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“Positive effects in 2010, and we will see more”

New Procurement and Production Unit (P&P) operational since March 2010

At the end of 2009 Kuoni announced the introduction of a new Group structure. At its heart lies the global Procurement & Production (P&P) Unit, which operates from three hubs: Zurich, Dorking (in England) and Stockholm. P&P became operationally active in March 2010. The unit concentrates Kuoni’s purchasing power and buys land arrangements and services at holiday destinations on behalf of the Group’s individual sales markets. The three hubs are managed by Thomas Goosmann (Zurich), Nicolas Delord (Dorking) and Takis Filippopoulos (Stockholm). They talk about the creation of the new unit in 2010.

What is the strategic importance of the new threehub global Procurement and Production Unit for Kuoni Group?
Thomas Goosmann: The new structure undoubtedly marks a significant milestone for Kuoni. We’re finding numerous synergies that we hadn’t been exploiting properly before. For example, we now have an improved hotel portfolio and better prices, which allow the points of sale (POS) to achieve higher margins. The standardisation of service providers, especially the agents at the holiday destinations, is also an advantage. And we are benefiting from further synergies with Kuoni Destination Management.

“2010 was exactely the right time to make a conentrated start.”

Nicolas Delord: We could, of course, have introduced this unit earlier. But I believe the new structure came at the right time. All the areas within the Kuoni Group recognised that because of changes in the marketplace it made sense to create a global Procurement and Production Unit.

Takis Filippopoulos: During the global economic crisis, competition between travel companies became even tougher than it was before. There may once have been a time when you could structure prices any way you wanted, but those days are definitely over. If you want to be competitive these days, you have to keep your costs down. We can only do this if we exploit our synergies and use the resulting benefits to produce more cheaply. The Kuoni Group is made up of a lot of different travel providers, and it will take time before the new structure is functioning at optimum efficiency. I think 2010 was exactly the right time to make a concerted start.

How are service providers – hotels and local agents, for example – reacting to the new way Kuoni is buying holiday services for its travel products worldwide?
Takis Filippopoulos: Most of our partners have reacted very positively, and they understand the benefits of working with us.