A New Way to Do Business with the Federal Government

As meeting, conference and event planners, it is always a challenge to find ways to work with the Federal Government. The newest strategy we have seen in requests for quotes has been for NO COST contracting. This means that the planner is required to recoup all of the costs incurred in planning the event, usually including the meeting site costs. This is done through registration, exhibitor, and sponsor fees. The challenge is to determine reasonableness in building a budget based on anticipated costs and projected income, including no charge to government employees. This is, of course, much easier when you have a meeting that will draw your anticipated number of attendees, exhibitors, and sponsors. Sometimes the government gives you a range of attendees, which is another challenge for budgeting.

I know the government agencies are looking for ways to save money, but we must caution ourselves, not to lose money in the process of contracting with the government. One of the recent bids we did required no more than a 10% profit to the contractor. In building a budget, that is easy to project, in reality I am not sure how that works.

We find this to be a new and interesting trend. We have seen it in the private sector for a long time, but now the government is engaging in this practice, without a full understanding of the consequences. When bidding, you don’t have a contract with a meeting site, an audio-visual vendor, a drayage company, or a caterer. This means that much of what you use to determine a registration fee to propose to the government is based on your experience and best guesses as you are projecting costs.

We will keep you posted on how this trend as we continue in our efforts to work with the Federal Government.

~ Linda Begbie • Executive Director, RDL enterprises

Why is hotel food so expensive?

Lately, there has been a lot of chatter in the blogosphere about government excess and the $16 muffins and $8 cups of coffee that the Department of Justice had at a couple of their events (Here is the article that touched it off). Mind you, the article leaves out a lot of details behind the numbers and, instead, focuses on the particular items that are sure to fire people up. After all, they need an attention-grabbing piece to sell the news and including the details explaining how those figures came to be would have turned off most readers. The Meeting Professionals International (MPI) blog posted a response to it here, so I won’t go into that particular issue.

However, I have heard complaints for many years – from conference attendees and funders, mostly – about how expensive hotel food is. It certainly seems that way. $8/person for a coffee break, $22/person for a lunch, $34/person for dinner – you can certainly eat quite well as an individual at those prices, especially when you find out that these prices are “plus-plus”. Let’s examine each of these examples one by one. I’ll start with dinner, since that is the one most often referenced in conversations on this topic.

Dinner, at a hotel, typically includes a soup and/or salad, bread, the entrée (with sides), dessert, and coffee service. All of that is included in the $34/person. Now it isn’t fair to compare this to a fast food joint, like McDonald’s or Carl’s Jr. The two types of meal service aren’t even close. Meals served at conferences are more like eating at a restaurant – and a moderately nice one at that. If I were to get the same menu items at a middle-of-the-road restaurant in the same city as my conference, the prices (before tax and tip) might break down like this:

• Soup (or Salad): $5
• Bread: usually included for free
• Chicken Entrée: $16
• Dessert: $7
• Coffee or Tea: $3

Add that all up and you have…$31. Suddenly, the hotel’s pricing does not seem so out of line as it did before, does it? Yes, it is still a bit higher, but it is not shockingly so, which is what most people react to.

Lunch is very similar to dinner. For a restaurant lunch comparable to what a hotel might serve, you’re looking at prices something along these lines:

• Soup (or Salad): $4
• Bread: usually included for free
• Sandwich Entrée: $10
• Dessert: $5
• Coffee or Tea: $2

The total for a similar lunch at a restaurant is…$21? Yep, we’ve saved an entire dollar compared to the hotel’s pricing. Not much of a difference there…

Finally, let’s look at the $8 coffee. Yes, I know I said I wasn’t going to into it here but this is the one that seems to generate the most ire from certain folks and it is one area where your local coffee shop is way below the prices charged by hotels. Let’s look at in more detail…at $8/person for coffee service, what do you get? You get coffee service for a fixed amount of time (usually 1/2 hour), during which your attendees can pretty much drink as much coffee or tea as they want. How many of them do you think have just one cup?

When I order “in bulk” for coffee (to save money), I know that one gallon will give me 16-20 cups, depending on the size of the cups used by the hotel (see this post for more details). Will I order one gallon, then, for a group of 20 people? Probably not. I will want to have some extra available in case they drink more than I anticipated, even if this results in leftover coffee that no one drinks.

