Paul Barnes, Global Mobility Consultant from Inspire Global Mobility Consulting, looks at the current mobility industry and considers whether the one-stop shop RMC model is here to stay.
In an ever-evolving market, moving companies continue to face increased compliance, rising operating costs, fewer and smaller volume moves. An additional long-term challenge has been the loss of directly controlled business to Relocation Management Companies (RMCs).
Can we learn from other industries to help predict future trends and create successful strategies by reassessing strengths and weaknesses relative to the RMC and competitors' business models, with the goal of retaining and attracting more clients?
Lessons from the retail sector
The retail sector has seen significant changes, with many large home improvement and garden retailers such as Homebase (137 UK stores), Habitat (France), Sears (USA), and Lowes (Canada) facing financial issues and closures. These companies operated as 'One-Stop Shops,' offering a wide range of products including: decorating, garden, and DIY tools to BBQs and furniture. Their once successful business models provided convenience and value for time-poor consumers who preferred not to visit multiple specialised retailers.
Retail is a different industry, but is the model sounding similar, particularly with the use of the ‘One-Stop Shop’ terminology?
One-stop shop model
The RMCs rose to prominence as the ‘One Stop Shop’ for global mobility services. Many of us lived through the transformation of our industry as movers lost clients to the RMC model, which was attractive to in-house global mobility programme owners and procurement. Some of the value areas that RMCs explained their model would achieve for clients included:
- One contract instead of many
- Reduced time to manage supply chain
- Centralised billing from one provider
- Centralised data management and reporting
- Improved GM and employee experience
- Reduced points of contact
- Reduced costs
The RMCs required referral fees from their suppliers and started to push down costs in what was once a lucrative sector of the global mobility industry. But it was an inevitable transformation in line with those in other industries such as retail.
Predictions and strategies
So, are there valuable lessons or even future predictions we could make by comparing the retail and global mobility market sectors? Could they help predict how successful RMCs will be in the future and if the market will shift back to the specialist global mobility service companies such as moving? ...
Photo: Paul Barnes, Inspire Global Mobility Consulting.
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