Travel & Hospitality Tech Outlook | Tuesday, August 08, 2023
Digitalization can unlock an actual bird's eye view of any hospitality brand, regardless of size and scale.
FREMONT, CA: The hospitality sector has embraced sustainable buying for the past ten years. In many hotels and casinos, supporting various sustainability goals, such as lowering environmental impacts and boosting community economic growth, has replaced price and quality as the main deciding factors when making purchases. With this change, the procurement department has advanced beyond its purely transactional focus on investment to become a strategic business partner capable of fostering the organization's sustainability, cost savings, and efficiency.
The intricate, anticipatory nature of this economy sector necessitates a data-driven aerial picture of a property's operations, which can only be attained by integrating eProcurement technology into the current hospitality procurement procedures. Using this technology, companies, visitors, and other participants in the value chain can consolidate and automate interactions to improve procurement speed and effectiveness.
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By automating conventional procurement processes, eProcurement software eliminates the need for paper-based operations, increases procurement practices’ speed and efficiency, and aids in analyzing spending to identify significant cost-reduction opportunities. Nevertheless, eProcurement's contribution to sustainability goes far beyond reducing paper use!
Growing eProcurement
A trillion dollars in sales will be generated by e-procurement this year. E-procurement emerged as one of the fastest-growing digital commerce sales channels in 2021. E-procurement presently accounts for 8.5 percent of all electronic sales and 7.1 percent of all B2B sales, representing an industry growth rate of 17 percent throughout 2022.
Procurement firms focus on simplifying and streamlining intricate procurement procedures lacking automation and integration, particularly in hotels and casinos. By abandoning manual procedures, hospitality brands have access to a centralized, comprehensive picture of their data, which improves budgeting and purchasing accuracy.
Hospitality brands can take advantage of the speed and ease of digital tools to increase visibility and optimize spending with a suite of comprehensive e-procurement tools, including purchasing requisitions, RFQs, supplier catalogs, transaction tracking, budget analysis, advanced workflow approvals, and more. COVID-19 has caused financial hardship for hospitality businesses over the last two years, which could be countered if rogue spending and workflow inefficiencies are reduced.
Hotel brands will also increase their use of e-procurement technology in 2023, as there will be a curb on unauthorized expenditures, the procurement process will speed up, inventory management and contingency planning will improve, touchless procurement will be available, and it will be possible to enhance supply chain transparency and protect sensitive data through block chain technology.
The Long-Term Trickle-Down Impact of Electronic Procurement
The emphasis on sustainability is one of the most important trends in hospitality procurement. Customers are putting increasing pressure on the hospitality sector to implement eco-friendly policies and practices, which has become a top trend. In particular, casinos and hotels must meet rising visitor demand for environmentally friendly solutions. The sustainable tourism industry is anticipated to expand at a compound annual growth rate of 23.4 percent in the upcoming years.
Brands in the hotel industry need to consider how their operations affect the environment and, more significantly, how they can change or replace old procedures to be more environmentally friendly. Although there are many aspects to sustainable practices in hotels and casinos, it's crucial to remember that suppliers account for two-thirds of the average company's environmental, social, and governance footprint. Similar to how major businesses are expected to reduce their considerable environmental impact by taking the initiative, hospitality brands must select suppliers with a history of sustainable behavior (environmental, social, and corporate governance credentials).
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