When ordering a break package, such as coffee service billed “per person” instead of by the gallon, the same principle is at work. The hotel does not want to run out of coffee (it makes them look bad), so they need to prepare more than they think people will drink. Plus, coffee service includes tea and decaf. The hotel needs to make sure that there is enough for people with those preferences as well. Your corner coffee shop (even Starbucks) can make coffee one gallon at a time and still promptly serve their customers. A hotel, trying to serve coffee to several hundred people all at the same time, must make much larger batches.

The upshot of all of this is that there is the potential for considerable leftovers (aka “waste”) with coffee service. Since the hotel must, at least, cover costs for providing it, they must take that into account – which results in higher prices. Even your corner coffee shop does this; their level of “lost product” is simply much smaller. In fact, every business that serves food must take wastage into account with their pricing or they will quickly be out of business. That’s basic economics.

So, does this mean that hotel food in not expensive? No, it’s still pricy – and I still think it’s expensive when I compare it to preparing a meal at home. However, when I compare it to eating out, I find that the prices are not too far off from what I would pay in a restaurant. Restaurants and hotel both need to cover not just the cost of the food, but also the costs of rent, equipment, staff wages, maintenance, and a myriad of other expenses that go into providing a service to the public – which means that it will always be more expensive than what it costs me to make the same dishes at home (assuming I even know how to make and have the time to make said dishes…).

So, the next time you hear a complaint about how expensive hotel food is, look at similar options before joining the chorus. You might find that the claims are right on track – or a bit overblown…

~ Karl Baur, CMP • Project Director, RDL enterprises

Women Owned Small Business in the Government Market

You may have heard that the Federal Government has really put an effort into getting contracts into the hands of women-owned small businesses. In February of this year, they formalized their certifications so that women-owned businesses are now required to go through a certification process. You can qualify as a Woman Owned Small Business (WOSB) or an Economically Disadvantaged Woman Owned Small Business (EDWOSB). The difference is not money, but whether or not your NAICS code (code that the government uses to identify your business type) is underrepresented or significantly underrepresented. Meeting Planning Services are significantly underrepresented so we qualify as an EDWOSB.

If you are registered with the government as a contractor, then go to the SBA login. If you are not registered, go to https://eweb.sba.gov/gls and set up an account. It is populated with the information from your Federal registration with CCR and ORCA. It is on this site that you get the information regarding what is required to qualify as a WOSB. You can upload the required information, or if you are already certified by one of the very few approved certifying organizations, (ours was WBENC) you can upload the certificate. You also have a form to complete. Once you have completed your paperwork, then go to CCR/ORCA and update your status.

I have not seen much in the way of Federal agencies doing set-asides for WOSB, but I keep hearing it will be happening in this next fiscal year. We certainly are hoping that we benefit from this new program. If you have any questions about how we got our certification and/or I can direct you to where you need to go to get started, please feel free to email me at Linda@RDLent.com.

~ Linda Begbie • Executive Director, RDL enterprises

Things we have learned since getting onto the Federal GSA Schedule

It has been quite the learning curve, figuring out the best ways to market to the Federal Government, as well as learning how the GSA process works. Here are some of the things we have learned so far…

1. You do get to see bid opportunities prior to the general public, although sometimes they have a short turn around time
2. Your questions often get answered immediately
3. You still have no guarantee of winning the bid
4. You can still ask for a debrief if you are not awarded the bid
5. If you have a positive relationship with a contracting officer and the bid is less than $15,000 they can send the request for a quote out to three organizations on the GSA Schedule and select one of them for the award
6. Relationships, relationships, relationships - they are always the answer for growing your business, even with the government

If you are already registered to do business with the government and are interested in getting onto the GSA Schedule as a small business, check out http://www.gsa-sba.com. There are many businesses that will write up your application for you for a fee, but if you want to do it yourself, there is help. We used the local Federal Technology Center and the gentleman we worked with was more than helpful. It took over a year to finally get approved but it finally happened. It is now up to us to keep up with all the different ways to find opportunities to work with the government. They include:

• FedBizOps
• Ebuy.GSA.gov
• FedConnect.net
• Contacting contracting officers who have sent out bids for services similar to what we offer
• Researching the budget forecasts for agencies that plan meetings and events

If you are thinking of working with the Federal Government, there are some new programs that are being targeted for woman owned small businesses that are designed to be set-asides for those services and products where women are underrepresented. Check with your local SBA office and they can you started.

