Hotels Join In B2B Venture
<B>Hotels Join In B2B Venture</B>
By Bruce Serlen
Bass Hotels & Resorts last month announced it had joined Marriott International and Hyatt Hotels Corp. in the launch of an electronic business-to-business hospitality procurement portal. Scheduled to debut by year-end, Avendra will provide access to a wide variety of goods and services. ClubCorp USA, which owns golf clubs, private clubs and resorts, is a partner in the undertaking as well.
Together, the four companies manage or franchise more than 5,500 properties in the U.S. hospitality market that is estimated to be worth up to $50 billion a year; outside the United States it's worth an additional $30 billion.
Marriott and Hyatt first announced the project, which will be powered by GoCo-op, in May.
The hotels' objective in pursuing electronic procurement is to realize cost savings. The intention, theoretically, then is to pass along these savings, at least in part, to customers, including corporate travel buyers. The exact nature or extent of these pass-along savings has yet to be determined.
Other major hotel companies, meanwhile, have been initiating their own procurement networks in recent months. Hilton Hotels Corp., for example, in June announced an agreement to merge its electronic procurement system into a Web-based portal operated by Purchasepro.com. Purchasepro.com already provides procurement for such hotel companies as Best Western International and MeriStar Hotels.
Meanwhile, Starwood Hotels & Resorts Worldwide in May announced it had joined forces with Zoho Corp. to drive its procurement. Hilton estimated its annual spend on goods and services to be $1.5 billion, while Starwood said it spends an estimated $3 billion.
"Joining Avendra will provide us with significant opportunities to drive process efficiencies," said Ravi Saligram, Bass' executive vice president and chief marketing officer.
For Avendra, Bass coming onboard provided the coverage it was seeking. "The alliance of these companies provides critical mass that will help drive standardization, improve economies across the supply chain and offer better value to customers," said Dennis Baker, president and COO of Avendra.