Should You Use Multiyear Agreements for Your Meetings?
Signing on for several years with the same venue or venue group can streamline the negotiation process and give you peace of mind, but it also means more commitment. Before signing a multiyear agreement, take a look at the pros and cons.
Signing a multiyear contract with a venue or venue group can make meeting planners’ lives just that much easier. It streamlines negotiations year over year, it holds the possibility of discounts and other perks, and it allows a planner to build a relationship with the venue.
But as the past few years have shown, meeting contracts can be tricky to navigate if something goes wrong. The pandemic put event planners in a position where they couldn’t host gatherings they’d already signed off on, possibly changing the way meeting planners evaluate contracts for the foreseeable future.
So what’s the right choice for your association? Before deciding on a multiyear agreement, take a look at its pros, cons, and implications.
It Makes Your Job Easier
Contract negotiations, communicating with vendors and suppliers, going through the RFP process. Who wants to tackle these tasks every year?
“Contract negotiations are, without a doubt, among the most dreaded tasks for event planners,” wrote InEvent’s Gabriel Marin on the company’s blog. “Given the legalities associated with contracts, it can seem daunting to negotiate certain aspects.”
But you don’t have to start from scratch. A multiyear agreement means you’re not facing that daunting task every 12 months, giving you the peace of mind that things are already in place for next year.
You Know What to Expect
When you’re already familiar with the venue, know the on-the-ground staff, and understand exactly what you need, chances are your meetings will go more smoothly than they would in a brand-new environment.
The benefit of familiarity is that you can fine-tune the details to improve the event experience year after year. Did you book more meeting rooms than you needed? Paid for more Wi-Fi than you needed? Did attendees say they wish they had access to the lounge or the rooftop bar? When you understand what your attendees want and what you need, you can iron out concessions and amenities. Plus, with a multiyear agreement, you’re showing trust in your partners, which will make for better business relationships.
If you sign a multiyear agreement with a venue group but not one specific location, some of these preferences can carry over from year to year, even if you don’t reap the benefits of seeing the same faces.
Multiyear meeting agreements are also cost-effective. You’ll save money, which you can spend on services to make your events even better. Plus, locking in on a set amount will protect you from price increases.
“A three-year contract can mean a 10 percent savings,” said John Berglund, CEO of Mira Smart Conferencing, in an interview with Smart Meetings.
Lack of Flexibility
Of course, with a multiyear agreement, you’re locked in for a while, which means you could be under contract when unforeseen events (i.e., COVID-19) derail your plans.
However, you can prepare yourself to help mitigate the potential impact of delays and cancellations. Among the tools at your disposal: the force majeure clause, which is a contract provision that excuses parties from fulfilling their contractual obligations when fulfilling those obligations becomes impractical or impossible. “A force majeure clause that is not informed by thoughtful consideration of general or particular risks and their effects on the parties can lead to unfortunate results because a court will construe the clause as if it represents an allocation of risk that the parties bargained for,” the American Bar Association wrote.
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