Corporate travel buyers are wrestling with soaring hotel prices and a desperately short supply of rooms in many big cities at times of peak demand. They are coming under increasing pressure to shift from fixed rate deals to dynamic pricing, which renders their costs subject to market fluctuations and makes budget planning difficult, if not impossible.
Some are asking travel management companies to block book rooms in advance to be sure of getting accommodation when big conventions and exhibitions are soaking up supply. In some instances requests for rooms on the busiest nights – Tuesday and Wednesday – are being refused unless guests also stay on Monday or Thursday, when demand is generally weaker. Against this background, last room availability (LRA), which usually means companies are guaranteed an agreed rate in a particular room category, even if there is only one such room left, has become much harder to negotiate.
