Hilton Supply Management (HSM) highlights key considerations for hotel owners in search of a strong procurement partner for their next hotel projects.
MCLEAN, Virginia ‒ Whether you’re building your first hotel, growing your portfolio or keeping your hotels competitive through renovations, teaming up with a professional FF&E project procurement provider ensures many benefits. In fact, against the backdrop of today’s fast-evolving global manufacturing and logistics landscape, the absence of a strong procurement partner is a risk many hotel owners likely can’t afford to take.
In the world of supply chain, scale truly matters, and an industry-leading provider is far more likely to have the global supplier backing to secure the products you need, when you need them ‒ and at the price that’s right for your project.
Beyond that, a credible procurement provider should bring far more to the table than fundamental promises of an “on time” and “under budget” completion.
Developers and owners deserve to work with FF&E procurement providers who understand the many nuances of thoughtful and effective procurement. For example, our experts at HSM leverage their hospitality-focused expertise to create FF&E procurement solutions tailored to each specific property’s category, market, target guest and projected budget.
A proven procurement partner will be able to help you zero in on those aspects that matter most to your project, from responsible sourcing to the ability to over-index on a certain aspect of the guest experience.
To help you find the right project services provider to support your next new build, conversion or renovation, keep the following four considerations in mind as you vet prospective partners for your project:
No hidden fees. Constructing or renovating a hotel is a massive investment, which means total pricing transparency is paramount. Reputable procurement services providers will look at your project from a total cost perspective, outlining the true cost of negotiated products and disclosing any fees for compensation up front.
A proven procurement partner will be able to help you zero in on those aspects that matter most to your project, from responsible sourcing to the ability to over-index on a certain aspect of the guest experience.
Linda Theisen
To avoid “sticker shock” as your project progresses, seek out a partner who provides a comprehensive FF&E budget, inclusive of freight, tariffs, duties, taxes and fees, and who possesses the expertise to help you source a quality stay experience that fits well within your budget.
Sourcing for success. The FF&E purchased for your project will be in your hotel for seven-to-20 years and be a key factor of the guest experience.
True strategic sourcing goes beyond getting the lowest upfront price to consider product quality, performance and your total cost of ownership. Suppliers and their products should be thoroughly vetted to ensure the materials used and the manufacturing and assembly process meet brand standard requirements and will stand the test of time.
An industry-leading procurement service provider with size and scale is more likely to have the buying power to deliver highly competitive pricing and the strategic sourcing expertise to comprehensively vet suppliers and products as well as ensure suppliers stand behind those products with extended warranties.
For owners committed to responsible sourcing, a strong procurement partner will use a data-driven approach to work with their vast network of sustainable and diverse suppliers to source the best products for your hotel.
Navigating the global supply chain. Another benefit of working with a professional procurement team is the ability to identify and contract with suppliers in a variety of locations, directing you toward the partners best positioned to meet your needs.
Whether lower cost, highest quality or speed to market is your top priority, a seasoned project team can help you evaluate multiple product and manufacturing options in different locales, mapping out the anticipated cost of goods, total shipping costs and delivery timelines for each prospective supplier.
The global supply chain is constantly in a state of flux as it responds to global conflict, weather, labor impacts, freight capacity and more. The solutions that worked for your last project may not be the best for your next project, so it matters that your sourcing partner can effectively navigate the global logistics landscape and advise you based on your project’s unique needs.
Real-time information at your fingertips. Be sure to select a service provider who can support you with timely and detailed reporting and logistics updates as your project evolves.
Keeping up on market and industry trends including raw materials, labor, tariffs and global demand could prompt a meaningful increase in commodity-based line items within your build budget ‒ and while even the best procurement partner may not be able to insulate you from market-driven pricing hikes, these providers can help you understand the “why” behind changes to your project scope in real time.
Additionally, a proven procurement partner will be able to leverage relationships with a wide network of suppliers, offering you greater choice and control regarding the manufacturing, materials and finished products that best align with your project budget and timeline.
No matter the project, the most important thing to note is that no two properties are created equal. Even the most prototypical brands require customized supply chain solutions to suit their physical location, budgeted spend and the commodities and freight landscape at time of build.
So, whether you’re constructing a new hotel from the ground up, converting an existing property to a new brand or renovating a hotel to maximize revenue, take the time to engage potential project procurement partners about the full spectrum of services and supply chain solutions each can provide. By aligning yourself with a provider who understands — and can deliver on — your overarching vision and expectations, you can maximize your return on investment, protect your project’s bottom line and deliver a superior stay experience for future guests.
Linda Theisen is vice president, HSM Americas.
The views and opinions expressed in this content do not necessarily reflect the opinions of Hotel Investment Today by Northstar or Northstar Travel Group and its affiliated companies.