We grilled planners known for being tough negotiators, then got famous dealmakers and international negotiation experts to spill their secrets. What'd we learn? Basically, negotiation is not war, so there's no reason to fear it. It's more like a dance, with both parties bending a bit here, twisting a little there, to accommodate the other. Good negotiators consider the other side's interests (remember the phrase "win-win"?). They listen. And perhaps most importantly, they enjoy it: "Negotiation is the most exciting part of the job for me, because it takes intelligence," declares Dawn Penfold, president of The Meeting Candidate Network, a planner recruitment firm in New York City. Not only that, she adds, it's one of the skill sets firms look for when hiring planners.
So without further ado, here is SM's guide to negotiation. While we can't guarantee you'll love negotiating after reading it, we bet you'll find it more interesting -- and maybe, just maybe, a little more fun.
A Tip from a Pro
Dianna Booher on invisible body language
A communications expert and author of a brand-new software series on negotiation, Booher says appearances count -- even over the telephone: "Research proves that people can hear it in your voice when you're slumping in your chair, or not smiling," she notes. "That's why customer service reps are taught to place calls in front of a mirror." Booher advises planners to sit up straight, smile, and keep a friendly, nonadversarial tone to their voices when talking on the phone -- which, after all, is where most negotiating is done these days.
Contact: (800) 342-6621;
www.dianna-booher.com
Grab a fabulous buffet lunch for peanuts
It's not a matter of tough negotiating tactics, but schmoozing your way to a great deal. "Sit down with the chef," advises Carol Krugman, whose St. Petersburg, Florida, company, Krugman Group International, specializes in international meetings.
Rather than picking out dishes in advance, she explains, tell the chef up front how much you can pay per person and let him or her choose the menu. By doing this for a 70-person meeting at the Hyatt Regency in Santiago, Chile, Krugman ended up with "an extraordinary spread way beyond anything I would have picked" -- including a variety of hot dishes, salads, and desserts -- for only $28 a person, net.
"The hotel wouldn't have done it if it meant losing money, either," she adds. "We let them follow their buying patterns, obtain ingredients in season, and use their resources to the maximum, and as a result, we ended up getting the best deal too."
Slash f&b
If you plan large gatherings that include several meal functions, ask for an across-the-board discount of 10 or 15 percent on food and beverage, offers Wayne Robin-son of New York City-based Guardian Life Insurance. Or negotiate down the minimum: Robinson typically tries to shave 25 to 40 percent off a $200,000 F&B minimum.
In the push-pull of negotiations, "Hotels won't push back on that because they know you'll spend more than that anyway," he says, "and it helps you save on F&B attrition fees -- you're likely to meet a lowered minimum even if you have a lot of no-shows."
A Tip from a Pro
Alan Ovson on riding out a tough negotiation
Founder of San Francisco-based Ovson Communications, Ovson leads workshops in "how to negotiate with anyone." If you start to feel a particular deal's not going well, says the 20-year communications veteran, "Stop, take a deep breath, and say something like, 'This particular issue is difficult for me. Can we move on to another point and come back to this later?' "
Ovson knows -- and so should you -- when to walk away: "In my real-estate days, I was once negotiating a land deal with a person I found vicious and totally repulsive." How did Ovson handle working with someone he despised? He didn't -- he bowed out and hired a professional negotiator instead.
(415) 392-2333; www.ovson.com
Stamp out surcharges
Several planners we interviewed said they routinely add clauses to hotel contracts stating they won't be responsible for any additional fees imposed post-signing (a lesson from the energy wars). But if you're not extra-vigilant, attendees might still get stuck paying mandatory fees -- they've been known to show up on the room cards given to attendees at check-in, notes Bill Mattes, manager of meetings for ISO in Jersey City, New Jersey; if attendees see any mention of those pesky $3 surcharges on their room cards, says Mattes, "They should cross it out." Otherwise, he warns, they'll get stuck paying it.
Sometimes invoking your "good customer" status works. The first time she got stuck with an energy surcharge, Carroll Reuben, an independent planner in Rolling Hills Estates, California, appealed directly to the conference hotel in Minneapolis that imposed it. "I said, 'I didn't plan on this in my budget. Can we work something out?'" she remembers. "Because they knew I was bringing my conference back the following year, they agreed to cut the surcharge in half."
Save thousands on hotel attrition and cancellation clauses
How? By negotiating the attrition clause in your hotel contract to specify that you'll pay lost profit on rooms, not revenue. Vicky Betzig, unofficial countess of contracts for meeting management company JRDaggett & Associates in Chicago, explains how it works: Standard room-rate profit is around 75 to 85 percent of revenue (big markup, huh?). When negotiating attrition with the hotel, readily agree to a specific percentage -- whatever the hotel asks for, provided it's within that seventy-five-to-eighty-five-percent range," notes Betzig. "That way, by agreeing to pay one hundred percent of the hotel's lost profit, you're really only paying, say, seventy-five percent of revenue." Do the math: If 100 attendees don't show up the first night on a $200-a-night room block, you're out $20,000 if you agreed to pay lost revenue. But if you'd agreed to pay lost profit, even at a generous 80 percent of revenue, you'd pay only $16,000.
