Professional buyers are costing companies money by failing to secure the best deals on hotel accommodation, claims hotel reservations group First Option. Following consultation with the British Travel Liaison Group and corporate buyers, First Option has published the industry's first model tender in a bid to ensure that buyers achieve the best savings for companies by asking suppliers all the right questions. But do companies agree or are they already winning the best deals?
Heavy equipment manufacturer Svedala's travel arrangements are managed by a travel company. 'We use a monthly report on standard air fares to check how much money we are saving. But we don't really know if we're getting the best deals on hotels,' admits spokesperson Margaret Lawrence, 'and there's always room for improvement.'
IT supplier Shiva agrees. Since handing management of employee travel to an 'implant' independent travel company situated on-site at Shiva, the company's costs have dropped dramatically because it can keep a much closer eye on prices, while freeing its own employees from having to deal with travel arrangements. 'We used to use an outside travel agency but it was an administrative nightmare and we had to accept its word that it was getting us the best deals,' explains Julie Scott, travel manager at Shiva.
BOC has also been forced to overhaul its travel-buying arrangements. Travel procurement used to be arranged on a country-by-country basis with UK BOC sites using local travel agents. The company is gradually introducing a scheme under which bookings for its 40,000 employees are made through one global travel company situated at BOC's sites around the world. This is already paying dividends as Craig Lardner, group manager, supply management, at BOC, points out. 'It's already saved us money and improved safety and quality of service for employees by using only specified suppliers.'
But some companies try to avoid any outside involvement, however controlled or limited. IT services company ICL believes in the direct approach, for example, and negotiates all travel deals itself. The company spends £10 million a year on air travel and £3.5 million annually on hotel accommodation in the UK alone. 'Many companies are naive on how their money is being spent and don't seem to realise that travel costs are negotiable,' says David Mannion, ICL's group purchasing manager. 'We directly negotiate airline and UK hotel rates on an annual basis and the direct contact allows us to build up a good rapport to help secure good rates.'
Others advocate the internet as a good source for hotel and travel deals.
As Richard Woods, spokesman for internet service provider UUNet Pipex, says: 'We should all be out there looking for the best deals. There are very good hotel and airline travel web sites on the internet which companies could use to check prices, so there's no excuse to lose out.' He would say that, wouldn't he?