What is a hotel booking agency?
Specific to the UK, hotel booking agencies (HBAs) provide expertise when it comes to hotel bookings, as well as meetings and events services. Some specialise in both sectors, others in only one.
How is that different from a travel management company (TMC)?
TMCs offer a variety of services, booking air, rail, hotels, meetings, and more. They also provide a number of other services, including consultancy and expense management.
Why did they start up?
HBAs were created because, originally, TMCs were so much better at negotiating with airlines than hotels that a dedicated hotel service was needed. Now, although HBAs still have the edge in understanding the hotel sector, some TMCs are beginning to put up serious competition.
Why should I choose an HBA?
For their expert knowledge of the hotel sector. Many TMCs still use global distribution systems (GDS) such as Amadeus to book hotels. These don’t include small, individual hotels that may offer better value or more personal service. As some TMCs now offer a good hotel service, HBAs are having to differentiate themselves through service.
What do I need to know?
First, and most important, be clear about the service you need. Is most of your travel in the UK, outside the UK, or a mixture? Do you have a negotiated hotel programme and, if so, do you want your HBA to run it? Or do you want to take advantage of its negotiated rates? Or a mixture of the two?
How do I choose an HBA?
Look for membership of trade association HBAA. The HBAA’s code of conduct requires members to submit a level of accounts reporting to ensure feasibility, and they have to be operating 75% of their business in the HBAA model. Potential clients are starting to ask whether companies are a member, which suggests the HBAA is increasingly respected. Ask how active a member the agency is. Is it just using the logo to achieve status, or is it actively working to help create best practice?
Are HBAA members exclusively hotel booking agencies?
No, some are events organisers and some book venues. Venues used to be a bit of a sideline but now have equal status.
How do I pay an HBA?
Agents offering a ‘free’ service are actually paid commission by the hotels and venues they book. This may have financial advantages for you, but it also means the agent is less likely to be neutral about where they book. Also, if you’ve already negotiated net rates with a hotel or hotel group, you don’t want an HBA trying to claim commission on your net rates. Some HBAs are flexible and you may get to choose between fee or commission.
If a hotel’s paying commission, how do I know I’m getting the best rate?
You don’t. If a hotel knows your HBA is negotiating a net deal, you’ll get the best rate. If the hotel is negotiating through an agency that’s commission based, it has to agree the level of commission and the agency can use that as leverage, i.e, ‘If you don’t give me this much, I’ll take my business elsewhere’.
What’s the best option?
The best option is using a combination of the HBA’s negotiated rates and your own rates. In any one city, the best rate can change by the month or the quarter, and if an agency can lower the rate according to its volumes, that can prove better than your negotiated rate.
Will an HBA have booking tools that can be integrated into my systems?
Larger ones will, but smaller ones may not. If that’s what you need, ask in the early stages.
Are their back office systems likely to be unsophisticated?
Far from it. Whether an HBA handles hotels or meetings and events, it’ll be able to provide good reporting on what you’ve booked, when, where and what it costs.
Should I look for expertise in my sector?
It may be a good idea if there’s complicated legislation in your business sector, such as
in the financial or pharmaceutical sectors, even if does mean sharing an agent with your competitors.
How good a relationship with suppliers does an HBA need?
If you have hotel representatives that look after your account, ask them for feedback on your prospective HBA. They should be working with suppliers to make sure they get an appropriate programme. You need to be able to rely on an agent to see through problems and find solutions quickly – a good relationship will make that all much easier.
- Thanks to Ian Flint, founder and managing director, Inform Logistics; Stephen Usher, chairman of the HBAA and managing director of House of Usher; and Juliet Price, head of marketing and business intelligence, Hotelzon, for their help with this feature