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12 Creative Ways to Cut Hotel Meeting Costs



by Dawn M. Barclay
January 28, 2010

When asked when what travel sellers could do to prove their value to corporations and in doing so, increase their share of the estimated $100 billion-plus meetings and incentive business, corporations, agents and consultants interviewed by Travel Market Report had one overwhelmingly consistent reply: achieve and convey significant cost savings, while of course, maintaining quality.

“The bottom line is money,” said Beth Harin, who works in Marketing Communications at the Movius Interactive Corporation in Johns Creek, GA. Harin said she books two meetings of 100 persons each annually, plus trade shows throughout the year.  “We usually work with the hotels directly. If a travel agent had the pull to secure better discounts and booking incentives than we’d get by calling the hotel direct, we might consider it,” she said.

Vickey Woodley, the manager of meeting services at Medtronic in Jacksonville, FL, admitted that while her company mandates that meeting accommodations  be arranged directly, she sometimes “cheats” and uses an outside company, Experient, to handle the meeting RFPs (requests for proposal) for her annual 300-person sales meeting, citing a strong six-year relationship with the third-party provider.

“They negotiate everything for me, catching things I wouldn’t ordinarily catch. I trust their commitment to me, their consistency, the fact that they’ll always be there when I need them,” she said. However, if the savings were large enough Woodley said she’d be tempted to switch camps. “I can’t imagine it but if [an planner] could save me another $100,000 off a $500,000 already well-negotiated program, I’d consider it,” she said.

So are such savings achievable? And if so, how can it be done?

One way is through strong contract negotiations, according to Shaun N. Balani of Travel Time Travel Agency in Lancaster, PA.

1. Negotiate attrition clauses: “There’s big savings just in the attrition clauses we can negotiate out for them. Sometimes, if they’re a company that does only one meeting a year, they don’t even realize that attrition can be a negotiable item,” Balani said.

2. Watch for Special Deals: Keeping abreast on hotel specials can help in this regard. For example, the Omni Hotel chain (www.omni.com) is offering zero attrition on their meeting packages booked and consumed by December 31, 2010, which means planners won’t be penalized with fees if actual attendance falls below anticipated levels. Some restrictions apply.

3. Ask about alternative dates: Sometimes a slight shift in dates can yield sizeable savings, noted Lou Lemos of BTI The Travel Consultants in Syracuse, NY. “We recently saved one client hundreds of thousands of dollars at a Hyatt in the southeast by convincing them to slightly alter the dates of their meeting to coincide with one of the hotel’s slower periods. We improved the rate by 40% on the rooms alone, not even counting the savings on food, beverage and audio-visual rentals,” he said.

4. Tap into hidden inventory deals: Hotels are often most negotiable on space left empty because of attrition or cancelled programs.

Acclaim Meetings’ AcclaimCite, a robust meetings technology platform, allows members to bid on meeting space cancelled due to attrition or change in plans. AcclaimCite also provides an outlet for their clients if the need arises. (www.acclaimmeetings.com)

MeetingTrader (www.meetingtrader.com), a new online marketplace for the resale of cancelled meeting contracts and reallocation of prepaid hotel credits, is essentially a clearinghouse which CEO Tim Brooks, likens to an eBay for the MICE market. While planners or corporations posting cancelled space will soon have to pay for the privilege to the tune of $1,950 per posting plus a transaction fee equal to 6 percent of the “replacement value,” it costs agents nothing to go onto the site, register, search for remnant hotel space and make an offer.

Planners also can find listings of cancelled space on the MeCo (or Meetings Community) Web site at www.meetingscommunity.com.

5. Find Efficiencies for the Property: Stephen Light, a Connecticut-based independent meeting planner, has also discovered some novel and creative ways to carve out savings for his clients. “Through discussions with a venue, you can request menus that other groups are using and lower costs by piggybacking. This can also be applied to security services by just adding to an existing order from another group,” he said.

6. Think about transportation: Light also said he determines alternatives to costly bus service as a means to transport his groups. “I’m working on a conference in Las Vegas and one client is able to use the underground walkway and free monorail to transport their guests to another hotel’s nightclub,” he said.

7. Be creative: Light sometimes purchases edible centerpieces at meal functions so as to not pay double for an appetizer or dessert and a separate centerpiece. He also takes advantage of the free services offered by state CVBs (convention and visitors bureaus) to do the legwork for hotel availability, after-hours venues and ground transportation. This allows him to use his time more profitably, he said.

8. Drill down on details: Steve Auer, CEO of Wheeling, Illinois-based Cadence, Inc., a 20 year veteran of the live event and meeting production industry, offered several suggestions of where meeting program savings can be achieved. First, he said, “Get accurate. Employ a more detailed registration system and get more detail on meals. Reducing headcount on breakfasts for people who only want coffee, and skipping meals for walk-in attendees translates to big savings. He pointed to one recent 300 person program he did for Pepsi, where by eliminating 50 walk-ins from the local office as breakfast candidate, along with another 30 who opted out of breakfast when asked, he was able to achieve a $3,500 savings for the client.

9. Work directly with a property: Auer also suggested going to properties locally, rather than booking with national sales offices. “Local sales representatives for a hotel or venue will work harder and can provide significant savings over a national rep or broker. They have a pulse on the local market and can offer incentives unique to their property—they wheel and deal just a little bit more,” he said. Price savings for a recent two-night program where the hotel, when called directly, came in $20 per night cheaper than was quoted by the national sales rep. The savings: $16,000.

10. Ask your hotel about airport transfers: “Be creative,” said Auer. “Find something that doesn't really cost the hotel or vendor and leverage it.  For example, airport transfers can sometimes be provided at no charge if a hotel has its own vehicles.  It's a relatively low cost item to the hotel, but can save tens of thousands in transfers or cabs.  In Chicago, Auer found a hotel that was willing to provide roundtrip transfers for his group for $15 roundtrip when local ground transportation firms were charging as much as $60 for the same service.

11. Do your printing on site: Along those same lines, think about asking for free printing from the hotel's business center for agendas, anything you need on site, Auer suggested. He estimated that at $1 per page for a two-page program for 400 attendees, when adding in shipping costs and hotel receiving fees, he saved a client $1,240.

12. Buy in bulk: Auer noted that you can negotiate better rates by planning to be a repeat customer. “It's amazing how simple this concept is, but how seldom it's applied.  Hotels and vendors want repeat business and they're willing to discount to get it.  Use that to your advantage.  Can't sign a three year contract? Don't worry.  Negotiate rebates that kick in retroactively once you reach a certain level.  There's no need for a commitment because if you don't deliver the business, they don't have to deliver the discount,” he said.


Overall the main key to savings is to not be afraid to ask current suppliers to move outside their comfort zone,” Auer said.



Dawn M. Barclay, meetings and incentive travel editor, grew up in the travel business and has worked in many facets of the industry. An award-winning writer, Dawn spent twenty years at Barclay Travel Ltd. and Barclay International Group. She followed this with editor positions at Travel Agent magazine and Travel Life magazine as well as stints at HelmsBriscoe and Carey International Chauffeured Services. She has visited all the continents of the world except Antarctica (it's on her to-do list). dbarclay@travelmarketreport.com
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Contact: 

Dawn M. Barclay
Meetings & Incentive Travel Editor
Phone: 845-893-0173
Email: dbarclay@travelmarketreport.com
http://www.TravelMarketReport.com
 

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Also See: Veteran Meeting Planner Provides Top 10 Tips for Reducing Meetings Costs in 2010 / January 2010
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