Hungry for more from your food & beverage (or F&B) spend? Most planners are. After all, what’s the main reason people go to meetings? To connect with others, of course. And where does a lot of the best networking happen? Over meals like catered breakfasts, lunches and dinners. That’s why it surprises me that more planners don’t leverage F&B minimums to drive more value for their meetings and events.
What’s an F&B minimum, you ask?
This is the minimum amount you must spend on catered food and beverage during your meeting. Sorry, F&B minimums don’t include restaurant or bar spend. And hotels measure them before taxes and gratuities.
So why are F&B minimums such a missed opportunity?
Planners work hard to reduce or eliminate them - even when it’s clear from the size of the group they’ll spend more than enough. The trouble is, they overlook the other side of the equation: When they spend more than the minimum, they never get credit for the difference.
Don’t leave money on the table. Use these four tactics to negotiate F&B minimums from a different perspective. You’ll stay on budget, while raising the bar on food and drink.
1. Create a tiered F&B minimum
Stack the deck in your favor by creating two F&B minimums – one for the hotel and another for your company.
Let’s say you’re booking a sales retreat, with 50 people for three nights. That’s three breakfasts, lunches and dinners, as well as one or more cocktail receptions. After doing your homework, you come up with these numbers:
- Estimated F&B budget: $16,000
- Hotel’s minimum F&B: $12,000
- Difference: $4,000 – in your favor
This additional $4,000 gives you real bargaining power. So here’s what to tell your hotel salesperson:
“I agree to the F&B minimum ... AND I want to add in my contract that if we spend at least $16,000 on F&B, we’ll unlock the following extra concessions.”
Need more suite upgrades or A/V concessions? A tiered F&B minimum is the icing on the cake. Use it to add the goodies you want to enhance your event.
But what if your budget is cut after you commit to the higher spend?
No worries. Suppose you got more suites and A/V concessions for your extra $4,000 in spend. If you must reduce your budget later, you’ll know exactly what to give back. Bottom line: You have nothing to lose and good value to add.
2. Find out the minimum for your meeting dates upfront
Most hotels have a minimum amount of F&B spend they must earn per room-night. As you probably guessed, this number depends on the time of year.
Request the hotel’s F&B minimum per-person, per-day. This number tells you exactly how much leverage you have. For instance, if your hotel partner wants $125 per-person per-day, and you were budgeting $150, you’re in luck. Agree to their number and put the tiered minimum we discussed earlier into play.
What if their F&B minimum per-day is out of your range?
Find out if it would be worth your while to move the meeting to other dates. Hotels are often willing to discount minimums and customize menu pricing – if the right group can fill a hole in their schedule.
3. Know your full meeting value
When hotels evaluate business, they consider three pillars: rates, dates and space. Because you plan meetings, you know a lot more goes into the budget than that.
- Do you use the on-property AV company for the general session and all breakouts?
- Do attendees arrive a day before the meeting and stay the day after? If so, they’re likely to dine onsite, right?
- Does your group close down the bar every night?
If the answer is yes, ask your hotel partner to estimate your group’s “out of the room” spend. Use this intel when you’re “lite” on your F&B minimum.
Knowing your meeting history will prove valuable when negotiating future meetings as well. Hotel partners will take your full meeting value into account before submitting their proposals.
4. Look at the Complete Meeting Package
Many planners don’t know about CMPs (Complete Meeting Packages). Do you?
Typically, a CMP includes breakfast, morning and afternoon breaks, lunch and basic audiovisual set-up (screen, projector, mic). Venues price CMPs per-attendee. This provide an easy way to know if the hotel can work within your budget.
CMPs are gaining traction today, and for good cause. Most hotels will customize a CMP for your group if the basic package doesn’t meet your needs. Leveraging CMPs may require a little extra work upfront. But they can save you time and spare you worry over costs down the road. Many hotels already have CMPs available. All you need to do is ask.
Planners often are surprised to learn their hotel catering partners are happy to break away from standard fare. They’ll customize flavorful dining options to fit your requirements.
So tell them your budget and what you want to accomplish. The chef may be thrilled to spice up the menu and depart from expected choices that are so yesterday.
Want to leverage F&B minimums to sweeten the pot with extras for your next meeting? Download our free guide: “How to Manage Your F&B Spend: 5 Delicious Tips.”