2. TODAY’S
OVERVIEW
AGENDA OUTLINE
7:30AM BREAKFAST/ REGISTRATION
8:30AM WORKSHOPS BEGIN
10:00-10:15AM COFFEE BREAK
•CONTRACT LANGUAGE FOR
•INFORMATION PROTECTION
•LIABILITY (CANCELLATION, ATTRITION
& RESELL)
•INDEMNIFICATION
•HOTEL RATE STRUCTURES FOR 2012, 2013
& BEYOND
•PERCEPTION AROUND F&B COSTS
•INTERNET BANDWIDTH CAPABILITIES
•GLOBAL REACH OF BUSINESS (USING US
STANDARD CONTRACTS)
•TIME PERMITTING: BEST PRACTICES
NEGOTIATING CONVENTION CONTRACTS;
BEST PRACTICES MANAGING PRODUCTION
AGENCIES AND EVENT AGENCIES
11:30AM Q&A/ WORKSHOP ENDS
12:00PM LUNCH
OPTIONAL SITE INSPECTION OF HOTEL
3. • Nearest Restroom/
Nearest Exit
• All interested in site, see
Cindy after lunch
House Keeping:
“Successful people ask better questions, and as a result, they get better answers.”
Tony Robbins
• Discussion format
presentation; will not follow
the slides exactly
5. THIS WORKSHOP MATERIAL IS BASED ON ACTUAL
EXPERIENCES, BUT THE MATERIAL MAY NOT BE APPROPRIATE
FOR ALL PROGRAMS AND HOTELS. THIS WORKSHOP SHOULD
BE APPROACHED WITH AN OPEN MIND AND A HEALTHY
COMBINATION OF COMPROMISE AND EXPERIMENTATION.
DISCLAIMER:
WORKSHOP MATERIAL IS BASED ON ACTUAL EXPERIENCES, BUT THE
MATERIAL MAY NOT BE APPROPRIATE FOR ALL PROGRAMS AND
HOTELS. THIS WORKSHOP SHOULD BE APPROACHED WITH AN OPEN
MIND AND A HEALTHY COMBINATION OF COMPROMISE AND
EXPERIMENTATION.
DISCLAIMER:
PLEASE READ THE FOLLOWING DISCLOSURE
CAREFULLY
!
6. “IF BOTH PARTIES ARE A LITTLE UNHAPPY,
YOU’VE REACHED THE RIGHT AGREEMENT.”
HEATHER’S HUSBAND
8. • TRANSPARENCY AND DOLLARVALUE IN CONTRACT
What hotels are seeing:
•ORGANIZATIONS REQUIRING SPECIFIC LANGUAGE/ PRE
FORMATTED ADDENDUMS
•CONTRADICTINGTERMS IN CONTRACTSVS.ADDENDUM
• HOTELS PREFER ORGANIZATIONS SPECIFICTERMS
TO BE SENT WITH INITIAL RFP
General Trends:
GOING INTO A
CONTRACT IS A
SHARED RISK
• MUTUAL CANCELLATION
• LANGUAGE TO COVER BOTH PARTIES
9. • PROCUREMENT DEPARTMENTS REQUESTING STANDARD
LANGUAGE
• NEED CONTRACTS IN TRACKED CHANGES
Contracts General:General Trends Cont.
10. • ACTUAL DETAILED CALCULATION IN CONTRACT
•CUMULATIVEVS. PER NIGHT
• DAMAGES REVENUEVS. LOST PROFIT
Attrition Liability:
• CUT OFF DATE PLAYS A FACTOR
• RESPONSIBILITY OF APPROPRIATELY
• GROUPS ASKING FOR NO ATTRITION
• ROOM BLOCK REVIEW DATES OR FLAT ATTRITION PERCENTAGE
• NEED MINIMUM COMMITMENTTO HAVE AN ENFORCEABLE
ABLE CONTRACT
• HOTEL CANTECHNICALLY BOOK INTO GROUP’S SPACE
11. • LIQUIDATED: PRE DETERMINED MUTUALLY AGREED
UPON DOLLAR AMOUNT (IE: SLIDING SCALE)
KNOW WHAT
WORKS BEST
FOR YOUR
ORGANIZATION
Liquidated vs. Mitigated
“For example, if a meeting planner cancels a meeting, what is the actual
economic impact on a hotel? This can get complicated Essentially, neither
party knows the economic consequences of a breach until that breach has
occurred. This is why liquidated damages clauses are so popular in
meetings industry contracts.” Smart Meetings Mag.
