Drive Hotel Program Savings: Sourcing, Negotiation, Compliance and Verification
Hotel spend comprises approximately 39% of a company’s total travel expenditure and is typically the largest category of unmanaged spend. Corporate hotel spend can be broken out into three distinct categories: Transient, Long Term Stay, and Meetings. It is important for companies to create an integrated enterprise wide sourcing strategy based on these combined categories of hospitality spend and focus on projected hotel program savings.
Companies have tried to manage their hotel spend through numerous processes that can be categorized into the following: data capture, hotel sourcing and contracting, and verification and performance management. Accurate data capture on true spend and supplier activity are the key challenges for companies. There is no single source a company can rely on for data, thus only using one source will lead to second-rate hotel spend management. The five data sources companies have available include: Travel Management Company (TMC), Credit Card Provider, Expense Reporting System, Hotel/Supplier Data, and Purchase Order.
Even with the data sources on hand, the other challenge companies face within each of these sources is leakage to supplier programs and/or enterprise wide systems that are not configured properly to capture necessary hotel detail information. To shift this focus, companies should invest in auditing and verification to ensure a higher compliance to preferred suppliers and accurate rates. This strategy will ensure your hotel program is maximizing compliance, accuracy, leverage, and savings.
Reasons to alter your management of 2012 hotel spend:
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A well-managed program that integrates all hotel expenditures can produce possible savings of up to 35% of your hotel spend.
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By driving compliance to your preferred hotel suppliers, you know where your travelers are staying, ensuring duty of care.
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Validate supplier performance to confirm that waived services are always honored and negotiated rates are consistently provided at point-of-sale.
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Suppliers will continue to value your business and work jointly over the long term.
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Reduce corporation risk by managing accepted expenses and contracts.
Want to learn more about how you can ensure your hotel program is maximizing compliance, accuracy, leverage, and savings? Click the link to download the Lanyon White Paper on Rethinking Hospitality Spend Management.