~ Linda Begbie • Executive Director, RDL enterprises

Marketing to the Government

In RDL’s continuing efforts to find ways to work with the Federal Government, we recently attended an “OSDBU Procurement Conference” (Office of Small and Disadvantaged Business Utilization) in Chantilly, Virginia. This conference was a national conference that fosters business partnerships between the Federal Government, prime contractors, small, minority, disabled veteran, and women-owned businesses. There were over 3,000 attendees, a number of plenary sessions and breakouts throughout the day, and more than 1,000 exhibitors. All opportunities were definitely beneficial to those attending. Throughout the day, though, the main component was “networking”.

Prior to attending this big event, we researched the various government agencies represented at the conference, as well as the prime contractors. The goal was to see who had the need to plan meetings and conferences for the year and who had the funding to make it happen. At the end of the day, we walked away with about 30 new contacts. Throughout the day we met people to follow up with and to make part of our social network. We hope that we will be able to establish working relationships that will be professionally rewarding for all parties. The next step is to follow through. Each of the contacts has received an email, a capability statement, and will be added to our Newsletter list. We will use every opportunity to remind them about our services.

It was a great experience for us to be able to meet and connect with so many large and small businesses across the country. We are all learning that small business teaming together can be awarded Government Contracts where the small business can make a big difference.

Learn more about Government Contracting at www.openforum.com/governmentcontracting

~ Cyndy Hutchinson • CFO, RDL enterprises

RDL enterprises Joins the GSA Schedule!

The staff at RDL enterprises has spent the last year working through the application process with the Federal Government to be awarded a GSA Schedule. This schedule puts RDL on a list that State and Government contractors can go to and locate services to bid on for up and coming contracts, as opposed to posting it on a public website. We are pleased to announce that we received our GSA approval on March 8th, 2011!

There were many steps in the application process and reams of paperwork & Internet searches. We were able to connect with the local Federal Technology Center and can’t say enough about the positive support we got from their representatives. This service is provided at no cost to small businesses.

LD Ventures, dba RDL enterprises, submitted its application last March and were told over and over again, by the GSA office, that our application was in the very tall pile of other applications for review. We finally heard from the GSA office in December 2010, that we had some additions & corrections to make on our application.

Finally, in February, all the paperwork was finalized. Now that has been completed, the next step is to create our personalized GSA Schedule for approval and then we will need to upload our schedule to GSA’s eLibrary. Once that has been completed, our schedule will be available for other federal contractors to locate us for services our company can provide, as well as government agencies.

Now that we’re on the GSA schedule, we have to market, market, & market some more to the federal agencies where we believe our meeting, conference, and event-planning services are needed. On that note, the Executive Directors of RDL will be flying to Chantilly, Virginia in April to the Annual OSDBU Conference (Office of Small and Disadvantaged Business Utilization). Attending this conference will be our first big step in networking with many of the federal contractors that may be interested in purchasing our services.

Working with the Federal Government is a huge challenge, but we at RDL are excited about the opportunity to meet that challenge. So, with GSA Contract number in hand, we are off for an adventure in Government Networking! We are going equipped with all of our new tools, so wish us luck! It will boost our confidence even more!

~ Linda Begbie • Executive Director, RDL enterprises

What is a Force Majeure Clause?

If you’ve done many contracts for meetings or conferences, you are probably familiar with the Force Majeure section (sometimes called “impossibility” or “acts of God” clauses) of hotel contracts. It's purpose is to protect the parties involved in case something catastrophic happens that makes it impossible for them to fulfill the terms of the contract and, if you are not familiar with it, you should be.

A basic clause may run something like this: “The performance of this agreement is subject to termination without liability upon the occurrence of any circumstance beyond the control of either party to the extent that such circumstance makes it illegal or impossible to provide or use the hotel facilities.”

The clause will usually go on to include examples of what qualifies for exercising the clause (disaster, war, civil disorder, government action, etc.) and what does not (such as strikes involving agents of the side seeking protection of the clause). An action date is typically included as well – the party seeking protection must notify the other party of their intent to use this clause within a certain time frame of the circumstance becoming known. The Force Majeure clause can be long and detailed or short and to the point. In either case, it should incorporate a few key elements.

