Group Hotel Negotiations

In the current uncertain economy, the hotel has undergone some of the leanest years, and thus has far more adaptable to the needs and requirements of groups than before. They have offered additional concessions, reducing their profit margins in the areas most suited to their hotel and their specific conditions of the market. Competent negotiators have been able to secure better than the typical agreement with the hotel during this period for that reason. Fourth quarter of 2010 showed a bit of an improvement for many hotels and hotel chains, with both groups and hotel occupancy rates are higher. While one quarter does not make a trend, and while rising from a low number is still in most cases below the normal average, most chains started to reexamine the policy of their group, and determine the concessions may no longer be required. Clearly, from the perspective of the hotel, fewer concessions they need to provide for the guarantee and securing business, the more beneficial it is for them.
Because there are only a quarter of pretty much across the board improvement in hotel financial picture and, although most of the major chains projecting an overall improvement and progress of a proceed in the late 2011 or early 2012, there is still little known. Indeed, most hotels are still nervous about how the economic conditions, energy prices, etc., will affect them. They are still worried about high unemployment rate, as well
as the cost of doing business. They still have not, in many cases, actually witnessed the return continually to the occupancy rate a few years ago. While some hotels may start to take a firm negotiating stance, most prefer to have a "bird in hand," than to lose potential revenue. This means that the top-level negotiators will still be able to effectively get concessions from the hotel, despite the mediocre or average may have a much more difficult. Better negotiators know what hotels want and expect, and understand the need to work with the hotel as "partners," while still getting the most value to the organization or group represented.
As someone with more than three decades of experience negotiating hotel and expertise, has been negotiating effectively for groups of forty to several thousand, I have urged the organization to "take advantage" of the next few months to negotiate as far in advance as they can afford, because negotiating position may be better than it will be next year. Obviously, no one has a crystal ball, but if all the projections, and internal policy discussions hotel is true, chances are that most properties will take a much harder stance on concessions, etc., than they will now.