Thursday, January 21, 2010

Working With External Audio Visual Vendors in Hotels

With the downturn of the economy, certain industries have been hit harder then others. One in particular is the Hospitality community and to further protect future monetary losses, hotels have been issuing new clauses to ensure you keep the majority of your business in-house including audio visual and decor services. In theory, one would assume this would be an ideal situation for the client, but with the internal vendors charging top dollar and often lacking in customer service, the Client is clearly not receiving value and if they choose the external vendor, the hotel is trying to force a substantial fee to bring in the services.

As a planner you need to know that this is not a forcible contractual obligation and as a consumer you have the right to choose your own vendors without penalty. Please read through this article below to help you combat this new trend.

Customers: you must be aware of contracts that may affect your ability to work with your chosen suppliers


As a meeting planner, you may have run into a situation where a hotel or convention center has pressured you strongly to use their designated audiovisual supplier. Ultimately in such cases, you usually do have a choice, but the

decision to use your own supplier may come with a cost - frequently, it can result in operational restrictions and surcharges, based on your contract with the meeting facility.


This situation is becoming more common at meeting facilities throughout North America. Meeting facilities are trying to leverage their position as providers of meeting space to influence customers to use their recommended suppliers. This

is natural, as facilities can earn a significant commission from their in-house suppliers. Conversely, if you bring in your own suppliers, they lose out on this potential revenue.


As a meeting planner, you need to be sure that this trend does not conflict with the interests of your organization. You go to considerable trouble and expense to hold meetings, and you do so in order to share important information – your

“message”. AV technology is the medium by which you communicate that message. Therefore, the AV component of your meeting is “mission critical”- if it fails, it compromises the success of your entire event. For this reason, you want

to be sure you are able to choose the AV supplier that is best for you.


There are many policies, commonly applied by facilities in the interest of safety or law, which are fair and reasonable. Likewise, there are fees that can be justified by added value to the customer, or by an underlying cost to the facility.

However, some policies and fees appear to be designed specifically to influence or restrict a customer’s choice of suppliers, or to limit the activities of those companies hired directly by that customer.


Often, these policies and fees may not be apparent to meeting planners at the time they are booking space, as they are not covered specifically in the space contract, but are contained in the facility’s operating policies & procedures

manual. These come to light only after the contract is signed.


Therefore, it is important to insist that you are informed about all AV-related policies and charges, before you sign your facility contract. When you contract with a facility to rent space, you should also make it clear that you expect them to

respect your established relationships with your suppliers, and that your contract for meeting space is legally unrelated to your contracts with any other vendors.


Following is a description of some of the more common policies and fees relating to audio-visual services at meeting facilities. Also included are opinions as to your rights as a customer, and some guidelines as to what should be considered

fair and reasonable.


Know your rights


Your specific rights are spelled out in the contract that you sign with a meeting facility. Most facility contracts, by their nature, are tailored to suit your specific needs. However, all contracts should still be reviewed to identify any clauses that

may limit your opportunity to use an AV vendor of your choice.


In general terms, when you rent space from a meeting facility, the facility will spell out what activities you may or may not conduct in that space. Otherwise, subject to further restrictions expressed in the contract and subject to laws of

general application, the space is yours to do with as you please.


A facility cannot prohibit you from using your own equipment, or rented equipment, in meeting space that has been rented by you, provided such use is consistent with the purpose for which the space has been rented, and provided

such equipment conforms to local safety standards.


Under the law, any equipment or staff hired by you for a meeting are deemed to be under your control, as if they were your own. Therefore, 3rd party equipment and staff are subject to the same rules and conditions that apply to your own.

Policies and fees relating to AV activities in facilities vary widely from place to place, but simply put, if they are in your contract, you are bound by them. If they are not, the facility should not expect you to comply with them. Fees related to

such policies should be based on a published price list, and should be the same for all customers, regardless of what AV vendor they hire.


