NEGOTIATING CITYWIDE CONTRACTS

Meetings & Conventions: Planner's Portfolio February 2001
February 2001 PLANNER'S PORTFOLIO:

The Law & the Planner

By Jonathan T. Howe, Esq.


NEGOTIATING CITYWIDE CONTRACTS

When an event has a host of suppliers, it’s crucial to make sure all deals are in sync

It’s one thing to plan an event that takes over a whole hotel, and another when the group needs to take over an entire city. Citywides involve myriad agreements with caterers, transportation providers, destination management companies and a convention center, not to mention a lot of hotels. For planners, coordinating the details is crucial.

MATCH GAME
The single most important rule is to make sure all contracts track together. When you are dealing with issues like cancellation and attrition, each contract must give you an out should conditions change, and these clauses should be as similar as possible from contract to contract.

This means providing for all contingencies that might make your program impossible to complete.

Contingency plans. For example, one of our clients runs a major citywide convention. The organization requires a substantial number of first-class rooms within walking distance of the convention center. To ensure this, each contract has a specific provision stating that, in the event a given number of first-class rooms is not available, the organization can cancel the contract without penalty, and any advances will be refunded. The same applies if the space at the convention center becomes unavailable.

Contracts with such providers as destination management and transportation companies should have similar provisions. It’s like a game of dominoes; if one falls, all the rest must fall in order.

Room blocks. The program cited above is held in the winter, so a provision is added to cover the vagaries of weather that might keep people at home. This provision triggers a reduction in room-night obligations, relative to potential attrition charges. If attendees can’t get to the convention, the host organization isn’t adversely affected.

SIGNIFICANT OTHERS
Planners of citywide conventions contract with a number of third-party suppliers, raising some new issues.

Housing. The availability of a housing bureau in your chosen location becomes extremely important when planning citywides. Make sure you understand how the bureau charges for its services. Will the fee come from the hotel? Will the organization be charged directly? This should be discussed and negotiated at the outset.

Ground transportation. When you use more than one hotel, you are likely to need buses to transport people to and from various activities. Often, planners try to pass this expense on to the hotels, who then recoup the money through the room rate. This is generally negotiated up front with the hotel and with the participation of the convention and visitor bureau. Planners might be able to negotiate concessions from the hotels and/or the city in exchange for placing such a large piece of business.

KEEP TALKING
Often, before the program gets under way, a planner becomes aware that a potential problem could affect the citywide agreements. In such circumstances, the key element is good communication, which can be dictated in the contract with a clause that calls for periodic review of the status of the event. I urge planners to enlist the aid of the convention and visitors bureau for this. While the CVB should not do your negotiating, it can facilitate communications between all contracted parties.

Also, in hotel contracts, state that you will be given credit for everyone who is registered for your event, regardless of how the reservation is made. Otherwise, you might not get some of the complimentary rooms you have earned, and attrition conditions might kick in.