Travel & Hospitality Tech Outlook | Monday, January 31, 2022
Sustainable procurement has become a staple of the hospitality industry over the last decade. Hotel and casino purchasing criteria are no longer solely based on price and quality but on supporting environmental and community economic development objectives.
FREMONT, CA: The hospitality industry has embraced the concept of sustainable buying throughout the past decade. In many hotels and casinos, the key purchasing criterion is no longer a product's price and quality but rather its contribution to various sustainability goals, such as decreasing environmental consequences and fostering community economic growth. The procurement function has shifted from a purely transactional focus on purchase to a strategic business partner capable of driving efficiency, cost reductions, and sustainability throughout the firm.
This market segment's complex, anticipatory nature necessitates a data-driven, bird's-eye perspective of a property's operations, which can only be achieved by adding eProcurement technology to current hospitality procurement processes. This technology is intended to centralize and automate interactions between a company, its guests, and other value chain partners to increase the speed and efficacy of procurement procedures.
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eProcurement software eliminates paper-based operations by automating traditional procurement processes, facilitates spend analysis for strategic cost-savings, and enhances the speed and efficiency of procurement activities. But eProcurement's contribution to sustainability goes far beyond paper conservation.
The Sustainable Trickle-Down Effect of eProcurement
Sustainability is one of the most significant trends in hospitality procurement. The hospitality business is under increasing customer pressure to embrace eco-friendly policies and practices, which is currently one of the most prominent trends. Especially hotels and casinos must meet the growing demand for sustainable solutions among guests. Between 2022 and 2032, the market for sustainable tourism is anticipated to expand at a compound annual growth rate (CAGR) of 23.4 percent. The category is also anticipated to grow by one-third by the end of this year, surpassing $1 trillion in value and reaching $8.4 trillion by 2032.
With this in mind, hospitality brands must examine the impact of their operations on the environment and, more significantly, how they may modify or replace outdated procedures to become more environmentally conscious. Note that two-thirds of a typical company's environmental, social, and governance footprint is borne by its suppliers. Similar to how large firms will balance their substantial climate impact by taking the lead on environmental causes, hospitality brands are responsible for selecting brands with a track record of sustainable responsibility during procurement (environmental, social, and corporate governance credentials).
Now, more than ever, hotels and casinos must adopt a 'top-down' approach to sustainability by maintaining ESG considerations at the center of their procurement strategy and using sustainability criteria as a critical differentiator when recruiting suppliers. With the introduction of eProcurement technology, hospitality businesses can now achieve supply chain sustainability at scale, a feat that may have been difficult, if not impossible, to accomplish with manual procurement efforts.
Hospitality brands of any size and scope stand to profit from digitizing their procurement processes to gain a genuinely intuitive, efficient, and future-proof organization-wide perspective. It is time to acquire and conquer, namely, e-procure and conquer.
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