Heading into the negotiating season for next year's rates, travel managers and buyers are developing a variety of ways to offset rising hotel costs. Among other options, they are considering heavier use of lower-tier hotels, which can be cheaper but still suitable for business travelers; adding or consolidating preferred properties, depending on their companies' travel patterns and specific local-market conditions; and including amenities like breakfast and high-speed Internet access as part of preferred programs.

Regardless of how they piece together their hotel programs, many managers will sharpen their focus on compliance--through policy revisions, enforcement and communication to employees--to ensure that methods for controlling lodging costs achieve intended results.

External factors that are largely out of client control are not proving kind. The latest reports from hotel companies, travel agencies and other third parties indicate continued rising rates in the healthy lodging sector, with more of the same expected for 2008. The familiar mix of limited supply and strong demand has, in many major markets, led to ever-higher average daily rates. For 2008, BCD Travel anticipates ADR growth of 4.5 percent and American Express Business Travel expects that "negotiating leverage still will be in favor of the hoteliers as opposed to the travel manager," according to Amex hotel practice leader Priscilla Campbell.

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