Access to the building


Unless otherwise stipulated in your contract with the meeting facility, you have access to those areas of the building that are required for you to move equipment and people in or out. This includes 3rd party staff and equipment hired by you.

The meeting facility has the right to know who your 3rd party hires are, and their move-in/move-out schedule. However, they do not have the right to charge fees to provide access for them, unless such fees are specified in your contract.


Rigging


It is reasonable for a facility to stipulate rigging regulations, or to designate a rigging contractor in the building, as there are legitimate safety and infrastructure concerns related specifically to rigging. For safety reasons, a facility will often

require that you submit a rigging plot for approval in advance - 2 weeks before the event is a typical time frame.


As well, a facility may reasonably require you to rent any equipment that attaches directly to the building from it’s rigging contractor, and to charge a fee for attachment to permanent rigging points in the ceiling. However, the facility should

not require that you use any other of the rigging contractor’s equipment.


A facility should be able to provide you with scale drawings of their ceilings (both hard-copy and electronic), a current engineer’s report with weight ratings for all rigging points, and the credentials of the riggers working on your event.


Electrical services


Electricity available from the permanent outlets in meeting rooms is included in the cost of your meeting room rental. It is, however, normal for a facility to charge additional fees for electricity required above and beyond this. They will probably

ask you to submit a schedule of such extra electrical requirements in advance - 2 weeks before the event is a typical time frame.


It is reasonable for a facility to designate an electrical contractor in the building to provide any such extra electricity requirements, as there are legitimate safety and infrastructure concerns related specifically to electrical services.


Patch fees


Many facilities will restrict the use of the sound systems built into their meeting rooms, in order to protect those systems from misuse. If you wish to have your own AV vendor connect to these systems, the facility will often charge you a

“patch” fee, in order to do so.


Typical patch costs range from $30-$50 per room per day; anything more than this is generally considered high. These fees are frequently negotiable, provided such negotiation is done before your contract is signed.


Storage


If your event requires an AV storage room, it is your responsibility to provide this space for your vendor from within your meeting space block. Aside from this, storage of equipment or cases within your contracted meeting rooms, including

backstage areas, should not be unreasonably restricted by a facility. You should always include an AV storage room in your initial meeting space negotiation, as there may be an extra cost for this space, if it is requested after the fact.


Security/supervision fees


A facility should not force you to hire their security or supervisory personnel to monitor the activities of your AV vendor, any more than they would to monitor your own staff’s activities. This is an example of a policy that is becoming more

common, which seems to be designed specifically to deter customers from bringing in outside companies.


Commissions, access fees, & surcharges


It is inappropriate for a facility to charge you a commission, access fee, or surcharge related to your choice of AV vendor. Likewise, they cannot solicit such a fee from your AV vendor, with or without your knowledge, or restrict access by

your AV vendor to their premises, based on refusal to pay such fees.


How to keep your options open


The following clause, titled “Buyer’s rights regarding third party suppliers” is designed for inclusion in your initial RFP to facilities, and also to be appended to your organization’s standard facility contract.


Buyer’s rights regarding third party suppliers


Buyer will not accept or agree to any proposal or contract containing conditions, terms, or clauses which unreasonably restrict our choice of third party suppliers for our event(s) at any meeting facility, whether such conditions are expressly

stated in the proposal or contract, or whether they are contained in the general operating policies of the facility, be they published or unpublished.


Furthermore, Buyer will not accept or agree to any fees, surcharges, or penalties of any type charged by a meeting facility that are in any way based on or tied to our choice of third party suppliers, whether such fees are expressly stated in the

proposal or contract, or whether they are contained in the general operating policies of the facility, be they published or unpublished.


This “Buyer’s rights regarding third party suppliers” clause shall be appended to all contracts that are executed by Buyer, and if it is determined that this clause is in conflict with any other clause, portion of any contract, or any

general operating policy of the facility, then this “Buyer’s rights regarding third party suppliers” clause shall be deemed to take precedence over the other item(s) with which it is determined to be in conflict, unless specifically agreed

otherwise.

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