Room for Savings: Optimizing Hotel Spend - Carlson

To ensure that the agreed conditions are being
met, companies should monitor hotelier
performance throughout the year and identify
any improvements that need to be made. In
particular, it is worth focusing on three main
areas:
Rate loading in global distribution
systems (GDSs). An initial CWT audit of five
companies’ programs revealed that only 50
percent of negotiated rates were loaded
correctly, while a further 10 percent were
loaded incorrectly and were on average 15
percent higher. This result is common and
such GDS rate loading errors can add
approximately 5 percent to overall hotel
program costs. When monitored and
discussed with hoteliers, however, results can
improve dramatically. In this analysis, regular
rate audits gradually raised the percentage of
correctly loaded rates to 77 percent. Ideally,
an audit should take place at the beginning
of the year to ensure the new terms and
conditions are applied, and be repeated
several times until most errors have been
eliminated (Figures 118-119).
Figure 118: In an initial audit of 5 companies’ programs, only 50% of negotiated rates were
loaded correctly into the GDS
Loaded
rates (%)
100
GDS audits for 5 companies, 2008
(Companies X, AE, G, D & AK)
80
60
60
75
67
83
77
Rates loaded
Rates loaded correctly
40
50
20
0
1st audit 2nd audit 3rd audit
Sources: CWT Hotel Solutions Group, CWT Travel Management Institute