Modern event contract negotiations require a modern mindset, with necessary clauses and the right wording to ensure that every circumstance is covered. Event planners need to be aware that hotels and other venues are not following the same set of rules that they were during the pandemic, and that the current event landscape is roaring back to life. Let’s take a closer look at what this shift means to you as a negotiator, and some tips to beef up your contract.
Gone are the days of hotel venue contract flexibility. The pandemic created a situation where hotels were willing to be more accommodating to meet their own bottom lines with new business. However, that is not the case anymore, and hotels are beginning to negotiate without concessions again. Competition is stiff and rates can be high because these event locations are in more demand than ever before. This is especially true when comparing 2020 and 2021.
In 2020, hotels were happy to make accommodations because the industry was struggling. Now, there are more events than ever before as companies and other organizations make up for the lost time.
This is why it is important to carefully negotiate your contract, and ensure that no stone is left unturned. Go into the negotiation process with your wits about you or find a professional who is used to the changing marketplace.
In 2022, it is extremely important to ensure that your contracts are safeguarded against bad circumstances and that changes are noted. Ultimately, your company’s interests and event’s success needs to be protected. If you normally do not pour over your contracts, now is the time to start, or, hire someone who knows the ins and outs.
One clause that you might find in most contracts is what is known as a “force majeure clause.” This clause is a provision that essentially frees both parties from the relevant obligations in the event that an extraordinary circumstance prevents the contract from being carried out. While you may think that this would cover you if any COVID-19-related issues come up, this is generally not the case. It is important to specifically ask the venue, but these days, most hotels will not agree to any sort of pandemic-related clauses. This is standard practice now to protect the venue’s financial interests, and event planners should always take that into consideration.
Despite the fact that in-person events are seemingly back in full force, it is still important to think about long-term protection. In addition, keep in mind that some event attendees may suffer from travel anxiety after several years of not going to in-person conferences or gatherings.
It might be true that travel restrictions in most American states are less stringent than they once were, but circumstances can change quickly. This should be reflected in the contract with the venue, especially a hotel venue. Take into consideration every possible situation, and ensure that there are clauses that protect your interests in the long run.
Here are two examples that can shelter your event:
As always, you want to get the best value for your investment. This is true through securing the best rate for the event space and ensuring you get the best price if you are booking rooms for the meeting. If the venue or hotel is not willing to budge on their room rates, don’t be frustrated; it takes a savvy negotiator to secure the best rate.
Think outside the box and ask for other concessions such as room upgrades, transfers and other amenities. Your guests will appreciate something like valet parking and can also elevate your event, even if you are not getting your preferred rate.
What To Know About Attrition
Keep a stern eye out for the attrition clause. This is the percentage of a room block that the hotel requires your event to fill by a predetermined cutoff date. Most of the time, the cutoff date is 30 days out from the event date. If you fail to fill the slots, you may face an attrition penalty. Normally, the attrition penalty is the difference between the booked rooms and the attrition limit. However, your contract can include clauses that protect you from these kinds of fees.
For example, you can negotiate that all booked rooms are counted toward the room block. To be fair to the hotel and the event planner, you can create a clause with a sliding scale to figure out how much the hotel should be compensated for rooms they can’t resell. The event planner should also negotiate for flexibility in applying the cancellation fees. This ties into the more prominent travel anxiety, as some people may cancel their trip. Ensure that hotels are not charging full cancellation penalties.
To learn more about negotiating the best contract for your event or to hire a professional event planner,