I recently read an article posted on a social media site
that suggests there are secret ways to work with hotels to lower your event
costs. I wondered how significant these secrets were and asked an industry
expert for his analysis. Tom Berkman, President and CEO of Omnia Housing Services is our
industry expert. Tom is a
36-year hospitality and housing company veteran that created and has overseen
the operation of the THS Company, the nation’s premier sports housing service
and Omnia's parent company.
Fill Need Dates was number one - This seemed obvious to the
author and our industry expert but not me. They explained this applies to event
space not guest rooms. If a hotel is
full due to a large city wide event, its event space (meeting rooms) are likely
not being used. The hotel may be willing to negotiate better rates for this
unused space which can come in handy as long as you don’t need guest rooms.
Check Cancellation Clauses – the author of the article
says to be careful about this important item as it may result in steep
penalties should you need to cancel less than six months from your arrival
date. Our industry expert says his firm
never agrees to cancellation clauses more than 30 days from arrival.
Both the article’s author and our expert agreed the next
several items were standard so we won’t devote much time to them but felt they
should be noted here. They are: Be Aware
of Food and Beverage (F&B) minimum.
Seems reasonable but be aware F&B calculations do not include
gratuity or tax; Understand audiovisual (AV) requirements. Some hotels have a preferred
vendor and may charge you a fee if you use your own; Contract internet upfront. Until recently,
this has been a major cost to your event.
Hotels are better equipped today but be aware of these hidden charges.
Attrition-Lower it – The article’s author suggests a
variety of tips and tricks for calculating attrition penalties should they
occur. Our industry expert tells me they never agree to attrition penalties in
their contracts and feels they could be avoided all together.
Ask for a Resell Clause – This refers to your attrition
penalty but our industry expert reminds us they have no attrition so this clause
is unnecessary.
Leverage Sales Manager – this was more of a tip on how to
work with a sales manager to get the best deal. It sounded more like shopping
for a car as it was suggested it’s better to call at certain times of the month
or quarter when they have to report sales to quota.
While the article offers some things to consider when
negotiating a hotel contract, it seems more complicated than that to me. A
housing services vendor can be a great partner in working through the hotel
selection process and execution of an agreement. If you want to remove the risk from
your organization and increase your reward, that is my best suggestion.
Don Sciolaro
Innovative solutions, strategic planning & management partner
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