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Tyra Warner, Jeff Duncan, and Lauren Andrews led a session on event contracting during October's IMEX America show in Las Vegas.

Event-Contract Sticking Points: A Practical Approach

Three industry veterans share their advice on crafting contract terms and clauses that meet the needs of host groups, not just host venues.

Right now, the meetings industry’s landscape features high demand, rising prices, and hotel reps’ relative inexperience with meetings, all of which make planners’ jobs more difficult than ever.

To help cut through the thicket of contractual issues within this landscape, three longtime meeting negotiators—Tyra Warner, Lauren Andrews, and Jeff Duncan—held a discussion at the recent IMEX America show in Las Vegas that detailed several planner strategies for getting the event elements they need at prices their bosses can live with.

The first thing the trio addressed was how to get hotels to respond to planners’ requests for proposal in a timely and productive manner. Lauren Andrews, the owner of event-management firm EvSo, noted that the traditional tactic of spelling out most or all of the concessions you want is likely to bring a lackluster response from today’s hotel sales departments. In short, “younger reps might simply pass on taking up your RFP” because there are others coming across their desk with fewer “asks,” and they might not know enough about different event elements to find a middle ground between their hotel’s position and the potential client’s position. Andrews says that planners “must prioritize their concessions in an RFP so that they at least get a counteroffer.”

Another tactic, said Jeff Duncan, president and CEO of room-block management firm Meetingmax, is to put forth a “BATNA,” or best alternative to a negotiated agreement. “You can use another hotel’s offer as leverage with your first choice of venue: ‘Here are the terms I’ve gotten from another hotel we’re considering; can you do a bit better?’ Worst case, you have that alternative if your first choice does not come close to the terms you want.”

Andrews added that “using an offer from a hotel in a city one tier below your target property could get the target property to move towards your terms. And if your target property says no,” then your group could opt to be a big fish in the smaller pond that is a second- or third-tier city.

Duncan warned, however, that “if you try to bluff your top hotel choice about having a BATNA but the property won’t budge, you could find yourself looking for a host venue on shorter notice,” which might well result in less favorable contract terms than you would have gotten in the first place.

Locking Things In
“Shifting the event schedule a day or two to get on a hotel’s preferred pattern or to fill a hole goes a long way toward getting the concessions you want,” Andrews said. But regardless of whether your event is on pattern or off pattern, Duncan said to “get into your contract the lowest rate that will be available at the hotel over your dates so that it won’t be lower than your group rate. Also, get your pre- and post-event rates hammered out so your attendees have the ‘bleisure’ option around your meeting.” He noted, though, that most hotels won’t offer favorable rates more than two days before or after a meeting, and more often are agreeing to just one day on either end.

Tyra Warner, a meetings-industry attorney and department chair of Hospitality & Tourism Management at the College of Coastal Georgia, emphasized that “planners must make sure their contracts spell out the consequences for rate breaches by the hotel—remedies such as a free reception, or a discount on the master account, or an adjustment to the lowest rate for all your attendees.”

Warner also advised planners to secure specific staffing levels and hours of operation in the contract so that unexpected closures or reduced hours at dining outlets or other property offerings don’t happen during the event. And for event services, Andrews said that “you could ask for at least one hotel employee to conduct check-in for your attendees at an auxiliary desk, so that they aren’t waiting for 30 minutes at the front desk” because of hotels’ persistent staffing issues right now.

For attrition clauses that aren’t onerous to the group, Duncan said that using ChatGPT, Spark, or another generative artificial-intelligence platform could deliver a planner samples of attrition clauses that at least some hotels have agreed to in the past. (Click here for MeetingsNet’s coverage of planners using A.I. to build, market, and analyze their events.) Such clauses should include “not having attrition kick in until the event actually begins, and making sure the attrition remedy for the hotel is based on their lost profit, not their lost revenue," he noted.

Here's an interesting wrinkle on creating force-majeure clauses: Because it’s possible that there could be a change to a law in the host destination that would be objectionable to a group and its attendees, “make sure to list your ‘absolutely not’ scenarios in the contract,” Andrews said. “That could be for specific local laws or for the types of groups that might share a property’s meeting space with you.” Warner added that “groups should define the discriminatory laws that, if passed, they would not abide. Doing this can make it a force-majeure situation” if such a law does pass before the meeting.

However, all three experts emphasized that planners should never use an A.I-generated contract clause without running it past an attorney who is knowledgeable about meeting and event contracts.

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