by Amita Patel, Area Director of Sales and Marketing, Kahler Hospitality Group
The keys to convincing management that meetings and events should remain an integral part of any company or organization’s overall strategy are to demonstrate that every possible cost-saving measure is taken into account, and in the end, to demonstrate any proposed event’s ROI (return on investment).
With that backdrop in mind, I have gathered tips from experts, as well as my own insights, for reducing costs in several key areas of meeting and event planning.
Some of the most common areas where meeting planners can save money without cutting quality include the following:
“Location, location, location” is the oft-quoted mantra of the real estate industry. The phrase is generally used to note that the more desirable a location, the more money people are likely willing to pay for it.
This is true in event planning, too. Where you select to host an event can have a huge impact on the cost of holding the event. In big cities, it is not just the basic cost of the venue that is affected, either. Select a destination such as New York City or Las Vegas, and you can expect to pay top-of-the-market rates for hotel rooms, food and beverage, and even the hundreds of small must-have items and services that go into pulling off a high-quality event.
Proximity to airports, number of hotel rooms, and local attractions are all important, of course. But look around, and you may discover you can have access to all those amenities for a fraction of the cost of being in the city center. Larger metropolitan areas frequently have satellite airports and world-class facilities not far from their central locations.
Take the newly expanded Rochester Convention Center, for example. Located less than 90 minutes from Minneapolis, MN and many of the attractions Minnesota has to offer, the 225,000 sq. ft. facility is surrounded by over 2,500 hotel rooms in downtown Rochester.
Non-union venues typically have lower labor costs with fewer minimum requirements but building costs at those facilities may be higher. Conversely union facilities may have lower building costs.
It’s a good idea to know the union rules and policies at every facility you consider and how those rules affect your costs. For example, must exhibitors use union labor to set up their booths? Knowing and communicating those rules to your exhibitors can save them money as well.
Create and manage a budget
It is a business maxim that in order to control costs, you must know what your costs are. Even a small event can be a complex undertaking with lots of expense items that can quickly get out of hand if you don’t have a plan for dealing with them up front. Identifying costs long before you’re actually onsite can go a long way toward ensuring everything is covered before it becomes a last-minute, “I gotta have it at any cost” budget-buster. The larger the event, the more important it is to have a detailed budget. There are always those last-minute, unexpected items, and every budget needs some flexibility to deal with them. It is a good idea to have a small percentage built in to handle any unforeseen contingencies, especially with large, difficult-to-quantify costs.
A great way to save on basic facility costs is to be flexible about the dates for your event. Date flexibility can score major savings.
Most meeting and convention facilities charge by the hour, so set an agenda, and stick to it; getting in and out on time and planning a tight schedule of events with no more unused time blocks than necessary can save money. Carefully defined operating hours will also save you money.
Ask for help creating an event to fit your budget. You would be surprised how creative and accommodating a venue will be if you provide a realistic budget up front. But understand that every venue has a bottom-line operating costs that must be covered.
(Almost) Everything is negotiable
Negotiating with hotels is never easy, but today there are opportunities to leverage everything a meeting planner has to offer, writes Rob Hard, event planning guide at About.com4. Hard advocates doing your homework, know what the rates are at competing hotels before you start negotiating, he suggests. The number of rooms and nights your group will require can be leveraged for discounts.
Though guestrooms offer a greater profit margin than any other event service, it is wise to know the overall value of your business to leverage the negotiation process.
Another strong negotiating tool is to provide the group history of the last couple of years for the event outlining group room pick up vs. contracted block; food & beverage expenditure and room rental. All of this information is leverage for negotiating.
Let these tips sink in and come back for Part 2 next week. If you are looking for more information now, check out Midwest Meetings Checklists and Forms.