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  1. Market Data
January 12, 2012

Hotels unlikely to benefit from bigger business travel budgets

Business travel buyers may receive extra budgets for 2012, but the extra money will not necessarily end up in the hotel community, a Business Travel Show study has revealed.

Business travel buyers may receive extra budgets for 2012, but the extra money will not necessarily end up in the hotel community, a Business Travel Show study has revealed.

Of the 252 buyers surveyed, one quarter confirmed that for 2012 their budgets will increase, while 15% stated they would have less money. Nearly 46% will see no change, despite 27% of buyers booking more travellers into lower-class hotels.

Business Travel Show event director David Chapple said buyers are still under massive pressure to cut costs and stretch budgets. Other issues include the impact of the Olympics on hotel availability, the introduction of stronger travel policies, the economy and the rise in travel alternatives.

"As we head into a year of economic uncertainty and increasing hotel, fuel and ancillary fees, such as APD, it’s no surprise that buyers are worried about keeping costs down," Chapple said.

The surveyed business travel buyers said that the biggest change in their buying for 2012 will be greater cost scrutiny (40%), followed by enforcing policy compliance (21%), fighting for more from suppliers (19%), introducing new technology such as online booking and mobile (17%) and increasing the use of travel alternatives (3%).

In order to manage costs closely and reduce demand for travel, 99% of buyers are using travel alternatives as frequently as they did last year.

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