The days when convention centers could give away extras--like free water at drinking fountains instead of $55 water cooler rentals--are long past. Many of these facilities, which used to operate as "loss leaders," are now expected to operate in the black as local governments cut back on subsidies. Because centers were originally built as money losers, "for years event organizers have not been paying full freight at convention centers," says John Swinburn, vice president of operations for the International Association for Exposition Management (IAEM). Not anymore.
The criteria by which convention centers evaluate a piece of business (dates, square footage of function space, and number of hotel rooms) is still the same. But in today's market, facilities analyze the potential for a range of revenue streams from the meetings business. That means unexpected charges in just about every area. Look for hidden charges for the following services when you negotiate with a center:
Rekeying locks--These charges have increased up to seven times at some centers.
Sound systems--You might face an unexpected $10,000 price tag if you use the center's system. Negotiate to pay only labor charges to have the system set up.
Document copying charges--Some convention centers may try to insist that all copying be done through their business centers, which may charge more than a commercial copying store.
Attendee shipping--A convention center may try to stipulate exclusives on shipping charges, as well as on cell phones and computer rentals.
Security--This service, usually an exclusive, has gone up as much as 35 percent recently at some centers.
Chair rentals--These should be included as part of the package.
Catering--In most cases, there are no volume discounts; a dozen bagels can cost $30 inside a convention center. But you can cut costs: One example is to order soda by the liter or serve it from a pre-mix (as in soda fountains) instead of using cans, which can run in excess of $2 per can, plus tax and service charge.
Ventilation and lighting charges- Organizations usually must pay for heat or air conditioning on moving days. Some facilities provide only 25 percent illumination on those days, and charge an hourly fee for full-power lighting.
Trash--Some facilities charge to remove trash from the exhibit aisles. (Exhibitor trash is handled through the decorator.)
Water--There may be a charge for putting water on tables in meeting rooms.
Linens--There can be a $2 to $5 charge to put tablecloths on session room tables. Some facilities won't do it at all, and insist that decorators handle this service.
Reset--Halls normally charge to reset a session room, but some may try to charge to set up a room for a catering function. Such a setup is usually covered by the service charge levied on catered events.
Rigging--Exhibitors are used to rigging charges in the exhibit hall, but a company holding an exhibition is generally responsible for rigging fees in session hallways and general session areas.
Inventory--With so many expansions, some convention centers are having a hard time keeping up their table and chair inventories. The facility may allow you to use your decorator's inventory to make up the difference, but the decorator may not want to do this because of concerns about theft.
Scheduling--Some centers do not allow you to set up registration areas until after the previous event has closed for the day, which may mean time-and-a-half charges.
Paramedics--Some facilities require that your company hire a center's contracted paramedic team instead of hiring one paramedic on your own. This can triple the cost of the service.*
Read This Before You Sign on the Dotted Line Convention centerare notoriously long, and often have many addenda. "It's shocking how few meeting executives really read these contracts," says Jed Mandel, & Incentives' legal columnist. They may be overwhelming to read, but "it's even more overwhelming when they come back to haunt."
Beware of clauses like "incorporated by reference," which refers to rules and regulations in the center's operations manual without spelling them out, Mandel cautions. Ask to see a copy of the manual before you sign a lease. Be wary of or "to be negotiated" clauses that may permit the center to charge you for unspecified items. "Eliminating these clauses is rare, but you can put limits around them to make sure they are not imposed without your knowing in advance, and what it will cost you," he says. Other tips forconditions include:
*Indemnification and hold harmless clauses: You don't want to hold harmless the convention center for its own negligent acts, Mandel says. Most convention center contracts are written with broad indemnification clauses.
*Cancellation and termination policy:Most contracts do not allow for cancellations. A clearly defined agreement with parameters for cancellation and penalty payments is critical.
*Insurance:Mandel is seeing more and more redundant insurance requirements. Sit down with the facility staff to eliminate or minimize redundancy.
*Renovation clauses: These are very important because so many facilities are renovating. Negotiate advance notice of construction and protection against noise and other disturbances.