

threw in additional fees. 

Now that oil is around the 

$60-$70 mark, the holiday 

season is a chance for 

airlines to pass on the 

benefit of the oil price 

decline to the traveller. “For 

the time being, airlines are 

ahead of their worst-case 

scenarios,” Mr Cuddy says. 

Few practitioners have a 

better immediate fix on the 

state of the travel industry 

than Cheapflights. Founded 

12 years ago by a former 

travel editor of society 

magazine Harpers & Queen, 

it introduced pay-per-click in 

the UK, making its money 

from airlines who advertise 

their deals on its website. 

Millions of flights are 

listed on its websites 

tailored to the UK, the US 

and Canada and Mr Cuddy 

last month launched the 

company’s first continental 

European site, for Germany. 

He hints further expansion 

is more than likely soon. 

It is his first big initiative 

since stepping up from 

group managing director to 

chief executive in March. 

Plans for a flotation are on 

hold, so there is nothing to 

distract from taking 

advantage of the downturn. 

“We are a value 

mass-market brand,” he 

says. “We are bigger than 

anyone else out there and 

drive more leads to the 

airline industry than any 

source other than Google.” 

Its leads resulted in $4bn of 

business for airlines and 

advertising partners in 2007. 

“When airlines are 

‘There is no 

substitute for 

being there and 

no practical 

substitute for 

longhaul flights.’ 

desperate to put people in 

their seats, that puts 

Cheapflights in a good 

position.” 

Mr Cuddy, 44, works 

between London and Boston, 

where he lives with his 

family. The US business is 

expected to overtake the UK 

division next year and, 

despite portents of gloom, or 

perhaps because he was 

being interviewed on the 

day Barack Obama was 

elected president, he 

remains upbeat about the 

industry’s prospects. 

“Air travel fuels the 

Extralegroommakesadifference 

energy of international 

commerce,” he says with 

evangelical zeal. “There is 

no substitute for being there 

and no practical substitute 

for long-haul flights.” 

Air travel overall has 

declined only marginally in 

these difficult months, 

despite the reduced traffic 

reported by some carriers, 

and the widespread pruning 

of travel budgets. “There is 

a disconnect with what is 

going on with airlines and 

passengers,” he says. 

Certain things have 

changed, though. Those who 

think business class equals 

business travel are plain 

wrong, he says: “Business 

travellers sit everywhere in 

the plane.” 

Travel guidelines for 

business travellers are 

getting tighter and will 

continue to do so. They are 

taking up bookings 30 days 

before flying to reduce flight 

costs, buying online and 

skirting around in-house 

travel agencies. 

With airline fares having 

risen by up to 8 per cent 

year on year, the pressure is 

on travellers to look at 

flying at weekends and 

other cheaper times. “We 

are doing it at Cheapflights 

ourselves,” he says. 

“Right now, business 

travellers are in the same 

mix as leisure travellers. 

They have to play by the 

same rules. If you are 

booking at the last minute, 

you are paying a much 

higher price.” 

Meanwhile, the dramatic 

movement in currency 

exchange rates is causing 

what he calls a 

ChrisCuddy:‘Airtravelfuelstheenergyofinternationalcommerce’ 

“game-changing shift”, in 

the past three months, to 

low-cost carriers which he 

expects will emerge from a 

recession in a better 

position than others. 

As for the airlines, the 

introduction of Open Skies 

may have been 

overshadowed by economic 

events, but Mr Cuddy 

believes the openingof 

transatlantic routes will, in 

the long run, result not just 

in an increased choice for 

business travellers, but will 

also give airlines greater 

flexibilityto cut routes and 

capacity. 

But Mr Cuddy also thinks 

airlines and governments 

still have a long way to go 

in understanding business 

traveller needs. “There is 

still a painful gap 

between...expectations and 

the reality of business 

travel,” he says. 

Infrastructure is still 

lacking in the UK, while air 

passenger duty has done 

nothing to change passenger 

behaviour. 

“There needs to be a 

comprehensive review of 

travel infrastructure. We 

need to put infrastrucutre as 

a priority for an island 

country.” 

A: It seems to be a widelyheld 

view that priority tagging is 

pointless. Swiss, for example, 

insists that it does work and says 

there is “absolutely no evidence” 

that the service is less effective on 

on shorthaul flights. That said, the 

number of airlines offering this 

service on shorthaul routes is 

fewer than you imagine. One that 

does not is Air France, which says 

a lack of infrastructure at some 

airports and variations between 

aircraft makes special handling 

difficult to organise with any 

consistency. Another consideration 

is that punctuality is more 

important to shorthaul passengers 

and sorting bags could delay flights. 

Austrian Airlines, on the other 

hand, does offer priority tagging. It 

says it focuses on making the 

service work but adds that, as with 

all airlines, this depends on the 

diligence of staff. Lufthansa, which 

offers the service to premium cabin 

passengers and frequent customers 

on short as well as longhaul 

flights, claims it “works very well”. 

Roger Bray

What businesses are doing to cut their travel costs - Financial Times ...

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