The MacNair Travel Leadership Blog

6 Tips for Keeping Hotel Costs Down

Posted by Jessica Cardenas on Jul 24, 2015 12:00:00 PM

tips-for-keeping-hotel-costs-downIn today’s global business world, travel is a necessity. And whether you’re flying or driving, a hotel stay is a must. With the economy in a better place now than it was one year ago, hotels aren’t afraid to raise rates. And they have, according to a number of sources including The Global Business Travel Association (GBTA) and CNBC. Hotel rates have increased between 4 and 5% in the past year.

As the person who manages your companies’ travel needs, how do you find the balance between a satisfied travelling employee and a cost-conscious hotel room?

1. Look for bundled services

There’s no doubt that in 2015 hotels are comfortable charging more for their business travel services – but that doesn’t mean that they’re not willing to keep their corporate travelers happy. When researching hotel costs vs. amenities, compare what’s “bundled” into the room rate. Does the hotel room booking include free Wi-Fi? Free parking in a downtown location? Is there a gym and/or hot tub for your business traveler to relax? While one hotel’s room rate may be less expensive, they may be charging for additional amenities, and the overall cost savings is minimized.

2. Become part of a loyalty program

Staying in the same brand of hotel creates comfort for employees who travel. They know what to expect and can then focus on getting their job done. Loyalty programs also help your bottom line by allowing you to negotiate a better rate for employees. When you use a specific hotel brand on a consistent basis, your business benefits from the cost-savings, and depending on your travel policy, so do your employees. Most hotel reward programs give points for the amount of money spent, and the number of nights your traveler stays at their hotel. Depending on your company’s travel policy, these points can be used by the employee for personal vacation time – an added “thank you” to them for spending time on the road.  

3. Be specific in your travel policy about where your employees can stay

In order to reap the benefits of a loyalty program, communication of your travel policy is essential. One of the biggest challenges that we find is that businesses do not include specific information in their corporate travel policy regarding hotel stays. This leads to unnecessary confusion from employees when booking their trip. Can they say at the Ritz-Carlton? If the event has a hotel attached, is this the automatic booking for employees?

Having a clear, concise policy regarding approved hotel brands keeps it simple for employees and in turn, saves money for your business. This takes the guesswork out of booking rooms knowing that employees have options that are well-researched and make the most sense for them and for your business.

4. Encourage booking air, hotel and car at the same time, with one system

Your smartphone or tablet is always there, just begging you to simply secure your travel plans with a few clicks and swipes. But is this really the most efficient way for your employees to plan their travel? When you use an in-house travel management system to book travel, a number of benefits are noted:

  • The ease of use for employees not only saves time for employees’ planning their travel, but it saves the office manager or HR assistant time allowing them to focus on their job.
  • The pricing research is thorough, and there’s no question it’s the best price for your needs. A travel management system automatically has the best hotel price built-in to the total cost of your trip.
  • Data is gathered about where and when employees are travelling. This helps control costs and provides much needed answers when employees run into unsafe situations or other challenges while travelling.

A perfect scenario – John is new to your company, and will be travelling to Minneapolis in mid-January. The project he’s working on is somewhat short-term, and this is the second and final time he’ll be working with this client. As a new employee preparing for his first trip, he simply let the office manager book his flight, hotel and car rental even though he’s done a lot of travelling on his own. Since there’s not a specific travel management system in place, and the travel policy doesn’t specifically state where he can stay, he asked the office manager to book his flight for this follow-up trip; and he chose to take care of the hotel and car rental option on his own.

If you’re from the upper Midwest, you know that there are no guarantees with flights in mid-January, and as often happens, John’s connecting flight was cancelled en route due to a snowstorm. The office manager received the notice and with the help of the airline, booked him on the next available flight leaving the following morning. She was also able to alert the customer and explain the situation. What she could not do was follow-up with the hotel and car rental agency regarding John’s reservation. At the same time, John was scrambling to cancel and rebook his hotel and car without success…adding unneeded stress to an already exasperating trip. In the end, the company was charged a cancellation fee for the hotel and car.

When all travel needs are booked through one simple travel management system, companies know exactly where their travelers are and can effectively take care of any surprises or challenges that may arise.

5. The role of a proactive travel management company

The tips listed so far have covered a number of important ways to keep your hotel costs down for your business. They’re all important. And…they all take time. Some businesses have an employee dedicated to travel management; but the majority of organizations do not. When you work with a travel management company, time and money are saved, resulting in a more efficiently-run travel program. Your travel management company helps your organization stay on top of changes in hotel costs. They conduct research, follow industry trends and manage your travel program, while keeping the goals and policies of your organization a top priority.

6. Balance equals success

The success of your business depends on the hard work that’s accomplished by your employees. When employees travel, it’s essential to keep their stress level to a minimum and their focus on the job. Providing simple choices for a hotel with limited surprises is crucial for a successful trip. By following these few simple tips, finding the balance between a great night’s stay for your employees and a comfortable, cost-effective hotel is feasible and makes for happy employees and a healthy bottom line.

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Topics: travel policy