10 May Partnering with Procurement
While third party buyers sometimes grumble over their client’s travel procurement teams, the powerful procurement influence is here to stay, and in many cases it has become increasingly influential. Take, for example, the presale process and procurement’s early involvement and heavy influence over final hotel and destination selection. So what is a travel buyer to do? First realize that while procurement will continue to focus heavily on cost savings and pricing, this doesn’t always mean they misunderstand the value of high quality products and service levels. Most travel procurement employees appreciate that their event planners and executives are held to high standards – especially onsite and especially during an incentive trip. That said, it is their job to attain cost savings and cost avoidance through heavy bidding and tough negotiations. But fear not, below are some tips to help you prove your purchasing value.
First off, don’t be afraid to get to know your procurement partners. Set-up a lunch and get briefed on your client’s purchasing goals. After you gather useful information, create a client-approved master template that covers everything from preferred concessions to contract terms. Face-to-face meeting are also a great time to discover how your procurement partner likes to see your work presented. This includes everything from site sourcing and cost savings. Procurement will most likely be sharing your information with a superior or co-worker so, from File-Maker to Excel spreadsheets, presenting information in their preferred model will create inefficiencies. Finally, uncover your client’s internal approval process from start to finish. This should include everything from purchase orders to master agreements to hotel signature guidelines. Remember, setting things up right from the start will shorten the time to final signature.
It is wise to combine your purchasing power with your client’s when putting their business out to bid. A large tech company, for example, has likely garnered huge volumes of spend across several of the hotel chains you’ve including in your site search, so don’t be afraid to list your combined bookings. Once you’ve flexed those purchasing muscles, let the hotels know they’re in a competitive bid situation and keep your RFP live until you get everything you want from the desired hotel, including contract terms. Finally, recap all of your hard earned negotiations in a cost savings spreadsheet and contract negotiation summary. Your procurement partners will most likely get final hotel contract approval from their legal team, and a summary of the hotel negotiation process will support their positioning.
Finally, if all goes swimmingly and you and your procurement partner have become BFF’s, consider asking for a lifeline – something you’d like to call in for once a year (if that). This will come in handy when you hit a wall, and you’re not getting the room rate your client deserves or that “must have or walk away” contract clause accepted. To enlist your procurement partner’s help, explain where you are in the process and then set-up a call between the two of you and your hotel representative. Lead the call and keep it brief but don’t be afraid to have your client express their concerns – this two against one method often works and, after all, it’s about getting your clients what they want and helping your procurement partners shine.