Contracting a hotel block and meeting space is a very typical job of a meeting professional. That's why I wanted to make sure that it was part of last week's NC SGMP Conference. We had two planners, two hoteliers, and a CVB representative speak on a panel about contracts. The information that was shared proved to be one of the most valuable parts of the conference.
Our hoteliers talked about how force majeure is part of a hotel contract to protect both them AND the meeting planner. This was an important fact to remember because often times the perception (at least from the point of view of the meeting planner) is that we are almost never able to get out of a contract because of force majeure. However, we talked about a scenario where the meeting planner's attendees were affected by a state of emergency from a weather situation. I hadn't thought about this type of scenario before. More or less, if participants of your conference are not able to get on a plane to fly to their destination it may be cause for force majeure to be enacted. Of course, it is also true for the hotel, that if they are in this type of situation and are not able to provide the service expected it is cause to enact force majeure.
Something else I learned during this discussion is that during situations like the ones that took place in Baltimore and Ferguson recently, it does not necessarily fall under force majeure. When Baltimore had a curfew and was deemed in a state of emergency, force majeure could be enacted, but after the curfew was lifted, by law of the contract, hotels were not obligated to cancel the contract. However, some hotels will agree to reschedule conferences to another time because of the perceived fear surrounding the events that are taking place.
Meeting planners may have the perception that sales managers at hotels are after every piece of business. I learned that while they are after business, not every piece of business is worth it having. One example that came about was having both a police officer conference and a protest group at the hotel at the same time. It wasn't that the hotel didn't want to host these groups, but it wouldn't be in the best interest of the hotel to have these groups possibly intertwine during their stay. I have a lot of respect for the selection that they go through when it comes to hosting groups.
On the flip side, I asked the planners what drives their decision to select a hotel. For planners, the answer is not just about price. In fact, planners often have a list of requirements that they are seeking in a particular hotel. If the hotel satisfies all the items on the list, planners are likely to pay more to have access to the services offered rather than opt for the lower price.
Our CVB panelist said it best when she said, sharing information about what is important to your group, and about your budget is all helpful information to promote a positive relationship amongst planners and suppliers. She mentioned that as a CVB she would help be the gatekeeper for the hotels and the planners and would not send RFPs to hotels that wouldn't fit the bill.
I urge planners and suppliers alike to continue to keep these lines of communication open. Remember, putting your needs on the table before you sign a contract is negotiating, asking for it after a contract is signed is begging. It's better to negotiate than it is to beg. More on negotiating in a future post!
Force Majeure
One of the biggest surprises to me came from the discussions about force majeure. Of course, force majeure meaning "act of God" situations that prevent an event from taking place. It is a set of circumstances that is independent of the will of man, that is not in his power to control.Our hoteliers talked about how force majeure is part of a hotel contract to protect both them AND the meeting planner. This was an important fact to remember because often times the perception (at least from the point of view of the meeting planner) is that we are almost never able to get out of a contract because of force majeure. However, we talked about a scenario where the meeting planner's attendees were affected by a state of emergency from a weather situation. I hadn't thought about this type of scenario before. More or less, if participants of your conference are not able to get on a plane to fly to their destination it may be cause for force majeure to be enacted. Of course, it is also true for the hotel, that if they are in this type of situation and are not able to provide the service expected it is cause to enact force majeure.
Something else I learned during this discussion is that during situations like the ones that took place in Baltimore and Ferguson recently, it does not necessarily fall under force majeure. When Baltimore had a curfew and was deemed in a state of emergency, force majeure could be enacted, but after the curfew was lifted, by law of the contract, hotels were not obligated to cancel the contract. However, some hotels will agree to reschedule conferences to another time because of the perceived fear surrounding the events that are taking place.
Selecting Business and Hotels
I asked the question of the hoteliers on the panel to provide me a reason that they might say "no" to certain business. Of course, some of the reasoning involves space constraints and previously booked groups. There was one response that I thought was unique. It was the thoughtfulness about the type of group they provide a proposal for.Meeting planners may have the perception that sales managers at hotels are after every piece of business. I learned that while they are after business, not every piece of business is worth it having. One example that came about was having both a police officer conference and a protest group at the hotel at the same time. It wasn't that the hotel didn't want to host these groups, but it wouldn't be in the best interest of the hotel to have these groups possibly intertwine during their stay. I have a lot of respect for the selection that they go through when it comes to hosting groups.
On the flip side, I asked the planners what drives their decision to select a hotel. For planners, the answer is not just about price. In fact, planners often have a list of requirements that they are seeking in a particular hotel. If the hotel satisfies all the items on the list, planners are likely to pay more to have access to the services offered rather than opt for the lower price.
The Most Important Factor
So how can suppliers and planners work more productively together? One word: COMMUNICATION. When it comes to having to cancel an event, communication is key. When it comes to saying no to certain business, communication is everything. When it comes to looking for business, again, communication. Being able to offer different dates or negotiate services can make or break proposed contracts.Our CVB panelist said it best when she said, sharing information about what is important to your group, and about your budget is all helpful information to promote a positive relationship amongst planners and suppliers. She mentioned that as a CVB she would help be the gatekeeper for the hotels and the planners and would not send RFPs to hotels that wouldn't fit the bill.
I urge planners and suppliers alike to continue to keep these lines of communication open. Remember, putting your needs on the table before you sign a contract is negotiating, asking for it after a contract is signed is begging. It's better to negotiate than it is to beg. More on negotiating in a future post!