Transcript Document

Chapter 9
Negotiations and Contracts
Convention Management and Service
Seventh Edition
(478CSB)
© 2006, Educational Institute
Competencies for
Negotiations and Contracts
1. Describe how hospitality salespeople prepare to
negotiate with meeting planners.
2. Identify the elements of a letter of agreement, or
contract, for meeting and convention sales.
3. Explain the effect of contract standardization and
multiple-meeting contracts on the meetings and
convention industry.
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1
Negotiations—Purpose and
Preparation
Purpose
• Two or more parties try to reach an
agreement for mutual benefit
• Create a win-win situation
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(continued)
2
Negotiations—Purpose and
Preparation
(continued)
Preparation—Gather information in these areas:
• Product—property fact book; peaks, valleys,
and shoulders
• Competition—strengths and weaknesses
compared with your property’s
• Prospect—budget; purpose for meeting;
dates; hot buttons; past problems
Tools
• Inquiry questionnaires (obey antitrust laws)
• Proposal letters
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Elements of a Contract or Letter
of Agreement
1.
2.
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4.
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9.
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Names of organization and hotel
Official dates
Number and kinds of rooms
Rates
Arrival pattern
Public space
Complimentary and reduced-rate rooms
Prior visits
Working space
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Elements of a Contract or Letter
of Agreement
(continued)
10. Registration control
11. Exhibit space
12. Food functions
13. Refreshment breaks
14. Liquor
15. Audiovisual equipment
16. Union regulations
17. Master account and credit procedures
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Elements of a Contract or Letter
of Agreement (continued)
18. Method of payment
19. Termination/cancellation clauses
20. Damage clause (liquidated or mitigated damages)
21. Gratuities and service charges
22. Attrition clause
23. Arbitration
24. Warranty of authority
25. Insurance/indemnification
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Convention Industry Council (CIC)
Composition
• 29 member organizations
• Half represent sellers, half represent buyers
• Members include AH&LA, IACVB, and MPI
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(continued)
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Convention Industry Council (CIC)
(continued)
Purposes
• Facilitate cooperation between meeting
hosts and meeting planners
• Recommend solutions to industry problems
• Recommend a consistent basis for handling
convention procedures
• Develop programs to serve the industry and
the public
• Create an awareness of the magnitude of
the industry
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Contract Standardization and
Multiple-Meeting Contracts
Contract Standardization
• Already in place for some chains
• Some planners’ objection: meetings are unique
• Also standardized: event résumés, banquet
event orders, billing procedures, and more
Multiple-Meeting Contracts
• Used by both corporations and associations
• Benefits: efficiency in negotiations and
planning, guaranteed business for hotels
• Drawback: lack of flexibility to seek most
profitable market
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