4 Hotel Negotiation Tactics Every Event Planner Should Know

For many event planners, negotiating with venues is just slightly more enjoyable than a root canal.

But to make these events happen especially in a seller’s market negotiation strategies are key to getting the venue and budget you need to pull it off. Hotel negotiations don’t have to be difficult, as long as you know the landscape. Here are four tactics to take to the bargaining table that will help you negotiate a killer deal.

 1. Understand your meeting value

Sounds obvious, right? You’d be surprised at how many planners go into negotiating hotel rate without knowing what value their meeting will bring to the venue.

Hotels base meeting value on a specific set of criteria. Focus on these key value generators, and your bargaining power grows:

• Booking window (are you booking next week or next year?)
  Power= Meetings within six months
• Flexibility on your dates
  Power=Ask the hotel event coordinator to offer their best date
• Catering spend
  Power=Ask what the hotel’s F&B minimum is over your dates. If you’ll spend more, then you have the power.
• Space-to-rooms ratio (how much meeting space you need for each guest room you’re blocking)
  Power=Learn to calculate your SRR (see below). Then ask what the hotel’s SRR is over your dates. If you’re requirements are less, then you have the power. 

2. Flexibility

Sure, your dates aren’t flexible. But do you know what you’re missing by saying you’re not flexible? You’ll NEVER negotiate hotel prices successfully if you continue to tell venues: “My dates are not flexible.”

Here’s why. Hotels are constantly working to complete their “occupancy puzzle.” A minor adjustment to your arrival/departure dates may fit your group perfectly into the hotel’s “puzzle.” The right hotel event coordinator will often incent you by offering special pricing and cost saving concessions in return for your flexibility.

Motivate your venues to offer up an alternative by saying: “Although my dates are firm, I might be willing to explore alternate dates if you make it worth my while to change.”

This sentence can save you some time when you’re having trouble finding availability. It also can open up your options and save money at the same time.

3. Know your history

When you provide hotels with two or more years of history on your meeting, you show it has consistent room pick-up, indicating your group will again meet its room block commitment. You also enable hoteliers to forecast their guest room inventory more accurately, so they have a better chance of selling out the hotel.

You can build meeting credibility by sharing key information such as: Does your group historically come within 5% of meeting its room block? Do you exceed the food and beverage minimum? Does your organization make use of the full range of hotel services? Do you book your meeting or event 30-90 days out, enabling the hotel to release available rooms and sell them for more than the group rate you secured? These factors all add to your meeting value and will benefit you when you’re later negotiating hotel prices. Also focus on what you’ll do to drive attendance (key marketing tactics, size of your target audience, big-name speakers you’ve confirmed for the event, etc.).

The best time to share your meeting history is right at the start, when you send your meeting request. Hotels receive scores of RFPs daily. One of the biggest ways to make your hotel event management stand out is to show your meeting is a great fit, having taken place successfully at similar hotels in the past.

No history? No problem. For first-time meetings, the key is still to make hotels understand why your meeting should be taken seriously. Is the meeting mandatory? Do you have history from other meetings that are similar? Share this info with the sales manager. You can also provide history on other meetings you’ve held with similar size, rates and target attendees to show you’ve driven results at comparable hotels in the past.

4. Less is More: Leverage space-to-rooms ratios

For successful negotiations, one value generator is sorely overlooked and it happens to be key to driving a fantastic deal: the space-to-rooms ratio (SRR).

Hotels don’t want to be left with a lot of available guest rooms and no meeting space to offer. Knowing how your group affects their meeting space inventory and how you can help them free up space will make hotel event management work hard for your business.

Your goal comes down to a simple equation: SRR down=Concessions up. Learn a few basics and use SRR to maximize savings:

Know all the SRRs
Every hotel has its own SRRs. Ask for each property’s ratio up front to better understand their expectations. To find your own group’s SRR, dig into your meeting history to determine how many meeting room seats and guest rooms your group will need each day. Here’s the calculation:

SRR=# of seats x 20 sq ft divided by your room block that night

If you’re below the hotel’s ratio, you have more bargaining power! If you’re over, work with your hotel partner to help them free up some space.

Lower your SRR in ways that will have little-to-no impact on your meeting.
Set up your meeting room on the first main day attendees arrive. If you set up before your room block starts, you’ll dramatically reduce your chance of finding availability, let along scoring a great deal. Reuse your main meeting room for breakout sessions and dinners to further cut space needs. On the last day of your meeting when everyone checks out, your meeting space needs are high but guest room need is minimal-to-none. Ask the hotel event planner about holding breakouts in another space. A restaurant, suites or patio could be a nice change of pace for a last half-day of meetings.

Pick room setups that improve the ratio.
For example, banquet-style tables accommodate more people than a hollow-square setup. Use a setup that drives your SRR down. Then work with the sales manager to return the favor with additional concessions.

Meeting costs may be rising, but you’re building credibility and driving value for your hotel event coordinator or hotel partner. Use your leverage to gain valuable concessions, and you’re well on your way to mastering the art of negotiations.

Updated in 2018 for relevance.