The 4 R’s of Brokering Hotel Rooms

September 08, 2015

Over the last five years, Hotels for Hope has brokered rooms for 7,600+ groups.

Seeing that number gives me goosebumps. And so does thinking about the road we have traveled and the people we have helped.

H4H runs on room nights. We think of room nights as the oil that keeps our engine running. We do everything possible to keep the business moving forward…which means H4H must examine room nights in a much different fashion than most. With every room night, we invest in new technology, service and funding for worthwhile nonprofits.

At the core of each event, is a service level offering: brokering rooms. Clients must put their trust in our ability to properly broker rooms for attendees. With that trust, we push an increased number of room nights through our infrastructure — producing value for everyone involved. Brokering rooms is such a vital component of our business. Because of that, we’ve created a simple mantra.  Today, in a transparent fashion, I’d like to share Hotels for Hope’s 4 R’s of Brokering Rooms. Each “R” relates to an intricate component of brokering rooms…

1. Relationship

R-1

The first “R” is the most important one. Relationship. We are in a business that is dictated by relationships. Over the last five years, our Crew has spent endless hours building relationships to ensure everyone benefits. We’ve worked with 3,000+ global hotels and 7,600+ clients. Each of those interactions creates an opportunity for us to expand our brand.

But what good is a business relationship if a client, or hotelier, can’t trust you?

Keeping that in mind, the H4H Crew first seeks to build long lasting relationships. By building solid relationships, we convert prospective clients into happy clients…and friends. In the same respect, we have vertically integrated our relationship(s) throughout the hotel industry. Our Crew knows thousands of hoteliers and has relationships with every major brand on a local, national and global level.

Simply put, we are not interested in business if we can’t parlay preexisting relationships or build on new ones.  It’s for the benefit of all stakeholders.

2. Rate

R-2

When brokering rooms, usually a client’s first question is “Can you negotiate a better rate?”  While room rates are important, they aren’t everything.  The second “R” is our belief that business deals are intricate.  Hotel room rates are the most tangible component of a good negotiation.

Historically, we’ve saved clients 25.4% off “Best Available Rates.” But the story doesn’t end there.

In life, we hire realtors to do more then just negotiate a better purchase price. A good realtor produces value in different arenas – negotiating closing costs, mitigating risk, suggesting monetary assistance with repairs, etc. The same is true with brokering hotel contracts. Yes, each client wants to save on published room rates. It’s also our job to dissect an event, seeing if value can be created through reducing costs associated with meeting space, food & beverage, audio visual, etc.

In practice, we start by examining who owns financial responsibility.  Are we working on a client’s regional sales meeting?  If so, the master bill is owned by the client and rate savings is simply one component of the final bill.  Are we working on a music festival?  If so, the event organizer might benefit more so from staff concessions rather than reduced patron rates.  We must keep this in perspective.  Value can be derived from a number of areas while brokering rooms.

3. Reciprocity

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The third “R” comes from our belief that stakeholders should expect the same from H4H as we expect from them (That’s the Golden Rule…right?!?!).  When brokering rooms, we spend a substantial amount of time creating an eco-system for success.  This includes building a RFP, interacting with hoteliers, negotiating terms, administering site tours and dictating processes for booking rooms. We expect clients to work exclusively with Hotels for Hope.  In the same respect, clients place a lot of trust in our hands.  Therefore, we must go above and beyond to ensure that H4H has a client’s best interest(s) in mind – acting to make decisions which result in positive event experiences.  Finally, reciprocity is earned through our vendors – most notably, hotel partners.  Hoteliers expect that H4H is continually identifying new pieces of business that bring value to their hotel.  Understanding that through continued loyalty, they will work collaboratively to ensure a client’s event receives the proper attention and value.

Reciprocal relationships require a spirit of cooperation, as well as an understanding of and ability to embrace interdependence.  To cultivate a lasting business relationship, all parties must be committed and receptive.

4. Risk

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We all take risks in life. It’s how we learn and grow.  When brokering rooms, stakeholders must take risks. It’s H4H’s job to create an environment in which all parties are comfortable with the risk they are taking on.  Once rooms have been brokered, we move into the contracting phase.  When clients sign a hotel contract, they are taking on a certain level of risk.  In the same respect, a hotel is taking on risk by allocating inventory that could otherwise be sold to another customer.  Therefore, one of our primary responsibilities is to ensure clients and hoteliers equally share in risk while allowing each party to “sleep well at night.”

In “Rate” we acknowledged financials are not always tangible.  The same holds true with “Risk.”  Within hotel contracts, risk is generally perceived in attrition and cancellation.  H4H works with clients, and hotels, to negotiate contract terms and identify potential areas for risk mitigation.