HEDNA Warns Of Hotel CRS Errors

<B> HEDNA Warns Of Hotel CRS Errors</B>

By Amon Cohen

Corporate travelers unwittingly are buying hotel rooms at standard published rates under the mistaken impression that they are getting corporate rates negotiated with the hotel company.

The problem is a result of a practice called ''squatting," in which hotel companies load rates with client access codes into global distribution systems without verifying which properties are included in the corporate deals and which are not.

The practice has been branded as unethical by the Hotel Electronic Distribution Network Association, which has sent letters to members telling them to put a stop to it. ''As a result of squatting, travelers may book a hotel in the belief that they are conforming to company travel policy and are subsequently unable to collect reimbursement since the hotel was unauthorized,'' wrote HEDNA president Flo Lugli (of HFS Inc.).

The situation is bad on both sides of the Atlantic, insiders said. ''In the U.S., it is very bad indeed,'' said Susie Chimenti, industry relations vice president of travel agency network Thor 24. ''It is one of the biggest issues at the moment and it has got to the stage where things are at a pretty heated pitch.''

Andrew Solum, London-based travel manager for satellite communications company Inmarsat, confirmed there is also a problem in Europe. ''If you sign a deal with one hotel in Brussels; suddenly it looks as though you have preferred rates at all their properties,'' he said.

Solum is concerned that his travelers inadvertently will wind up staying at hotels in remote areas or encounter inferior service levels to those in hotels normally endorsed by Inmarsat. ''If they cannot get their laundry done, they will be seriously inconvenienced and annoyed, and will blame the travel manager or the travel agent,'' he said.

There is also concern that squatting dilutes genuinely negotiated agreements, causing preferred hotels to lose customers and clients to fail to meet volume commitments. ''It is stealing from hotels that have paid to be in the contract,'' said John Melchior, managing director of international operations for Woodside Travel Trust.

According to Melchior, 95 percent of cases of squatting are accidental. Time constraints and CRS limitations make it easier to load all their rates with access codes and then purge the ones that are not valid. But travel agents say the hotel companies are taking too long to purge invalid rates.

Worse still, some companies appear to be squatting with deliberate intent to mislead. ''It is hard to determine whether it is deliberate or not, but when you alert a hotel company and it does not take action, you start to get suspicious,'' said Chimenti.

Woodside Travel Trust is threatening to cancel contracts with hotel chains that continue to squat properties and also has proposed that HEDNA publicly shame persistent offenders by issuing a formal blacklist.

Rosenbluth International director of global hotel programs Frank Scaravaglione said he has not renewed contracts with specific hoteliers who engage in squatting. The Philadelphia-based mega agency runs an audit to weed out miscreants and brings the matter to their attention, demanding an administration fee to cover the costs of the exercise.

At present, no one is prepared to say out loud who the worst culprits are, but Julie Grout, hotel executive for the U.K.'s Guild of Business Travel Agents, said they are ''major global players.''

Meanwhile, HEDNA is responding by preparing a code of conduct and already has sent the warning letter to members. In it, Lugli wrote: ''It is important to recognize that squatting is not an ethical business practice. The HEDNA Board encourages Principal members to make sure that only authorized hotels are loaded under access codes.''

Agents and clients also are focusing their fire on the CRSs for their perceived inability to deal with the problem.

''I think the CRSs get off very lightly in this,'' said Kath Cotter, hotel manager for American Express in Europe, the Middle East and Africa. ''Hotel chains don't have the power to load individual rates. They have to load in all the properties and then remove those which are not valid.''

Grout agreed. ''I would like the CRSs to become acutely aware of the gravity of the situation, which is that hotel companies are abusing their distribution system'' she said. ''They should endorse the HEDNA code of conduct when it is published and ensure that data coming from their systems is valid.''

Unfortunately, the CRSs do not allow agents or clients to purge incorrect rates themselves. ''Occasionally, the CRSs cooperate to the extent that they will do it for us,'' said Chimenti. ''It is partly a technical problem and partly a question of who gets to control the information.''

Woodside's Melchior has no doubts about who should be in control. ''I should be able to say who goes into my closed-user group,'' Melchior said. ''It is amazing that I cannot.''

Disillusionment with the CRSs inevitably has set the travel trade thinking about their viability as a distribution medium for the hotel product. ''It could be that this method of distribution is not good enough and another technology supplier will come along which can do something about it,'' said Grout.

Solum, who has a CRS in his office, also is frustrated by its shortcomings. ''I am not aware that one can choose a property in them based on price,'' he said. ''Instead, I have to spend a long time going through page after page. I have to do seven basic ballet movements to get through the system and I can't go back a page like on the Internet--I have to go all the way through again. Also, if a hotel is full, I can't book it on a wait-list like I can with an airline. CRSs are a very poor means of hotel distribution.