Interview: Fredrik Hermelin, general manager, SBTA

Fredrik Hermelin joined the Swedish Business Travel Association as general manager in February 2023, succeeding Lotten Fowler who held the role for more than ten years. Hermelin was previously senior director, global sales at CWT Meetings & Events, and in his 25 years in the travel industry has also worked for Amex GBT, KLM and British Airways, as well as running his own leisure and adventure travel agency.

When it comes to sustainability, Sweden has led from the front. The concept of flygskam, literally meaning ‘flight shame’, originated in the country some five years ago, while Swedish national Greta Thunberg is among the world’s most high-profile environmental activists. And only last month, Stockholm authorities announced plans to ban petrol and diesel cars from its centre in 2025, becoming the first large capital city to take such action.

So it should come as no surprise, perhaps, that a cohort of the Swedish Business Travel Association’s travel buyer members attending next week’s GBTA Europe convention in Hamburg, Germany, are travelling there not by plane but by train.

“This year we wanted to try and challenge our big corporate members,” says Fredrik Hermelin, general manager of the Swedish Business Travel Association. The organisation worked with Swedish Rail (SJ) to hire a sleeper carriage with private single berths and offer its buyer members overnight travel from Stockholm, Linköping, Gothenburg and Malmö, for around €150 each way, arriving in Hamburg at 6.30am on the first day of the conference.

“It’s been a huge success. We sold out the entire wagon in less than 48 hours and had to book another,” says Hermelin. “It is the right thing to do. This is still not time-efficient but it’s the start of a movement. We need more destinations, more capabilities and more initiatives [like this] from event organisers.”

Hermelin concedes that for businesses engaged in international relations and deal-making it’s not practical, nor possible, to cease all flying, but companies in Sweden are perhaps at the vanguard of identifying and implementing methods to reduce the environmental impact of their business travel activity.

“Sustainability is the top priority of our members,” says Hermelin. “Looking at the big corporations in Sweden, they are definitely travelling less. European airports are busy again but it’s mostly leisure and SMEs that need to travel to survive.”

He continues: “The bigger Swedish companies – I’m thinking of companies like Volvo, Scania, Sandvik – they have reduced all unnecessary travel because they’re figuring out how to tackle sustainability. They’re only travelling when they absolutely must.”

That brings a challenge of its own, says Hermelin. “It means that airlines suffer and then reduce frequencies – giving corporates a new problem when they do want to travel.” His advice to buyers is to “communicate with suppliers to help them understand your behavioural change and what they can do about it.”

The former CWT executive, who joined SBTA in February this year, quickly draws parallels to TMC commercial models. “When a big company has a travel freeze they still want their TMC to have all the staff there for them. It’s about communication and forecasting demand. There has to be a new business model that bridges this. I’m ok with transaction fees but there has to be some sort of subscription fee in the partnership so TMCs can maintain the infrastructure for you.”

He adds: “It’s like not charging your electric car in order to save money because you’re not going to drive it, but then when you do want to… well, you’re screwed. We’ve been saying this for years: 97 per cent of a programme is travel cost and 3 per cent is to manage it. Let’s add another half a per cent [for managing it] and make it sustainable and make it work.”

Still wearing his former TMC hat, he also questions those corporates who “too quickly went out to RFP when service levels crashed” in spring 2022 as business travel surged back. “Instead of talking to their TMC and working through it, they went out to find an additional agency to support them. As a TMC I wasn’t interested in that. Everyone had resource issues so some companies were upset when we said ‘no, we’re not going to go through this unless you’re serious about fully moving over to us’. There was a lot of pushback.”

One of Hermelin's ambitions as SBTA general manager is to broaden its membership to encompass “more perspectives, more opinions and more industry verticals” and to bring more buyers into its fold from across the country.

Companies – rather than individuals – can join the SBTA and then name an employee to represent it. The membership model has its pros and cons, says Hermelin. While it might mean the benefits and value of membership are not so visible to the department bearing the cost, it does however gives companies the opportunity to ensconce someone new to travel in a rich educational environment. That is important, Hermelin explains, when there is something of a gulf in the approach to travel management between large companies and the small and mid-market.

“In the Nordic region, if you are a travel manager who has some experience, you know how to communicate, you have stakeholder engagement and you know someone is listening and respects you, you are most likely in procurement at a big company and you know how to deal with your c-suite. You know how to showcase your savings and the value you bring to your travel programme and you become a very well established travel manager.

“But there are also very many travel managers for whom it's not a full-time role, they don't really know or need to know the financials, they don't communicate with the c-suite and they don't have much stakeholder engagement... that's who we have to help get to the next level. We're also seeing travel managers leaving companies or being made redundant and not being replaced, and that's a problem.”

The association is also widening its geographical focus. “SBTA has sometimes focused too much on Stockholm, Gothenburg, south Sweden, even the Copenhagen-Malmo area, but we don’t really have anyone in the north. Stockholm and the south is only one third of the country; we have two-thirds of the country left to look at.”

The north, he says, although less developed, is home to a burgeoning energy sector and “massive investment in green power and technology”. He continues: “There is an amazing green transformation going on: mining, water and wind power, electric cars, hydrogen fuel test grounds, the largest battery producer [Northvolt]. The north is the new gold rush and that’s where we’ll be targeting new members.”

Another goal of Hermelin’s is to lead travel management away from a predominantly procurement mindset. He estimates that around 80 per cent of travel managers in Sweden sit in procurement.

“For procurement, it’s all about price. They don’t necessarily understand the value of travel and its impact on employees. They don’t always get how it relates to HR, they don’t know about duty of care… they just want the lowest price and a quick contract, but that is not the way forward. We can change that. Our role is to be on the barricade and talk about the importance of doing it right.”