Room for Savings: Optimizing Hotel Spend - Carlson

Consider renegotiating flat rates during
the year if market conditions mean that
better rates may be obtained. For example,
one company asked its top 100 properties
to propose new preferred rates in March
2009 to take into account the global
decrease in rates since the beginning of the
year. Figures 96-97 show how 64 of the
properties agreed to lower their rates by an
average of 8 percent. Some hotels
proposed substantially larger rate reductions
of up to 30 percent.
Figure 96: 64% of properties approached by a company in March 2009 agreed to lower their
previously negotiated rates
Number
of properties
Properties’ response to a request to renegotiate rates in March 2009
(Company I’s top 100 properties)
100
16
80
20
60
40
100
84
64
64% of hotels
renegotiated
20
0
All hotels
approached
(company's top
100)
No response Response Refused to
renegotiate
Agreed to
renegotiate
Rates dropped
by 8% on average
(US$600,000 savings)
Sources: CWT Hotel Solutions Group, CWT Travel Management Institute