Case Study

Building a dynamic and agile global hotel program

Confronted with escalating costs and a fragmented accommodation landscape, a major global consumer goods organization needed to optimize its hotel program.

Through strategic partnership with FCM Consulting, they consolidated data, enhanced contract negotiations, and integrated non-GDS content.

Not only did this achieve savings, but also streamlined processes that enabled the sourcing manager to focus on strategic initiatives.

Key Takeaways

Fragmented supplier base and rising costs threaten hotel program efficiency; agility unlocks savings.
Data consolidation drives smarter RFPs and negotiation, delivering measurable value.
Non-GDS content integration secures compliance and quality across all regions.
Policy optimization led to a 10.2% spend reduction and $2.8m savings opportunity.
Supplier engagement achieved a 94% response rate and reduced admin workload.
Ongoing management supports scalability, compliance, and risk mitigation.

Key Highlights

Enhancing a global program

In a supplier-driven market characterized by significant inflation pressures from labour costs, amenity expenses, and broader economic factors, managing a global hotel program requires strategic agility that is difficult for one person to manage on their own.

This case study examines how a global travel manager leveraged FCM Consulting's expertise to enhance an already-established global hotel program.

The objective was strategic and comprehensive: develop a dynamic program that balances cost control requirements with traveller satisfaction across diverse global requirements.

Background

The client's global travel manager had established a robust foundation for their global hotel program. However, they identified opportunities for enhanced value. Having successfully consolidated other services with FCM, they turned to FCM Consulting to collaborate on hotel procurement.

The program required accommodation of three distinct traveller segments:

1.Executive leadership requiring premium service standards

2.Domestic travellers in countries such as Brazil, where non-GDS content and local accommodation providers such as guesthouses are standard practice.

3.Travellers visiting global locations with GDS bookable hotels.

Challenges and Considerations

As well as catering to the three distinct traveller groups, specific operational challenges included:

Market volatility

Rising costs within a supplier-controlled market environment.
Content fragmentation

Reliance on non-GDS accommodation in specific regions (e.g., Brazil), requiring manual processes.
Value enhancement requirements

Need for tangible benefits, including food and beverage discounts, breakfast, and flexible cancellation terms.
Resource allocation constraints

Single travel manager serving as primary hotel expertise source, while requiring operational support for strategy and execution.

Solution: A comprehensive hotel strategy

FCM Consulting's Global Hotel Lead Rachel Newns delivered comprehensive account management engagement, going above and beyond a traditional transactional relationship. The approach focused on balancing traveller requirements with budget constraints, safety protocols, and corporate compliance standards.

Data consolidation and quality assurance

Rachel consolidated data across multiple travel management companies (TMCs), credit card systems, and supplier platforms. This comprehensive data integration enabled thorough cleansing and hotel portfolio review to determine actual value and global spend potential.

Strategic negotiation and RFP management

FCM Consulting managed comprehensive solicitation and negotiation processes, including:

Strategic consultation sessions

Client-directed strategy development, with FCM Consulting's operational execution.

Value-add negotiation

Securing inclusions such as breakfast, food & beverage discounts, and 24-hour cancellation policies.

Market benchmarking

Rate comparison against market standards to ensure competitive positioning.

Advanced negotiation protocols

Multi-round discussions with hotel suppliers to secure optimal contract terms.

Rate loading and hotel directory

Managed rate deployment and distribution, and took ownership of the hotel program directory.

Non-GDS content integration

For markets with substantial non-GDS usage, FCM Consulting organized standardized agreement forms (Portuguese translation included) to ensure smaller providers met requirements, and established safety and quality standards.

Ongoing program management

Our partnership extended beyond RFP completion through monthly review sessions, enabling:

Continuous optimization

Market change review and demand-driven hotel additions.

Compliance monitoring

Assessing whether supplier performance matched contractual agreements.

Presenting opportunities to the board

Supporting the global travel manager in organizing data and proof points for important presentations to leadership.

Result: A transformed global hotel program

The collaboration transformed the hotel program into a dynamic, value-generating strategic asset.

Quantifiable Savings

Projected saving vs market rates was £4.4m. If the client makes the recommended changes to its policy, they can expect a further 10.2% spend reduction, representing $2.8m opportunity value. With 545 hotels contracted and 94% response rate to the RFP, the program secured 80% coverage.

Time Saved

Administrative burden was lifted from the global travel manager, meaning they could focus on more strategic initiatives, while maintaining oversight.

Enhanced User Experience

Travellers benefited from improved accommodation options and enhanced amenities, with value additions and flexible cancellation policies becoming program standards.