Prospects Brighten For Improved Negotiating

<B> Prospects Brighten For Improved Negotiating</B>

By Maria P. Vallejo

The future looks brighter for travel buyers negotiating for better rates and services because oversupply and declining occupancy has drained some power away from hotel companies.

Although there are no certain markets that will guarantee lower rates in every hotel segment, three indicators may help travel buyers determine the best bargain areas. Declining occupancy and number of rooms sold, coupled with significant increases in room supply, can point to cities that are prime for negotiating.

"If you understand the dynamics of a particular market in terms of occupancy and room rate performance, and what's happening in the supply and demand situation, you can sense whether those markets will alleviate the pressure where it exists," said Chuck Ross, vice president of Smith Travel Research in Hendersonville, Tenn.

Thirteen cities out of the top 25 markets in the United States have shown a decrease in occupancy since last year, while only five of these markets show both a negative change in occupancy and rooms sold (see charts below).