Tips for future-proofing your budgets from a contract expert
When budgets and availability are tight, how do you negotiate from a place of relative strength?
Multiyear contracts can increase the attractiveness of your business and booking in advance can get you discounts in the current year while locking in certainty in future years.
Rob McCulloch, executive vice president with ConferenceDirect, has used the strategy for his clients and shared some tips for preserving flexibility while locking in rooms. I asked him for some tips.
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Smart Meetings:
Are you seeing more multiyear contracts as companies try to get ahead of rising costs?
Rob McCulloch:
We are seeing more multiyear contracts, in addition to more proactive incentives to close group business from hotels and CVBs in general. These changes are related more to the softening demand from the international and government segments that we have seen in 2025 and are continuing in 2026, coupled with slightly softer demand from the group segment.
As group and luxury travelers continue to be the strongest segments, hotels are focusing more on ensuring they are capturing their share of this business in order to have a successful year in 2026 and beyond.
For the short term (think events arriving in 2026 and 2027), knowing the value of your program will yield significant savings due to the need that many hotels have to shore up their books for this year, replacing other segments that are not performing.
For further out (2028 and beyond), hotels and destinations are still prioritizing larger events that will consume a majority of their inventory each night, so knowing the value of your program size and spend and finding the properties and cities for which your program best fits their needs is the key to unlocking multiyear contract value, regardless of the size of your meeting.
Smart Meetings:
What items that can be negotiated in a multiyear contract?
“Consider rotations through cities that offer compelling incentives.”
— Rob McCulloch
Rob McCulloch:
As with all pricing and negotiation decisions, each situation could be different, depending on the dates of the event, the pattern, the additional revenue contributions from food and beverage, audio-visual and the booking window (time to arrival) of the meeting.
But when the hotel and/or destination sees the business opportunity as a strong overall value, we have seen an appetite for more competitive room pricing, elimination or reduction of fees and more competitive pricing from the onsite audio-visual company from the first quote.
Read More: Leisure Fees vs. Group Fees: How to Price and Explain the True Cost of Meetings
F&B concessions are coming back, but it has been harder to acquire deep discounts due to the rise we have seen in commodities and labor over the past three years. It is hard to gauge how much more these could rise in 2026 due to the ongoing uncertainty in the economy.
Smart Meetings:
What are some “release valves” you can put into a multiyear contract to take into consideration uncertainties such as inflation, attrition, etc.?
Rob McCulloch:
In the scenario where you have a valuable program with strong historical pick-up and spend, it may be possible to have a more flexible attrition percentage, room block reduction options and locked-in future pricing and fees as a part of the final contract. This provides significant confidence for organizations that they will be able to budget for and perform to the terms of the agreement, allowing them to take advantage of the softening market now but for future meeting needs.
Smart Meetings:
Any other advice when considering a multiyear contract?
Rob McCulloch:
In addition to focusing on multiyear agreements by hotel brand, consider rotations through cities that are also offering compelling incentives to bring future group business to their destinations. A strategic and collaborative approach to this can yield exceptional value for the organization and provide for outstanding attendee acquisition and engagement.
This article appears in the March 2026 issue. You can subscribe to the magazine here.
