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Lesley's Column

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20th June 2016

It’s that time of year again…

At 3SIXTY we are preparing for hotel RFP season – that time of year when you think about your hotel rate programme for the next 12 months.

Hotel sourcing has always been a long and complex process, consuming many hours, days and weeks. The process must commence in August/September in order to ensure completion of rate loading for the start of the New Year.

It used to be a fairly simple box ticking exercise, but things have changed.

Previously you would solicit the required hotels, follow up with a couple of rounds of negotiation, then publish deals to your travellers and hope the rates would be utilised.

Now there are more options to strategically partner with suppliers and influence your travellers to ensure savings are achieved. The market is more complex but also offers more opportunity and flexibility for the buyer.

So what’s important this season?

• Dynamic pricing is an important part of many programs.
• Consider a negotiated rate as the ceiling rate and only utilise if a lower rate is not available.
• Rack rate and corporate rate are no longer a realistic benchmark for savings.
• Ensure programme coverage by blending Last Room Availability (LRA) and Non-Last Room Availability (NLRA).
• Chain agreements will fill any ‘gaps’ in the programme.
• Consider using loyalty programmes.
• Monitor availability across the rates at different times and not just once after rate loading.
• Consider including the cost of amenities. This means breakfast, parking, internet etc – these extras can substantially increase the total cost.

For more information on how you can take control of your hotel programme, please contact me at 3SIXTY. I would be glad to go over this in more detail.