When I negotiate, I take a legal pad and create three columns labeled "needs," "wants" and "interests."
• In the "needs" column, I list what I absolutely have to have. If these cannot be met, there is no sense wasting more time with the vendor.
• The "wants" column has things for which I have flexibility. I do, however, want these requests to be fulfilled in some way.
• The "interests"column reflects items I would like to have, but do not require. These become my bargaining chips.
The request-for-proposal process is getting increasingly cumbersome. Intended to identify possible vendors for an event, from the hotel to the audiovisual company, an RFP is supposed to spell out details about the program and indicate a desire to enter into a contract if terms and conditions can be worked out. It should answer questions such as: What are the demographics of your group? What is the purpose of the meeting? What are the three top items that you are seeking in a hotel?
Today's RFP has gotten much larger, however, morphing into multiple pages of requests and bogging down the start of the negotiating process. Making matters worse, RFPs are being sent to too many suppliers. Before the Internet, an RFP generally was sent to a handful of potential suppliers. Today, RFPs might go to 50 or 60 hotels, likely consuming many salesperson hours every day (for more on this, see "How Hotels Cope With eRFP Overload").
Boiling It Down
Too many times, requests for proposal are templates that might not even relate to what the meeting is all about.
Going back to a simpler request for information, which would be one or two pages outlining the bare bones of what you are looking for, could save a lot of time by quickly narrowing down which supplier can best meet your needs. It would allow you to sort the wheat from the chaff quickly, allowing you to send the big RFP to the wheat.
The RFP does provide a template for the design of the contract, as all of the areas agreed to in the RFP process should be included in the contract. If an area does not make it into the final agreement, don't assume you'll get it just because it was OK'd in the RFP.
After putting those agreed-upon items in the contract, the next step in bridging the RFP process and the complete agreement is to include the essential contract clauses that protect both sides in the event something goes south before the terms of the contract are fulfilled.
Considerations include ADA requirements, attrition, cancellation, condition of premises, dispute resolution, force majeure, liquor liability, mitigation and notice (see our "10 Essential Contract Clauses for Hotel Contracts"). And, of course, always be sure to identify the proper parties to the contract, which in the case of a hotel is who owns it, not who manages it. Another good paragraph to have is a "quiet enjoyment" clause protecting against disruption that affects the program.
All in all, the RFP process has become somewhat tyrannical, but it can be tamed if it is done with a clear view of the desired outcome.
Jonathan T. Howe, Esq., is a senior partner of the Chicago, St. Louis and Washington, D.C., law firm of Howe & Hutton Ltd., specializing in meetings and hospitality law. Email questions to him at [email protected]