Before you take your seat at the bargaining table, it's important to know what is and is not negotiable when it comes to planning a corporate event.
While studying for my Certified
Meeting Professional (CMP) designation, my mentor imparted a bit of wisdom that forever changed my understanding of the negotiation process when contracting with venues. When I'm sitting across the table from a venue's sales manager negotiating all the aspects of a corporate event, he or she sees "Total Spend" written across my forehead in permanent marker. In other words, my event's value is simply what it will add to his or her bottom line.
So what's negotiable when you're planning an event or meeting, particularly if the venue is a hotel where you'll also be booking rooms for your guests? More often than not, the answer is one word: everything. And therein lies the problem for everyone but the most experienced event planners. Do you risk asking for too much and not being taken seriously by the venue's sales manager, or not asking for enough and leaving money and perks on the table?
Use the following information as a guideline to help you prepare for your negotiations – and proactively identify what is and is not negotiable to begin with – and you're far more likely to get what you're asking for.
The two largest revenue generators for hotels are guest-room rates and food and beverage (F&B) charges. (I'm purposefully ignoring the resort fees that many properties tack on to every room that are almost pure profit for them and an irritant for guests.) Therefore, your negotiating clout will increase with the number of rooms you fill.
The seasonality and desirability of a geographic location, such as Miami Beach versus Minneapolis in February, have an outsized impact on a venue's willingness to negotiate based on its ability to fill hotel rooms. You usually can negotiate one complimentary room for each 30 to 50 cumulative room nights during your event, depending on whether your hotel is in its high or low season. Stipulate in your contract that the total number of rooms tallied is cumulative throughout your entire event rather than calculated daily, which will result in a higher number of comp rooms.
When negotiating your contract, review the attrition policy for your event. Attrition, the fees charged when you use fewer rooms than were contracted in your room block, will be calculated by the venue as either lost profit or lost revenue. It's better to be conservative with your room-block estimates and add rooms later than be stuck paying attrition fees. Be sure your contract gives you the ability to reduce your room block by specific percentages on set dates prior to your event and that all rooms used by attendees count toward your total room count regardless of how the accommodations were reserved, e.g., through the hotel directly or via an online booking site.
Depending on your total hotel-room spend, negotiable perks can include:
➤ Complimentary transportation to and from the airport
➤ Early or express check-in
➤ Free or discounted use of the venue's fitness center
➤ Free or discounted parking
➤ Upgraded rooms for your on-site staff, speakers, or VIPs
➤ Free in-room Wi-Fi
➤ Late check-out
➤ Discounted or waived resort fees
➤ Complimentary breakfasts
Rental fees for meeting and event spaces can often be reduced by discussing your overall budget. If you're reasonably sure that you will meet your expected number of attendees, you can request that event-space rental fees be tied to your guest-room pickup percentage.
During negotiations, ask if the venue has a list of preferred vendors that you must select from for audiovisual services, internet and/or Wi-Fi, event staging and decor, etc. These suppliers are almost always in a revenue-sharing agreement with the venue and charge significantly higher fees than nonapproved vendors. Always ask to be able to select your own suppliers for any required services. Sales managers will likely balk at this request, but remember (and perhaps drop a not-so-subtle hint) that it's not in their best interest to have you walk away from the entire event based on the pricing of their approved vendors.
Inquire about ancillary event fees that often have a way of mysteriously appearing on your final bill and ask that any inflated or nonsensical charges be reduced or waived. These invoice-padding line items can include fees for such services as:
➤ Room cleaning
➤ Electrical service and hook-up
➤ Internet and/or Wi-Fi access
➤ Loading-dock access
➤ Meeting-room furnishings, e.g., risers, lecterns, etc.
➤ Package/freight receiving
➤ Secure storage
➤ Tablecloths and table skirting
➤ Valet parking for local attendees driving to the event
Finally, most contracts contain a clause that lets the venue change event-space assignments if a more lucrative piece of business comes along, leaving you with a less desirable room after you've already signed on the dotted line. If this would pose a problem with your event, include a "no move" clause in your contract that locks in your preferred meeting space.
Food and Beverage
Next to room revenue, F&B is a hotel's biggest profit center. As such, venues typically set F&B minimums for an event to guarantee they'll meet their revenue targets. Thankfully, there are several negotiable avenues for getting more for your spend, such as:
➤ Ask that the venue counts what your attendees order at any on-site restaurants and bars as partial fulfillment of your F&B minimum.
➤ Work with the venue's chef on menu sharing, i.e., piggybacking on the same menu as another group that will be in-house at the same time to reduce meal-prep labor and utilize a volume discount on ingredients.
➤ If you plan to host a cocktail reception, inquire if the venue will offer wines it is phasing out at a discount.
It's also important to understand the "below the line" F&B costs of your event – namely tips, gratuities, and administrative fees – and how these costs differ. All in all, these additional fees can inflate your final F&B bill by up to 30 percent, so ask your sales manager which, if any, of the following charges are negotiable.
➤ A tip is a small sum of money given voluntarily and directly to someone in excess of a standard charge, generally for performing a service or task or in anticipation of service. It is a supplement to the low income of many F&B service workers. At some restaurants and venues, tips earned tableside (front of house) are shared with those working in the kitchen or bussing tables (back of house). Tips typically range from 15 to 20 percent.
➤ A gratuity can be either a tip or a mandatory percentage of the basic charges and is a payment to recognize good service. It may not be distributed in its entirety to the wait staff and may or may not be taxable, depending on the local tax laws.
➤ An administrative fee, sometimes called a service charge or service fee, is a mandatory and automatic amount added to F&B invoices by the service provider to defray the cost of labor and equipment. I have recently seen this charge go as high as 25 percent of the total F&B bill.
One of my favorite sayings as an event planner has always been, "If you don't ask, you don't get!" While negotiating your way through all of your needs and wants can seem like a daunting task, you'll find that every venue has a little wiggle room in the contracting process.
But don't approach negotiations as just a haggling process where one party has to lose so the other one can win. I can guarantee you'll have a better experience if you build a collaborative relationship with the venue manager, find common ground on what both of you need, and compromise to get to win-win.
CTSM, CEM, CMP, CMM
"The Booth Mom," is an independent exhibit project manager, trainer, speaker, consultant, and an Exhibitor Conference faculty member. CandyAdams@BoothMom.com