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Case Study: Cost Savings in Annual Hotel Portfolio Review

One of North America’s largest well completion providers, supporting oil and gas production and exploration, selected Corporate Travel Management (CTM) as their travel provider of choice in 2013. As hotel spend increased due to their increased growth, our client was looking to reduce room night costs. CTM helped our client evaluate, renegotiate, and maximize their cost savings in their preferred hotel property portfolio.

The Challenge

Our client relied on CTM to support a growing program and assist in the analysis and optimization of their preferred hotel portfolio. Our client aimed to reduce overall average daily rate, drive measurable savings, and capitalize on increases to their hotel volume spending patterns.

CTM and our client were presented with challenges to the hotel RFP process:

  • Analyze chain-wide discounts against existing and potential negotiated daily rates at specific properties
  • Analyze top markets to identify new and reduced spend destinations

The Solution

CTM assisted our client in analyzing and optimizing hotel rates and amenities across 4 major chains and at local properties nationwide.

CTM assisted our client in:

  • Renegotiation of 4 chain wide discounts with major hoteliers
  • Property level hotel RFPs at more than 90 properties nationwide with the following average daily rate (ADR) targets:
    • >100 room nights – up to $100 ADR
    • >500 room nights – up to $85 ADR
    • >1,000 room nights – up to $70 ADR
  • Evaluating bids, ensuring savings above and beyond chainwide discounts and CTM hotel program rates
  • Supplemented rates in key markets with CTM Hotel Program properties and rates

Results

CTM not only helped our client identify and optimize the right supplier partners to include in their preferred hotel portfolio, but we also supplemented their company program with rates from the CTM Hotel Program, ensuring our client always receives the lowest possible rate.

CTM worked with our client to deliver the following results:

  • Hotel portfolio of client negotiated rates and chain-wide discounts that represent and capture over 38% of the client’s total annual hotel spend
  • Savings for 2019: $639,000
  • Supplemented the clients negotiated rates and discounts with the CTM Hotel Program to ensure they always receive the lowest possible rate

Annual savings estimates are based on reduced average daily rates and improved chain wide-discounts on pace to save over $639,000 annually.

Eager to maximize cost savings in your hotel portfolio? Contact CTM for a Travel Health Check!