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Hospitality Business Review | Sunday, March 13, 2022
Players in the hospitality industry benefit from digitizing their procurement efforts to leverage an intuitive, efficient, and future-proof approach.
In the hospitality industry, sustainable procurement concepts are becoming increasingly popular within the hospitality industry over the last decade. A hotel's primary purchasing criteria are no longer price and quality but also supporting many sustainability objectives, such as reducing environmental impacts and enhancing local economic development. It has evolved from a transactional function focused on purchasing to a strategic business partner that helps organizations optimize their operations, save money, and be more sustainable.
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E-procurement technology centralizes and automates interactions between organizations and guests to improve the speed and efficiency of procurement practices. E-procurement technology centralizes and automates interactions between organizations and guests.
E-procurement trends: It is one of the fastest-growing digital commerce sales solutions. In 2022, E-procurement grew by 17 percent, accounting for 8.5 percent of all electronic sales and 7.1 percent of all business-to-business (B2B) sales. Procurement companies aim to simplify and streamline complex procurement processes, which must be automated and integrated with hotels. Hospitality brands stand to unlock a centralized, holistic view of their data, leading to enhanced purchasing and budgeting accuracy by eschewing traditional procurement methods.
To maximize visibility and reduce spending, hospitality brands can leverage the speed and ease of digital tools to enhance e-procurement, including purchasing requisitions, request for quotes, supplier catalogs, transaction tracking, budget analysis, workflow approvals, and more. Hospitality brands can effectively offset financial challenges from recent economic events by mitigating spending and workflow inefficiencies through E-procurement technologies. Hospitality brands can save money and increase productivity using a new-age E-procurement platform. With E-procurement technology, hospitality brands will reduce rogue spending, shorten procurement cycles, improve inventory management, and contingency plans, enable touchless procurement, and explore how blockchain can protect sensitive data and improve supply chain transparency to manage future unpredictable changes.
Sustainability: Sustainable procurement is one of the popular trends in hospitality E-procurement currently. It is becoming increasingly popular as customers pressure the industry to adopt eco-friendly policies and practices. Hotels must improve their game to meet the growing demand for sustainable tourism. Research shows that from 2022 to 2032, the sustainable tourism market can grow at a compound annual growth rate (CAGR) of 23.4 percent. The segment may grow by a third, reaching USD 1 trillion. The market can reach USD 8.4 trillion by the end of 2032. Studies also show that 81 percent of travelers are concerned with sustainable travel. A third of global travelers believe accommodations and transport providers are significant in their property and transportation decisions.
The hospitality industry must therefore consider how its operations impact the climate and what changes and replacements can make ongoing processes more environmentally friendly. Hotel and casino sustainable practices are varied, but it is important to note that suppliers contribute two-thirds of the average company's environmental, social, and governance footprint. Hospitality brands must choose brands during procurement that have a proven track record of sustainability, such as in the form of environmental, social, and corporate governance credentials, much like large corporations are expected to offset their significant climate footprint by taking the lead on environmental issues.
A top-down approach to sustainability is now an essential criterion for hotels. They must keep environmental, social, and governance considerations at the center of their procurement strategy and make sustainability measures a vital differentiator when sourcing suppliers. With the increasing adoption of E-procurement in the hospitality industry, brands of all sizes and scale benefit from digitizing their procurement efforts while leveraging its efficient and future-proof solutions.
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