3 Things to Keep in Mind When Negotiating Your Next Contract
Negotiating contracts comes pretty close to the top of our list of “most favorite event activities.” You shouldn’t be surprised by that – we’ve talked about how much we love contracts before (here and here). It’s not one of the most glamorous or high-profile tasks when it comes to event management, but it is one of the most important. Much attention is paid to the financial elements of the deal (which are incredibly important), but there are many other contract clauses that can make (or break) the overall success of your event and deserve equal time in your contract review process.
Imagine your upcoming event for just a moment. You are releasing your product roadmap for the upcoming year to your sales force and training them on how to sell what will be ground-breaking new product in your industry. The event goes off flawlessly and evaluations indicate that the training knowledge is being retained. You are sitting in your office a few weeks later when a news article catches your eye – a competitor has just announced a new product that will render yours (which hasn’t even been released yet) obsolete.
It’s entirely possible that your competitor was having a meeting in the room next to yours at the hotel and now has your confidential product roadmap for the coming year.
Corporate espionage is, unfortunately, nothing new and there may not be a fool-proof way to prevent an unauthorized person from getting into your sessions, but you can mitigate the risk with a simple contract clause that prevents the hotel from booking competitor events over the same dates as your meeting. Typically, you will be asked to actually name the competitors that are blocked from booking rather than using a vague category like “healthcare firms” or “technology companies.” If the hotel already has a booking from one of the named competitors, they likely will not cancel it so you will need to make a decision about whether to move forward with your event at the property with the competitor down the hall from your group.
Right to Audit
The last surprise you need when planning your event is finding out that you may be in an attrition situation with rooms, but yet your event is sold out or close to being sold out. This can happen when you have attendees who book rooms late or book rooms outside of your contracted room block. Protect yourself in the contract and ensure that you receive full credit for these rooms by including language that gives you the right to audit your full attendee list against the hotel’s guest list. This does bring up some privacy and confidentiality concerns, so you will need to work closely with the hotel to craft the specific language that will be acceptable to both of you.
Sometimes the only way to really learn something is to experience it. Many years ago, we were just about to sign a contract and were reviewing the room night matrix one final time to ensure that all of our updated counts were reflected. The number of rooms per night was correct. The days of the week in the header was correct. The actual dates listed in the header were wrong. We assumed this was just a small oversight, marked the changes to the dates (which now matched the days of the week) and returned the contract. Problem was that the hotel didn’t actually have the rooms we needed on the correct dates and we had to start the search all over again. Compared to the other possible outcome (we had signed the contract and discovered the error months later when we turned in our rooming list), starting the search over was definitely a better outcome. Before signing any contract, make sure that every letter, every word, every number is 100% accurate. Don’t assume anything.
Beyond the financial commitments in venue contracts, what are your hot-button issues?