Wholesaler

In the current context of travel technology, the most obvious form of wholesaler is the Bed Bank (e.g., Hotelbeds, WebBeds). These companies have huge global inventories, and they contract with thousands of hotels to be able to offer rooms at a price that is much lower than the public rate (often 20–30% lower).

They work on a volume basis.

• For suppliers (hotels): The wholesaler is a supplier of base load occupancy. They help hotels fill up the rooms in low seasons or reach international markets (e.g., a Chinese agency booking a hotel in Paris) that the hotel could not market to directly.
• For sellers (agents/OTAs): The wholesaler offers a one-stop-shop. Instead of entering into 10,000 individual contracts with hotels, an OTA simply hooks into one wholesaler API and suddenly has access to all the global inventory.

Historically, wholesaling was a paper-based business using Static Contracts.

The Old Way: A hotel would sign a contract with the wholesaler where they would give 10 rooms a night at $100 for the entire year. These rates were both fixed and manually loaded.

Today, the sector is based on the idea of Dynamic Connectivity.

The New Way: Wholesalers are connecting directly to the hotel’s CRS (Central Reservation System) or Channel Manager using XML/API. This allows them to pull dynamic rates (which change according to demand) and live availability. This shift has made wholesalers enormous technology aggregators that process billions of search queries (look-to-book) a day.