Buyers Believe Environment Still Favours Suppliers

A survey conducted by GBTA and HRS among more than 250 travel managers globally revealed that the negotiation environment currently favors suppliers, with 77 percent of travel buyers believing this to be the case. European travel managers, in particular, are facing difficulties securing preferred rates.

In the past year, less than a quarter (23 percent) of buyers found it easy to obtain favorable hotel rates, and only 18% experienced the same for air travel. European-based travel buyers encountered even more challenges in the accommodation arena, with 74 percent finding it "somewhat" or "very" difficult to secure favorable rates, compared to 47 percent of North American-based buyers.

Looking ahead, respondents anticipate air (69 percent) and hotel (56 percent) categories to be the most challenging in terms of securing favorable terms in the next two years.

Despite the tough environment, 84 percent of travel managers plan to conduct hotel Request for Proposals (RFPs) within the next year, showing confidence in the evolving procurement landscape.

HRS CEO, Tobias Ragge, noted that suppliers currently have leverage, making it challenging for corporations to control travel costs while business opportunities grow. However, Ragge highlighted that many companies are taking extra steps to consolidate their accommodation data and spending to maximize value with preferred hotel partners. The convergence of transient, meeting, and extended stay volume is seen as necessary for supplier negotiations in 2024.

Travel managers cited the benefits of convergence as consolidated data (70 percent), greater discounts (66 percent), process efficiencies (57 percent), and time saved on RFPs (57 percent).

Suzanne Neufang, CEO of GBTA, emphasized that travel managers are increasingly recognizing the significance of convergence in their program approach. By collaborating with internal partners, they can enhance value, cost savings, and efficiency for their company, ultimately increasing satisfaction among business travelers.

Author Sandy Collins - Inspirernews.com

Reference: BTN Europe