Revenue Management Glossary

Wholesale – Transient Sub-segment

Definition

The wholesale market segment, a sub-segment of the broader transient market, are guests who book their accommodations through wholesale travel distributors, such as Tour Operators, OTAs, Travel Consolidators, Destination Management Companies (DMC), group and charter tour companies and incentive companies. These distributors buy large quantities of room inventory from hotels at discounted rates and then resell these rooms to individual travelers or smaller agencies; in some cases, they also package hotel rooms with other travel components like flights, car rentals, and tours.

How to use it

Because the rooms are being bought in bulk and because the sales and marketing is no longer the responsibility of the hotelier, wholesalers typically buy room inventory for a lower rate than standard transient rates. Hotels must carefully manage the inventory allocated to wholesalers, ensuring that they do not excessively discount rooms that could be sold directly at a higher rate, especially during high-demand periods.

Formula

N/A

Related Terms

Occupancy, Tour Operators, Destination Management Companies, DMC, TMC, Travel Management Companies, OTA, Online Travel Agencies, Incentive companies, Charter Tours, Transient Market Segment
I suggest that hotels use the wholesale market (transient sub-segment) to maintain steady occupancy levels, particularly during off-peak seasons or in markets with high competition; however, I they should also carefully monitor their reservations while using this strategy because you want to ensure that you are not blocking higher yielding direct sales.

Hannah Lee

Hannah Lee
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