Download - Contract Negotiation For Meeting Planners
Our current time
in the area of
hotel proposals and contracts
are different than they’ve been
in the recent past.
The economy’s pick-up has put
the hotel industry
back in the driver’s seat
and the planners are experiencing
a seller’s market.
Start With a Solid RFP:
● Provide history, pattern, flexibility, audience, and decision making
process and timeframe
● Disclose important decision making factors
● Always have a conversation with the Sales Manager
● Compare all RFPs side-by-side to allow for best negotiating
between properties
● No charge from in-house AV nor security for utilizing an outside AV
provider
● 1:40 comp/1:35 comp
● Free meeting space
● Site visit / staff guest rooms at no cost
● Wifi
● Discounts from catering, AV, outlets, etc.
● Etc.
Consider Concessions You May Want:
● Request rebates / commissions
● Include mutual indemnification clauses
● Review payment terms for hotel based on client’s cash flow
● Add in rebooking clauses
● Request that meeting rooms cannot change without written
permission from the client.
More Items to Consider:
Be prepared to sign contracts quickly
because demand is high and availability is low;
and ask for “signing bonuses” if the sales manager is under pressure
to meet month/quarter deadlines.
Act Fast!
Let’s Help The Venue – Everyone Wins!
Ask what holes need to be filled if dates are flexible;
you might have a better value contract
if the hotel needs to fill a specific “niche”.
Legal Issues
● Understand the importance of a written agreement and appreciate the
potential for litigation as a worst case scenario
● Always maintain a good paper trail
● Use caution when negotiating non-economic items (e.g., risk
management)
Room Block Attrition
● Right to reduce before?
● Minimum pickup
● Per night or cumulative?
● Dollar multiplier – lost profit vs. lost revenue
● Treatment of resold rooms
● Right to audit pickup and resell numbers
● Credit for all group rooms regardless of rate paid or method of
reservation
Function Space Attrition
● Watch for attrition issues
● Other groups
● Conflict avoidance
● Specify groups
● Reassignment of space
● No reassignment without prior written consent
● Quiet Enjoyment
● Cover noise, odors, dust
Force Majeure
● Acts of God
● Acts of War
● Strikes
● Other
● Not poor attendance or business conditions
Common Force Majeure Issues
● Illegal or impossible
● “Grocery list” with “catch all” statement
● Standard of impact
● Perform anyway
Construction or Renovation
● Notice
● Group gets to decide whether construction will impact its meeting
● Specific representations for known construction projects
Strike or Labor Dispute
● Cover both legal strikes as well as any type of labor dispute
● Disruption in services
● Notice and right to decide if it will impact meeting
Change In Management
● Could be management company or rebranding of hotel within
management company family
Cancellation by Group Without Cause
● Sliding scale
● Negotiate date parameters
● Fee based on lost profit or revenue? Include food and beverage?
Cancellation by Hotel Without Cause
● “Grocery list” approach
● Include indirect and consequential damages and attorneys’ fees