Hotels will often forgive cancellation fees if you agree to redirect future meetings to that property or others within the chain, notes Gilda Caputo, a planner for PricewaterhouseCoopers in Florham Park, New Jersey. She adds that this strategy is especially useful when your meetings department is consolidated, as hers is, and therefore has increased purchasing power.
When negotiating cancellation clauses, try asking if the hotel will let you pay room and tax on just the peak night of your canceled meeting, suggests Mollie Wallace, president of Planning Professionals Inc., in McKinney, Texas, who did just that for a five-day, 150-person Sun Microsystems conference that ended up being called off a month out. Under the cancellation clause originally proposed, Sun would have paid a percentage of both total room-nights and F&B -- a whopping $100,000, Wallace notes; under her negotiated version, Sun ended up paying only $32,000.
Pay today's room rates for a meeting a few years down the road
Agree to book the meeting during a reeeally slow time -- like Easter weekend. That's how Bill Mattes ended up locking in 1999's room rates for his 2003 association meeting.
"There was a lot of back and forth," he admits, "and we helped fill the hotel's needs by basically agreeing to give them a major piece of business over a holiday weekend. Not only did they guarantee the current room rate, but they threw in numerous upgrades, and even gave us $25,000 toward the cost of our reception!"
A Tip From A Pro
Erica McKeon on cultural issues: As vice president f New York City-based Bruce Levy Associates, which represents some on the biggest names in women's basetball, McKeon often places players on overseas tems. She says being familiar with cultural differences, even within regions that we tend to lump together, is key: "There are certain issues you can push with a Korean team but not a Japanese one, just as there are things an Italian team will accept that a French one won't."
Put some fore in yout force majeure clause
Mollie Wallace found herself suddenly calling off an October meeting in New York City because of terrorist attacks the prior month. By invoking the force majeure clause in her contract, she didn't pay any cancellation fees. You should be covered if you do as Wallace did: "Go over the wording of the clause beforehand," she warns. "If you don't specify that it includes terrorism along with hurricanes, earthquakes, and so forth, the hotel can refuse."
How could Wallace have known, months before the September 11 tragedy, to add "terrorism" to her force majeure clause? She used to be in the Air Force, where she was involved with Desert Storm.
Save a couple thou on your site inspection
Last month, Mollie Wallace had to take a quick weekend jaunt to Germany to inspect some meeting properties. By explaining -- and furnishing proof -- that she had to go for a site inspection (betch didn't know airlines have a site inspection rate!), she managed to get a round-trip ticket worth $2,000 for only $250.
Hotels have site inspection rates as well, adds Wallace. "If the hotel is good and wants the business, they'll comp you the first night and give you a site inspection rate for the second night," she notes.
Put your CEO in the presidential suite -- for a teensy price
Doing a meeting that's taking over the entire hotel? Ask -- nicely -- if you can have the presidential suite for your most important VIP for the price of a standard room, suggests Carroll Reuben, who speaks professionally on hotel contract negotiations. The hotel doesn't lose any money by cutting you this deal, she points out -- after all, the chances some bigwig will wander in asking for the presidential suite are practically nil when your group has filled every other room in the property.
Even if you haven't packed the place, you can still get a great deal on the hotel's best room, says Carol Krugman, who managed to get her top client at a high-level international business meeting installed in the famed Ottoman Suite of the Hyatt Regency in Istanbul. "He mentioned to me, half-jokingly, that he wanted it," he recalls, "so I asked the hotel if it was occupied. When I found out it wasn't, I said, 'Would you mind putting our top-ranking person in there, provided you're not losing revenue as a result?' "
The hotel was happy to do so because of the goodwill it created, she notes. "And will I go back to that hotel? You bet I will!"
A Tip From A Pro
Roger Fisher on listening to the other side: Coathor of the classic negotiation tome, Getting to Yes, Fisher is director of the Harvard Negotiation Project as Harvard Law School. No matter who you're dealing with, he says, you won't get very far without considering their interests: "When I was helping get the hostages out of Iran in 1980, I asked the Iranians what they wanted. America had never recognized their revolution and was insisting the financial claims be settled in U.S. courts. We worked out a scheme in which, among a number of points, the U.S. recognized the Iranian government and financial claims would be arbitrated in the Hauge."
Contact: (617) 495-1684; www.pon.harvard.edu/newpon/