• THIS METHOD AVOIDS LITIGATION
•DOLLAR AMOUNT NEGOTIATED BEFORE CONTRACT IS SIGNED
• CANNOT BE USED WITH A RESELL CLAUSE
Cancellation Liability:
12. • MITIGATED:ACTUAL LOSS DAMAGES TO THE HOTEL
Liability:
Liquidated vs. Mitigated continued...
• DAMAGES ARE DETERMINED AFTERTHE PROGRAM DATES
• THIS IS WHERE RESELL IS IMPORTANT
Cancellation Liability:
•WHAT ARE REASONABLE EFFORTS FORTHE HOTELTO RESELL?
• UNCERTAIN RISK; CARRYING DEBT
• MORE LIKELY LAWYERS INVOLVED
13. • RESELL: In the case of attrition or cancellation, the Hotel agrees to make reasonable efforts to
re-sell the unused or cancelled space.
• HOTEL CANNOT GIVE BOTH A REBOOK & A RESELL
Liability Cont.
•REBOOKING: When it is agreed that a percentage of the cancellation damages collected are applied to
a future booking.
Liability:
WHEN IS RESALE APPROPRIATE AND WHEN IS
REBOOK APPROPRIATE?
14. Competitors:
• WHAT IS REASONABLE TO ASK THE HOTEL TO CONTROL?
• AREYOU BOOKING 90% OF HOTEL OR 20%?
•INCLUDE LIST OF COMPETITORS IN THE CONTRACT
• SMALL GROUPS REQUEST COMPETITORS NOT ON
SAME FLOORS
15. Each Party (the “Indemnifying Party”) agrees to defend, indemnify and
hold harmless the other (“the Indemnified Party”) from and against all
liabilities, losses,expenses, claims, causes of action and costs, including
reasonable attorneys’ fees, arising out of (i) the Indemnifying Party’s
breach of its obligations under this Agreement; (ii) the negligent acts,
omissions or willful misconduct of the Indemnifying party; and (iii) the
damage, loss or destruction of any tangible personal property or real
property of an Indemnified Party caused by the Indemnifying Party.
INDEMNIFICATION: an an obligation to pay legal fees, judgements or settlements incurred by another party
SAMPLE LANGUAGE:
Indemnification:
• ALSO CALLED HOLD HARMLESS
• INSURANCE
16. Contract Language:
•HOW TO PROTECT CONFIDENTIAL INFORMATION BEING
PRESENTED INYOUR MEETING?
• WHAT IS REASONABLE TO REQUEST OF THE HOTEL?
• PERSONAL GUEST INFORMATION/ ROOMING LIST
• INFORMATION PROTECTION OR
PUBLICITY PROTECTION?
• NO LISTING ON READER BOARD
Information Protection:Information Protection:
•RESERVATIONS CALL-IN
• INFORMATION LEFT IN MEETING SPACE
17. Hotel Rate Structures:
FUTURE RATES: PERCENTAGE ANNUAL INCREASE VS. CONFIRMED RATE
HOW DOES A HOTEL DETERMINE A RATE TO QUOTE:
OCCUPANCY/ WHAT’S ALREADY BOOKED THAT HAVE
ESTABLISHED GROUP RATE/ DEMAND (MOSCONE/
SPECIAL EVENTS- PUT COMPRESSION)
ROOM RATE IS DETERMINED ON AN AVERAGE AFTER CONCESSIONS AND
COMP RATIO
HOW DOES YOUR ORGANIZATION COMMUNICATE DISCOUNTS/ COST SAVINGS
INTERNALLY
Hotel Rate Structure
HOW DOES YOUR ORGANIZATION COMMUNICATE DISCOUNTS/ COST SAVINGS
INTERNALLY
2009/ 2010 IS NOT AN AVERAGE YEAR
18. IN THE LAST YEAR, BANDWIDTH NEEDS HAVE QUADRUPLED-
SMARTPHONE, LAPTOP, IPAD
HOTEL HAS A HARD COST WITH BANDWIDTH AS WELL AS A LABOR COST
REGARDLESS IF THE INTERNET IS OUTSOURCED
FIXED COSTS VS. PER PERSON DAILY COSTS?
CAREFUL NOT TO ASK FOR WAY MORE BANDWIDTH THAN NEEDED-
HOTELS CAN RUN BANDWIDTH USAGE REPORTS POST PROGRAM
Internet Bandwidth:
19. PERCENTAGE OFF FOOD COSTS (NOT LABOR) VS CUSTOMIZED
MENUS
TRANSPORTATION COSTS, ENVIRONMENTAL FACTORS AND MENU
FLEXIBILITY
WHAT DOES 5% OVERSET POLICY REALLY MEAN? UNDERSTAND YOUR
GUARANTEES
SO MUCH EXTRA FOOD THAT IT LOOKS WASTEFUL
Perception Around F&B:
