Room for Savings: Optimizing Hotel Spend - Carlson

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Appendices Glossary The following is a list of key terms and abbreviations used in this document: Average room rate (ARR): the average of all room rates paid by a company or companies over one year Best available rate (BAR): the lowest room rate offered by a specific hotelier for each available room type on any given day Black-out dates: specific days on which a negotiated rate does not apply Chain-wide agreement: a fixed percentage discount off the BAR that applies at all hotels belonging to a chain City cap: a spend limit set by companies for hotel stays in specific cities Dynamic pricing: public rates that fluctuate, even daily, with supply and demand. A dynamic pricing agreement offers a fixed percentage discount off the fluctuating rate Last-room availability: an agreement that guarantees a company’s travelers will be offered the negotiated rate even if only one room of the negotiated type is available, except during blackout dates if applicable Negotiated flat rate: a preferential fixed rate offered to a company that usually applies for one calendar year Preferred hotel: a property (independent or belonging to a chain) with which a company has negotiated flat rates or a discount RevPAR: revenue per available room (or room yield), which is the most important indicator of hotel performance, taking into account room rates and occupancy Serviced appartment: furnished appartment accommodation offering hotel-style amenities such as breakfast and dry cleaning. E-folio: an electronically transmitted, itemized hotel invoice Global distribution system (GDS): a worldwide system used to book travel services, also known as a computerized reservation system (CRS) Hotel category: an indication of hotel quality (e.g., deluxe, first, standard or economy) Hotel program: a directory of preferred hotels with which a company has usually negotiated flat rates or a fixed discount off the public rate
List of companies researched in case studies Company Sector Headquarters A ................................ B ................................ C ................................ D................................ E................................. F................................. G................................ H................................ I.................................. J ................................. K ................................ L................................. M ............................... N................................ O................................ P ................................ Q................................ R ................................ S................................. T................................. U................................ V ................................ W............................... X................................. Y................................. Z................................. AA.............................. AB.............................. AC.............................. AD............................. AE.............................. AF .............................. AG ............................. AH............................. AI ............................... AJ............................... AK.............................. AL .............................. AM ............................ AN............................. AO............................. AP.............................. AQ............................. AR.............................. AS.............................. AT .............................. AU ............................. AV.............................. AW ............................ AX.............................. IT/technology/telecommunications Pharmaceuticals Heavy industry/manufacturing Utilities Healthcare IT/technology/telecommunications Banking/insurance/financial services Heavy industry/manufacturing IT/technology/telecommunications Energy/chemicals Biotechnology Heavy industry/manufacturing Consumer goods/retail Pharmaceuticals Banking/insurance/financial services Heavy industry/manufacturing IT/technology/telecommunications Food/beverages Banking/insurance/financial services Heavy industry/manufacturing Banking/insurance/financial services Banking/insurance/financial services Banking/insurance/financial services Banking/insurance/financial services Banking/insurance/financial services Energy/chemicals Energy/chemicals Energy/chemicals IT/technology/telecommunications Heavy industry/manufacturing Energy/chemicals Professional services Energy/chemicals Banking/insurance/financial services IT/technology/telecommunications Consumer goods/retail IT/technology/telecommunications Food/beverages Energy/chemicals Banking/insurance/financial services IT/technology/telecommunications Government/not-for-profit Consumer goods Energy/chemicals IT/technology/telecommunications Other IT/technology/telecommunications Heavy industry/manufacturing Consumer goods Food/beverages North America North America Europe Europe Europe Europe Europe Europe Europe Europe North America North America Europe Europe North America Europe North America North America North America Europe North America North America Europe Europe North America Asia Pacific Europe Europe Europe Europe Europe North America North America North America North America Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe Europe North America Europe North America Europe 135
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Room for Savings: Optimizing Hotel
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Contents Introduction Overview ....
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Research objectives This CWT resear
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Figure 1: Breakdown of surveyed com
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Key findings in brief The research
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changes. In addition to providing t
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A complex market The complexity of
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A lack of global standards to defin
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Complex pricing Hoteliers use diffe
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Figure 10: Rates remain fairly cons
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Figure 12: Most corporate hotel boo
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Data on hotel spend is however, not
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How to calculate your company’s t
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2. Twenty-one percent savings throu
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Many organizations have yet to opti
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GDS auditing It is important to ens
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1. Consolidate data Travel managers
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Figure 27: Combined TMC and credit
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Figure 28: Recommended data fields
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Hotel category: not the most import
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“No-frills” booking When it com
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In fact, travelers often draw on th
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A number of differences between the
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SUMMARY Understanding traveler need
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2. Ask travelers to use serviced ap
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Figure 41: Recommended rules for bo
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Figure 43: Rates are on average 18-
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Figure 46: In a rate benchmarking e
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5. Mandate booking at least two wee
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6. Address extra charges Travelers
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SUMMARY An optimal hotel policy cov
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4. Optimize the preferred hotel pro
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Identifying properties and location
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Considering local market conditions
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Figure 59: One company could save 6
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Figure 61(continued): The share of
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Figure 63: Hotel stays of at least
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Deciding between existing preferred
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Figure 69: Companies that retain at
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SUMMARY Key points for optimizing a
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5. Negotiate effectively Negotiatio
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Chain-wide agreements, as the name
Page 86 and 87: Chain-wide deals tend to offer smal
Page 88 and 89: There is, however, a risk associate
Page 90 and 91: Despite this reticence, 40 percent
Page 92 and 93: Figure 83: Another company’s ARR
Page 94 and 95: Last-room availability A last-room
Page 96 and 97: LRA is common in corporate contract
Page 98 and 99: Benchmark rates. Companies commonly
Page 100 and 101: Companies can consolidate volumes i
Page 102 and 103: Leverage city caps. Experience sugg
Page 104 and 105: Consider renegotiating flat rates d
Page 106 and 107: Buyers should use the full range of
Page 108 and 109: Hoteliers’ performance. A hotelie
Page 110 and 111: Ensure your travel management team
Page 112 and 113: 6. Improve traveler compliance The
Page 114 and 115: Understanding why travelers book ou
Page 116 and 117: The survey also indicates that trav
Page 118 and 119: Explain the stakes. Price-conscious
Page 120 and 121: Figure 112 shows how an OBT can be
Page 122 and 123: Require travelers to book their hot
Page 124 and 125: Investigate the reasons for noncomp
Page 126 and 127: To ensure that the agreed condition
Page 128 and 129: GDS rate squatting. Regular GDS aud
Page 130 and 131: Rate audits pay A rate audit conduc
Page 132 and 133: Tracking traveler compliance Compan
Page 134 and 135: SUMMARY Tracking performance: Compa
Page 138: For more information about how CWT
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