ALEXANDRIA, Va.--(BUSINESS WIRE)--ACTE Global (Association for Corporate Travel Executives) announced today results of its latest research study, underwritten by HRS, focusing on how corporate hotel procurement practices continue to evolve. The study, “A New Horizon in Hotel Sourcing,” found that change is in the air for travel executives: More than half (51 percent) of programs have made some change in their approach to hotel sourcing in the past three years – with the vast majority saying they have derived savings from a new direction.
Driven by multiple pressure points, including rising hotel rates, a fragmented hotel marketplace and the amount of time that traditional hotel sourcing takes, 48 percent of travel managers who made a change decided to outsource some or all of their hotel procurement to either a global hotel services provider or a third-party specialist.
The research reveals several other noteworthy trends that point to a shift in how companies – particularly larger, multi-national programs – approach hotel supplier negotiations:
- Companies working with a global hotel services provider or a consultancy report annual savings of seven percent, while those working with a travel management company (TMC) reported saving four percent per year.
- Approximately one in ten programs (11 percent) report implementing continuous sourcing – a relatively new practice that sources hotels year-round, as opposed to during a limited RFP process at the end of each year. These companies report positive changes, including improved traveler compliance and satisfaction, financial savings and increased portfolio flexibility.
- One of the primary barriers to continuous sourcing adoption is education: 42 percent of travel executives who have not implemented continuous sourcing are not familiar with it. About one third (31 percent) cite lack of time or resources.
- One-fifth of travel executives report that they do not stay abreast of business changes that could impact their hotel programs, such as an emerging need in a new geographical market, unless it’s RFP season. This suggests that, for the remaining executives who do monitor throughout the year, continuous sourcing may help them act on business shifts more quickly.
“We live in an age of information overload and constant disruption, and failure to quickly act on market developments can be costly for travel executives, both in terms of dollars and traveler satisfaction,” said Greeley Koch, executive director of ACTE. “More than half of early adopters of continuous sourcing report savings -- illustrating how travel managers can leverage cutting-edge practices to position themselves at the forefront of the changing business landscape and as leaders in their organizations.”
“Hotel sourcing offers travel programs their best opportunities for both financial and strategic change,” said Marco D’Ilario, vice president of sourcing for HRS. “This global survey depicts an industry where programs are clearly seizing newfound opportunities and leveraging irrefutable data to gain not only savings, but superior program performance. It’s nothing less than a redefinition of the RFP process.”
For more information on “A New Horizon in Hotel Sourcing,” download the full report here. The study findings will also be discussed at the ACTE New York City Global Summit & Corporate Lodging Forum during a lunch-and-learn session on April 30.
About This Study
ACTE members around the world (Americas, 38 percent; EMEA, 38 percent; APAC, 24 percent) were polled electronically from February 20 to March 5, 2018, about strategies and challenges in the hotel sourcing process. A total of 226 executives responded to the survey, which was conducted by Rockbridge Associates, an independent market research firm.
About ACTE
ACTE Global (Association of Corporate Travel Executives) has a 30-year reputation for leading the way corporate travel is conducted. As a global association comprised of executive-level members in more than 100 countries, ACTE pioneers educational and technological advances that make business travel productive, cost-effective and straightforward. ACTE advocacy and initiatives continue to support impactful changes in safety and security, privacy, duty of care and compliance along with traveller productivity that supports global commerce. Learn more at www.acte.org.
About HRS
HRS simplifies business travel. Corporate travel managers and business travellers around the world trust HRS to find the best accommodation and simplify all processes related to their business travel. In addition to professional hotel sourcing and the negotiation of corporate rates with hotels, HRS optimizes paperless payment of hotel accommodation and meetings as well as automated invoice processing. More than 3,000 multinational corporations rely on HRS Global Hotel Solutions. Customers include global players from the Fortune 500, including Google, Siemens, Alibaba, China Mobile and Volkswagen. HRS pursues clear goals: savings for companies and high traveller satisfaction. Founded in Cologne in 1972, HRS today has more than 1,500 employees in 34 offices worldwide, including London, New York, São Paulo, Shanghai, Singapore and Tokyo. Further information at corporate.hrs.com.
