Contracts; Association Meetings
April 2, 2012
Last week I had the pleasure of speaking to the Illinois chapter of Association Executives on contract negotiation for association meetings and events. I flew into St. Louis, MO and drove to Springfield, IL amidst endless farmlands. It was a beautiful afternoon and I was reminded of just how diverse this country is. No matter where I am in the world I try to appreciate the beauty of the landscape. No two are alike.
Speaking about contracts can leave one crossed eyed at best; it’s not the most riveting topic. But, based on the attendance, it seemed to be of interest to many. My goal was to have the attendees walk away with at least 1 new tip or a different way of looking at it, which I believe was accomplished.
Some tips to remember might include:
- Each meeting is unique; use templates as a starting point only
- Come to the table prepared with facts, figures, market realities- it will make a big difference
- Be flexible when possible with dates
- Don’t focus on items that are NOT an issue (give and take)
- Address indemnification in two separate clauses (you, supplier)
- Find out who is liable for the contract signature; make sure it isn’t you
- Address the following:
a. Performance damages
e. Published rates
f. Courtesy blocks
g. Guest relocation
Two very big concerns for associations as well as any entity contracting meetings are attrition and cancellation and the potential resulting damages. Both parties of the contract want to reduce risk and increase revenue and while the standard clauses may vary it may be wise to work through specific examples to avoid future interpretation. Sometimes one word can change the entire meaning. Is attrition calculated per day or cumulative? Is F&B minimum per meeting or by number of functions or covers? Are damages calculated on lowest room rate or profit margin? Is cancellation on a sliding scale? Are resell provisions specific enough? These are but a few of the many terms and conditions that need to be addressed and often aren’t satisfactorily. Contracts can be complicated and sometimes it really does pay to know when to ask for help.
As I drove back to St. Louis after the session I realized that the topic wasn’t so dry after all and that many did indeed leave with a new thought or idea AND as a bonus I got to see America’s farmlands! For more information or a copy of our contract check lists, simply send me an email. All the best!