The Golden Rules Of Negotiating With A Hotel

the golden rulesBeing a skilled negotiator is critical to your success as a planner. And yet so many planners have poor negotiating skills that lead to higher expenses for the organizations they represent.

In many cases, the person responsible for negotiating a deal simply accepts all conditions from the hotel at face value without asking for a single concession.

So how can you get better at negotiating with a hotel?

While there is no magic bullet to get better at negotiating with a hotel, following the rules below will give you more confidence at the table.

Rule #1: Don’t Negotiate Group Hotel Rates

One of the biggest mistakes we see planners make is that they try to negotiate with hotels individually. The problem is that trying to get group rates from a dozen hotels can take weeks by phone. Most meeting or group planners end up negotiating with just one or two hotels (usually the ones that responded first), and call it a day. The problem with this method is that it is time consuming and yields minimal savings.

Instead, why not try a system that

  1. Yields group hotel rates with an average savings of 22%?
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  3. Lets you negotiate with dozens of hotels online
  4. And is completely free, with no obligations

Just take five minutes to fill out our group hotel rates request form. As soon as you submit yours groups details, dozens of hotels in your desired city and price range will respond (i.e. compete) with detailed group rates.

Try it out and you will never go back to calling hotels individually.

Rule #2: Don’t Answer This Question

“What is your budget?” is a question that hotel sales managers are trained to ask to find out how much you are willing to spend. Often, the number you give as your “budget” ends up becoming the starting point of negotiations, leaving you at a severe disadvantage.

When asked this question, answer with “We are still developing a budget so I can’t answer that right now”. Doing this will deflect the question without offending the other party.

Rule #3: Use Trade-Offs

Don’t concede anything, even non-monetary items at any point in the negotiations. For example, a hotel sales manager may say “Our standard cut-off date is 30 days after which we will not hold the rooms”. While this may be the way the hotel does business, insist by saying “Let’s talk about the cut-off date later”.

Why is this important?

Because as you proceed through the negotiations, you can use the cut-off date as leverage. For example, if you come to a standstill on the number of complimentary rooms being offered to a wedding group, then you can say “I was looking for a cut off date of one week but I will agree to the four week cut-off if you agree to make the comp ratio 1:20 instead of 1:30”.

Even something as small as the cut-off date is negotiable. The golden rule is to never concede anything without getting something in return.

Rule #4: Don’t Bother With Ultimatums

Ultimatums rarely work when you are negotiating with a hotel. Despite that, many people still try it to see how far they can push the other side. Doing so puts the hotel sales manager into a corner, forcing them to make a decision quickly. And that decision most often will not be favorable for the person giving the ultimatum.

Why? Because people inherently do not like their choices limited. Add overly aggressive negotiating tactics and it becomes much easier for the sales department to just say no.

Instead, try taking your time with the sales manager and understand their needs as a business. The more time the manager has vested in the deal, the more concessions they are likely to give in to.

Rule #5: Look At The Total Spend

When negotiating on behalf of your group, don’t forget the ancillary expenses that the hotel will benefit from. Your guests will spend additional monies at the bar, gift shops, parking, meeting rooms, etc. Using the total anticipated spend as your bargaining chip instead of just the rooms portion will give you more leverage.

Rule #6: Don’t Accept First Offers

When negotiating with a hotel, the sales manager may say “Our hospitality suite is $400 per day for a class reunion of your size”. This statement is not a matter of fact so don’t take it at face value. The manager is just looking to see if you will agree to the price. Your response to any first offer should be “Can’t you do better than that. Most of the other hotels we went to offered the hospitality suite for our class reunion for free”.

First offers should simply be treated as a starting point of negotiations, not a point of fact. Never accept a first offer from a hotel.

Rule #7: Everything is Negotiable

Even if the sales manager says that something is non-negotiable, it is. Oftentimes it is just a matter of knowing what the hotel needs are.

For example, a hotel we recently booked for our annual convention would not budge on the meeting room fee despite our best efforts. After researching a bit, we found out that there was a large piece of business that was looking for similar dates as ours and so the hotel was less inclined to give anything away.

Knowing this, we went back to the hotel and asked for their need dates and booked a week that wasn’t as busy. Our negotiations from that point on were much smoother as the hotel was willing to concede on many previously “non-negotiable” items.

Rule #8: Promises Are Not Contracted

When negotiating, a sales manager may make certain promises that are not in the contract. Inevitably, the service that was promised is not delivered and you are left holding the bag. As a general rule, if the hotel promises anything, have it put in the contract. Doing so will help you avoid a clash with the hotel staff during your event. Written agreements also come in handy when one of the negotiating parties switched jobs before the event is commenced.

Rule #9: Time Is Your Best Friend

Don’t rush through any kind of negotiation. Take your time to understand every aspect of the deal, read through the contract, and ask as many questions as it takes. The benefit of time is that it makes the other side more vested in getting the deal done. The more time you spend at the hotel, the better a deal you will end up with.

Rule #10: Walk Away

This one is simple. There are dozens of hotels in most cities and while your heart may be set on one, it is best to sometimes walk away. Leave the negotiating table, and start talking to other hotels. If anything, you may be surprised at how accommodating the other hotel may be to your needs.

If the hotel you walked away from is truly interested in doing business with you, they will call you back.

The rules above will help you become a more effective negotiator on behalf of your organization or company. It will lead to lower group hotel rates and better amenities for your guests.

What should you do next?

Read about the secret to getting the lowest group hotel rates (without negotiating too!)

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