LONDON--(BUSINESS WIRE)--According to the latest procurement intelligence report from Technavio, the global car rental services market is expected to grow at a CAGR of 10.4% over the next five years owing to expansion of organizations into emerging markets, which is leading to a rise in business travel volumes.
The research report titled ‘Global Car Rental Services Market 2017-2021: Procurement Market Intelligence Report 2017-2021’ provides an in-depth analysis of category spend, best procurement practices and cost saving opportunities, aimed at helping organizations achieve superior business performance. The report also provides insights on pricing, supplier positioning and top companies, enabling sourcing professionals to improve their competitive advantage through procurement excellence.
“During the forecast period, the car rental services market will be driven by a rise in business travel resulting from globalization of industries,” says lead Technavio procurement specialist Angad Singh for category spend intelligence. “In addition, stringent environmental regulations against the use of individual vehicles in many countries such as Mexico and France are expected to increase the dependence of organizations on car rental services that enable pooling of employees,” adds Angad.
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Cost saving opportunities in the car rental services market
The adoption of various cost-optimization levers helps buyers of car rental services realize direct cost savings and enhance category management and value benefits (including reduced procurement complexities).
Technavio procurement experts have segmented the cost saving opportunities in the car rental services market into the following value-enhancement opportunities:
- Adoption of technology
- Supplier Competition
- Adoption of negotiation strategies
- Optimization of procurement practices
- Bundling of services
Adoption of technology saving aspects
Technologies such as fleet tracking, fleet analytics helps suppliers monitor, track the location and movement of their vehicles and formulate strategies that can enhance efficiency and cost savings to the extent of 15% of total category spend.
Buyers prefer to engage with suppliers that have a high level of technological adoption, as this will ensure convenience and enhance their overall experience. Technologies, such as fleet tracking and analytics, will also help buyers seek on-the-go advice regarding the optimization of routes and help in emergency situations.
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Optimization of supplier competition saving aspects
Service providers should have the ability to provide a wide range of vehicles, including luxury cars and economy cars, as per the changes in the requirement and preference of clients. They must also ensure that the cars rented by them are adequately equipped with tracking and anti-theft systems.
Suppliers should be able to provide various options and modes of payment to their clients, as they are convenient and ensure prompt payment. Hence, buyers prefer suppliers that accept all kinds of credit and debit cards, online payments, and payments through checks.
Bundling of services saving aspects
One of the most opportunistic strategic cost saving levers in the global car rental services market is the need for bundling of car rentals with vehicle recovery services and exclusive offers for hotel bookings and airline tickets.
Clients can be exposed to risks such as the breakdown of vehicles, theft of vehicles, or accidents. Hence, they prefer service providers that can provide prompt assistance during emergencies. The assistance can be provided with the assistance of technologies such as IVR. Suppliers should also ensure that proper training is provided to employees that are involved in support services, as this will improve the quality of support services rendered by them.
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Technavio is a leading global technology research and advisory company. The company develops over 2000 pieces of research every year, covering more than 500 technologies across 80 countries. Technavio has about 300 analysts globally who specialize in customized consulting and business research assignments across the latest leading edge technologies.
Technavio analysts employ primary as well as secondary research techniques to ascertain the size and vendor landscape in a range of markets. Analysts obtain information using a combination of bottom-up and top-down approaches, besides using in-house market modeling tools and proprietary databases. They corroborate this data with the data obtained from various market participants and stakeholders across the value chain, including vendors, service providers, distributors, re-sellers, and end-users.
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