Negotiating with Hotels: In Search of the Win/Win
17 Jul, 2018By: Tina Horn
As an event owner and as the person who is present and working from start to finish, you’re used to multitasking. You may even be used to dealing with difficult people in tough situations, and in having to solve those last-minute problems that pop up.
Why is it, then, that you hesitate when it comes to negotiating with hotels for your event?
You’re not alone. Many people find the concept of negotiations – including making calls, reviewing contracts and (gulp!) signing them – to be unnerving. But whether they’re balking at doing something that seems to be legal in nature or whether they’re afraid of opening themselves up to possible financial penalties by misreading the fine print, the hesitation to engage in negotiations continues.
Make no mistake: there are professionals in the industry who specialize in event planning and often their expertise includes hotel negotiations and contracts. But even if you’re not one of those, you can still achieve success – and maybe score a degree of confidence as a result. All you have to be is attentive to detail.
Create a Request for Proposals
Yes, you’re going to do this. Here’s how. Sit down and type up the following:
• The full title of your event: The XYZ Swim Meet, for example
• A brief description of it: This annual event, which takes place at the ABC Swim Center, brings together (number of) swim teams, all age 15U. Athletes travel with at least one parent each.
• The dates it will be held
• How many room nights you assume you’ll need, based on any past history you may have
• Move-in/Move-out pattern: Adhere to the ‘best surprise is no surprise’ adage. You’ll want to make sure the hotel understands the nature of your event so there are no misunderstandings about room night use. If, for example, your event is a tournament that has a single-elimination format, it can lead to teams leaving sooner; you should be able to factor the start numbers and the amount it is expected to decrease day over day. If you have pool play, more teams will be in town for a guaranteed amount of time. When is the earliest they’ll be leaving? Is there any chance they’ll stick around for the final, even if they’re not playing it? Study your history and find out
• Any preference on room types: double/double, etc. (If you expect your athletes and families to request items like roll-away cots or rooms with pull-out sofas, note this on the RFP. If a hotel does not have access to such furnishings, it will be essential to know this at the outset.)
• Request for any additional space, such as meeting rooms for officials, parents, coaches or anyone else involved with the event
• Spending history: This is particularly valuable. For example, if the previous host hotel had a bar or restaurant(s), get the information on how much was spent by your group over the course of the event. Good income can make your contract very appealing to the hotel and provide greater negotiating power.
Those facts will make up the basic structure of your RFP. It will allow hotels to evaluate your needs and their availability and get back to you.
A valuable resource to you will be the CVB or the sports commission in an area. The professionals in these groups can help you direct your request to the appropriate lodging facilities since they’ll have a better understanding of what is near your venue and what will make the most sense, given your group’s specific needs.
Once you have replies in hand from several hotels, you’ll want to evaluate them. There are many criteria to consider, but chief among these should be their juxtaposition to the venue you’re using, the room rate and whether the hotel is convenient to restaurants, shops and other entertainment. If your athletes are driving in with their parents, for example, check on the availability and cost of parking. If they’re flying in, see if there is shuttle service to and from the airport. If you have a team bus, ask about parking for it. Does the hotel offer a free breakfast? Evaluate proposals so you are comparing hotels fairly.
Assuming you have decided upon a preferred hotel, it’s time to get down to the actual business of negotiations. Remember that unlike sports, this isn’t a win/lose situation. In negotiations, both the hotel and the event need to come out on the winning end. This is best accomplished when each side gives a little.
Take a hard look at what you’re requesting. What is essential, what is nice to have and what can you do without? Since negotiating is all about giving something to get something, start with your third category. The hotel representative will be looking at the same options.
By now, you have a contract. And while it’s easy to get butterflies in your belly looking at the fine print, try to view it as a work in progress. Here are some of the things you’ll want to review (once you have ascertained that all the information on your event, as presented in the RFP, is stated correctly):
• Make sure the hotel has stated correctly which charges are to be put on the event’s master account (for example, catering, banquet space rentals, etc.) and what guests are responsible for (nightly room charges, room service, dry cleaning/laundry, etc.)
• Cancellation penalties, particularly if you’re negotiating a year or more in advance
• Room block release date (that is, when the hotel stops holding hotel rooms exclusively for your group and makes those rooms available to the public; usually, this is 30 days prior to the start of the room block); check also to see whether reservations from your group that arrive past that date can receive the rate you negotiated.
• Any language locking you into payment for the entire room block or penalizing you for shortfall; if such language exists, you may want to see if it’s negotiable. If it’s not negotiable, make your room block lower and ask for the flexibility to have people still be able to access the group rate if the room block fills early but rooms are still available in the hotel.
• Whether room rates stated on the contract are inclusive or exclusive of taxes, etc.
Read the contract carefully and see if the following information is included. If not, ask – and then ask for an updated contract that reflects the information:
• What will happen if the hotel suddenly finds itself unable to accommodate one or more of your participants, who then needs to be moved to a different hotel? (Hotels call this ‘walking,’ by the way.) What hotel will they be in? Will they have transportation to and from all the sports events? How will they be compensated? What room rate will they be paying?
• If a participant has to leave unexpectedly in the middle of the tournament, does the hotel add penalties for early departure?
• Does the hotel have construction planned for that time or space, or even nearby? If construction is planned, where in the hotel will it be? Can your people be located away from it?
• Are there charges for Wi-Fi (and if so, are they per room, per guest or per device)?
• Are there any other groups in-house that would constitute a problem or a distraction to your group? While you can’t tell the hotel to relocate guests who are already contracted for the same hotel, you can look for a different property, if necessary.
If there is language on the contract you don’t understand, don’t be afraid to ask the hotel to clarify it. If you have a corporate attorney, you can always ask that person to review the contract for you as well.
When you go to the table, as it were, to discuss the contract with your hotel representative, remember that they want your business as much as you want a place for your athletes to stay. You wouldn’t be talking if this were not the case. Work together to craft a mutually agreeable arrangement and you’ll create a relationship with your new business partner that can pay dividends if your event comes back into town in the future. SDM