In the previous articles, we outlined two structural realities. First, that procurement inefficiency can erode 6–16% of EBITDA in a typical hotel. Second, that independent hotels are more exposed to this issue due to a lack of structure, visibility, and integrated procurement models.

For many operators, the natural next step is to look towards Group Purchasing Organisations (GPOs) as a solution. At face value, this appears logical. However, in practice, these models are often less effective for independent hotels and portfolios than expected.

A key indicator of this lies in their origins. Most GPOs have emerged either as extensions of major hospitality brands or as service spin-offs from large catering companies.

While they can be effective partners in certain contexts, they often create structural challenges for independent hotels over the medium to long term.

In the previous article, we outlined how procurement inefficiency typically results in a hotel leaving 6–16% of EBITDA on the table.

While the issue exists across the sector, it is consistently more pronounced in independent hotels and portfolio groups.

The reasons are structural—but critically, fixable.

Hotel management teams are by necessity, highly focused on revenue performance.

Occupancy, average daily rate (ADR), and channel mix dominate internal discussions, supported by increasingly sophisticated revenue management tools. In a competitive and often volatile market, this focus is entirely rational.

Where attention turns to cost, it tends to centre on the most visible and immediate pressures—namely labour and energy. Both are significant, both have been subject to sharp inflation in recent years, and both sit clearly on the operating cost line.

However, beneath these headline categories sits a less visible, but equally material, area of financial performance: procurement.

In many hotels—particularly independent hotels and smaller portfolios—procurement remains structurally under-managed. The result is not typically a series of poor decisions, but a gradual and compounding erosion of margin that often goes unnoticed