When the storms of COVID-19 started to calm down and hotels began welcoming the guests, a new form of payment known as hotel prepayment sprouted out. Corporate benefited highly from these payment options as discounts are one of the most common perks. Prepayment helps employees stay safe and cut down on the time spent waiting in a queue for paying the tariff of the room. But before digging out the benefits of hotel prepayment for corporates, let us understand the basic definition of hotel prepayment.
What is prepayment?
Though it has gained popularity in recent times, hotel prepayment has been in the market since the advent of online hotel booking. As per the general definition of prepayment, it is paying for something or any service before you get or experience it. Therefore, hotel prepayment means paying the tariff of the accommodation before actually occupying it in person.
How does prepaid hotel booking works?
With the revolution in booking technology and digital banking, scouting and securing hotel rooms have become easier than ever. Travel managers or tour operators can compare rooms and amenities through booking platforms, select accommodations as per requirements, and directly pay the balance online. Conclusively, the employees will have a room ready for themselves as soon as they reach the hotel on the date of booking.
Suggested Read: Corporate Lodging Solutions: Perks On Hotel Bookings
Advantages of hotel prepayment
From maintaining travelers’ comfort to handsome discounts, prepayment offers numerous benefits to both travelers and corporates. Here are some of the top advantages of hotel prepayment.
1. Discounted tariff
Filling up the rooms in advance ensures a sure-shot tariff for the hotels. Hence, the hotels provide discounted rates to the guests who pay in advance. Further, as many of the hotels use strict cancellation policies for prepayment, it reduces the risk of no-shows while ensuring secured revenue in advance. That is the reason, hotels giveaway heavy discounts on the rooms. Corporate can use this to their advantage and book rooms at lower prices if the itinerary is less likely to change in the future. Also, hotel room tariff is dynamic in nature; generally, the earlier you book the better rates you avail.
2. Better trip budgeting
Preplanning is always fruitful while carrying out cost-intensive trips. Therefore, a component of the trip budget can be fixed by allocating and finalizing the accommodation expenses of the employees on business trips. Further, it will ensure that hidden or upfront cost is taken from the employee that corporates might have to reimburse afterward.
3. Convenience of booking
Prepay for hotel room gives you the freedom from calculating and settling down the expenses while checking out from the hotel. It is a great option for people who like to travel stress-free and put peace of mind and staying experience above everything else. Moreover, it saves valuable time for the employee on a corporate trip that otherwise may get destroyed waiting in a long queue and completing hotel formalities.
4. Room availability guaranteed
Most travelers and corporates have volatile plans. Therefore, they prefer last-minute bookings. This paves the way for guaranteed availability in any hotel while booking in advance. It will also help you get better prices that otherwise would be subjected to a great surge as per the supply and demand principle.
5. Higher itinerary adherence
As mentioned before, hotels maintain strict cancellation policies for prepayments. This infers that bookers can only avail of partial or in many cases no refunds. Hence, corporates have to follow the schedule as the only resort if they don’t want to lose out on the cost of the booking. In turn, employees have to stick to the itinerary set by the businesses for them and fulfill the purpose of travel.
Suggested Read: Top 8 Tips To Streamline Hotel Group Booking For Corporates
Disadvantages of hotel prepayment
While there may be many benefits of prepayments, there are several downsides as well. Listed below are some of the disadvantages of prepayments:
1. Non-refundable
One of the major disadvantages of prepayment is that it is either partially refundable or non-refundable. In case there is a change in the itinerary or plan, corporate are bound to lose a hefty sum of money.
2. Limited flexibility
Booking before the travel or trip date can limit the changes in the itinerary. This will leave travel managers and corporates with restricted options while carrying out or making changes to these plans.
3. Missed opportunities
Generally, hotels offer great discounts during the holiday season. Prepayment can lead you to miss out on such opportunities and cost more than booking during the peak season.
4. Restricted options
As a standard offering, hotels lock their premium rooms to rent them at surging costs during peak timings. Hence, during prepaid bookings, some of the rooms may be unavailable on travel booking engines and platforms.
Conclusion
Amongst the toughest challenges for travel managers, booking the right accommodations easily ranks in the top five of them. Hotel prepayments can smoothen the overall process and help manage accommodation booking the corporate travel.
Hotel Prepayment FAQs
What is hotel prepayment?
Hotel prepayment is the act of paying the tariff in advance before checking in or reaching the hotel.
What are the advantages of hotel prepayment for corporates?
Hotel prepayment offers numerous advantages such as discounted tariffs, better trip budgeting, convenience, guaranteed availability, and higher itinerary adherence.
Can prepayment help manage hotel booking for corporate travel?
Yes, hotel prepayment can help smoothen the overall process of managing accommodation booking for corporate travel.
