The Argument for Working with a Meeting Broker

The most common reason I hear from planners who are not using a broker to help source and negotiate their contracts is, “It costs more.”

As a planner for a significant portion of my 25-year career, I admit that I held that same viewpoint. I knew there was no out-of-pocket fee, but I believed what I had been told—that using a third-party would indirectly cost my company more. Then, I got curious and started asking hotel insiders and researching further into how commissions fit into a hotel’s total revenue strategy. The truth is that commissions are a standard cost of doing business, not an add-on cost. Whether or not a third-party is involved, hotels budget for commissions as part of their group sales expenses. If no intermediary is used, the hotel typically keeps that margin. Overall, market demand drives pricing, not commission. Rates fluctuate based on city compression, demand, and seasonality.

Hotels rarely pass commission savings along. Even if a hotel would shave a small amount off by avoiding commission, brokers like Simply Sourced often save clients far more by:

• Negotiating stronger concessions

• Avoiding contract pitfalls that can cost thousands

• Saving 20-40+ hours of sourcing labor

In practice, the partnership and advocacy of working with a broker yield greater net savings than any commission-free rate. That same budgeted cost now works for you by adding negotiation power, risk protection, and time savings.

~Amanda Wagner, CMP