Mitigate 2019 Hotel Rate Rises With Smarter Buying Strategies

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Author: PASA

Hotel rates across Australia and New Zealand and the opportunities for small to medium sized businesses to negotiate those rates in 2019, will vary dramatically between key cities according to leading SME business travel provider, Corporate Traveller.

The key for SMEs to increase their savings and squeeze more value from their accommodation spend in 2019 is to know which cities are impacted by high demand and tap into your travel provider’s negotiated rates and exclusive hotel product.

Corporate Traveller’s comments follow the release of the 4D Accommodation Focus Report Australia and New Zealand 2019.

The 4D report revealed the following:

  • Average room rates (ARRs) and occupancy levels across Aus & NZ varied significantly during 2018, with increases fuelled by demand growth and new room inventory in markets such as Sydney, Auckland and Hobart. Rates were flat in Perth and Brisbane due to new room inventory being released with discounted opening rates
  • Across Australia in 2019:

–        RevPAR and ARRs are expected to average 3-4% growth (a $6 to $8 rate increase)

–        Occupancy levels in major cities are expected to remain flat at 80% (same as 2018)

–        The biggest ARR increases are forecast for Sydney (5%), Melbourne, Adelaide and Hobart (all 3%), while Canberra and Darwin will be 2% and Brisbane and Perth will remain flat

  • Across New Zealand in 2019:

–        RevPAR is expected to grow 4-5%, with Queenstown potentially achieving growth up to 15%

–        ARRs are forecast to increase 2-3% compared with 5-6% during 2018

–        Occupancy levels are set to remain flat at 81%

–        The biggest ARR increases are forecast for Queensland (5%) and Auckland (4%), while increases in Rotorua, Wellington and Christchurch will be lower at 2%.

Know your hotel rates to make smarter choices

Commenting on the report findings, Corporate Traveller’s Product Manager Zahrah Roush said SMEs that implemented ‘smart buying’ through preferred hotels for their business travel, meetings and events, would be those who achieved better value in their hotel rates.

“Increasing your booking volumes and loyalty with preferred hotels, rather than spreading your bookings across a wider range of hotels and last-minute booking sites, will pay dividends to SMEs,” Zahrah said. “Even though SME accommodation volumes are lower than those of large corporates, SMEs can still leverage loyalty with the same hotels to access negotiated or customised rates or tap into their travel provider’s customised hotel rate and products such as SmartSTAY rates, particularly in cities where the ARRs will be higher in 2019.

“SMEs can choose from different types of value-driven hotel rates depending on what best suits their company guidelines or travel policy, preferred suppliers, add-ons, pricing or rate conditions required.”  These include:

  • Customised Rates– ideal for travellers who need to book a hotel that’s already been negotiated into their company’s travel program
  • Consortia Rates – great for travellers whoneed full flexibility to change or cancel if their travel dates shift, as well as providing access to rate discounts available through an entire hotel chain
  • Promotional Rates– which offer travellers exclusive access to hotel loyalty rates including discounts of up to 50%
  • Conditional Rates– which are perfect for travellers who aren’t worried about flexibility and need to access low-priced last-minute bookings. These rates are often the cheapest available anywhere in the industry but are restrictive in their conditions e.g. travellers often have to pay up front and are penalised for cancelling
  • SmartSTAY Rates – which are exclusive to Corporate Traveller’s customers and offer a minimum of three FREE value add-ons through SmartSTAY hotel partners. These include sought-after extras such as free Wi-Fi, upgrades on arrival, laundry services, late check-out and early check-in and free breakfast or car parking. Through its 3,000+ hotel partners worldwide, SmartSTAY assures travellers of quality accommodation with some of the biggest brands worldwide.

“Corporate Traveller not only gives our SME clients access to all these rates, but provides expert advice through our Travel Managers on which rates are best for every booking. We give small businesses the strategies and hands-on support to reduce cost and add value to their accommodation bookings,” Zahrah said.

Visit the Corporate Traveller website for our video on deciphering hotel rates: https://www.corporatetraveller.com.au/offers/smartstay

 

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