Unless or until you are presented with a $30,000 bill from a hotel, most independent meeting planners have never heard of “hotel rooms attrition clauses”.
In all our years of planning meetings for clients all over the world this is perhaps the most misunderstood clause in a hotel contract for room nights, the attrition clause. The results of these clauses can mean the difference between a profitable meeting and one that significantly increases the cost.
Meeting Attrition
When an independent planner books rooms at a hotel, the rate is based on the number of room nights reserved. The more rooms you book, the lower the rate. Rooms are reserved for each night of the meeting, usually starting the day before the meeting starts and ending the evening after the meeting ends.
A professional meeting planner books just enough rooms so that all persons attending the meeting will be able to reserve rooms up to the registration deadline. In less competitive times companies were not penalized for overbooking, as long as the rooms were freed by the company months before the meeting (hence the advance registration deadline).
Today that is no longer the case. At the end of the meeting the hotel will add up the actual total room-nights, and compare this to the “reserved”, if you miscalculate the number of room nights when there is an “attrition clause” then your company is liable for the room nights not used.
How HPN can help
Obviously, a large attrition penalty could significantly affect the profitability of a meeting, and affect future meetings and in some cases cause a meeting planner to lose their job! However HPN works closely with you to prevent attrition fees and there are a number of things we can do to help prevent your company from incurring attrition fees:
- We work closely with you to insure that your group reserves the rooms as accurately as possible. We recognize that unforeseen conditions may alter plans, but the earlier you let the hotel know of changes, the less likely it is that your group will under book.
- In addition, HPN provides you with a proprietary software reservation service. Using this service, more individuals will book within the company room block and the better your rates will be, and the less you will be charged for use of meeting rooms.
- For associations, annual meeting registration fees for each year are based on results from the past 1-3 years. If you need to budget attrition fees and other costs into the registration fee, it will rise.
- The higher the percentage of attendees who use the HPN registration service, (as opposed to booking direct) the better HPN will be able to help you reduce attrition.
- HPN has one objective: be successful in negotiating good contracts for groups, and that starts by understanding the complexities of a hotel attrition clause.
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