First, the basic wording must be there, acknowledging that circumstances beyond the control of either the planner or the hotel may make it impossible for one or both parties to meet their contractual obligations. Immediately after 9/11, for example, many meetings were canceled due to the grounding of flights nationally for some time after the attacks – people simply could not get to meetings that required air travel. This was an event well beyond the control of the planners that made it impossible for them to meet their contractual obligations to hotels.

Second, including examples is a good idea. That helps make clear when the clause can be used and when it cannot. If there is a specific circumstance that concerns you, be sure to include it if the hotel does not have it in their existing language. For example, if you are concerned about hurricanes, include that in the list of examples. If you work with government groups, failure of the legislature to pass a budget may mean that the group will need to cancel – government action (or, in this case, inaction) could make it impossible for the group to meet its obligations.

Third, do include a “window of action” to make a decision. Once notified that a particular circumstance exists that could be a problem, immediate action should be taken – too long of a delay in activating the Force Majeure clause effectively means that you agree to continue with the contract as written.

Finally, and this one is the most important in my mind, the clause must be reciprocal. This means that it imparts the same protection to both parties. At one time, I saw many contracts with Force Majeure clauses written so as to provide protection for the hotel but none for the group contracting with them. So, a hotel could say that the recent earthquake made it impossible or unsafe for them to meet their obligations to the group but the group had no such option available to them (contractually). Fortunately, this has changed considerably over the years and most hotel contracts now do have reciprocal language here. Double-check it, though. Occasionally, I will still see one that protects one side and not both. When that happens, I make sure to change the clause to protect both parties.

~ Karl Baur, CMP • Project Director, RDL enterprises

What is Happening with Federal Travel

Recently the Federal Government issued a Federal Travel Regulation Bulletin (GSA Bulletin FTR 10-6) regarding Travel Policies and Practices. The stated purpose of this bulletin is to “enhance travel cost savings and reduce green house gas emissions.” This travel policy was established in response to the President’s Executive Order requiring heads of agencies to consider reductions associated with “implementing strategies and accommodations for transit, travel, training, and conferencing that actively support lower-carbon commuting and travel by agency staff.”

The travel bulletin goes on to say one of the ways to enhance cost savings is by reducing or eliminating travel. The new guidance encourages eliminating travel when possible by utilizing technology in lieu of travel. Agencies are encouraged to use teleconferencing, video conferencing, webinars, social networking options, etc. We have heard all of this before. It will be interested to see if we see an increase in demand for electronic conferencing.

Both travel costs and carbon reduction strategies are encouraged in the guidelines when planning any travel. Suggestions include traveling lighter (less luggage), using public transportation, and ridesharing and or walking, to and from lodging and meeting sites. When cabs are used, the traveler is encouraged to use cabs that use alternative fuels. If rental cars are required, the traveler is encouraged to use the smallest, most fuel efficient vehicle or if available under a government agreement, use alternative fuel or hybrid rental.

Lodging should be “Green”. Travelers are encouraged to look for lodging that is LEED certified, or has an EPA Energy Star rating or participates in EPA’s Waste Wise and Watersense program and has a stated commitment to practicing environmentally preferable purchasing in the products and services used. The guidance also asks travel to participate in the hotels reuse of linen to conserve water and recycling programs. It also encourages turning off AC/Heat, radio and TV in the room when leaving. These are good suggestions for all us as we travel for either business or pleasure.

When hosting meetings and conferences requiring travel, the guidance encourages strategies such as offering an alternative for remote conferencing, ensuring the site is easily accessible to public transportation, assuring the property incorporates green principles, and that if possible, schedule concurrently with other meetings so attendees can overlap their attendance and avoid multiple trips.

What does that mean to both government planners as well as independent planners? I think this is the wave of the future and we should all consider these guidelines when working with all of our clients and planning for our future events.

~ Linda Begbie • CEO & Executive Director, RDL enterprises

Ed Note: If you are traveling in or to California, check out this web site for a list of green-certified hotels and learn what it takes for them to become certified. - KB

An Update on What is Happening in the Hotel Industry and How it Affects Meeting Planners

An article in the Oct. 11, 2010, edition of Business Travel News (posted online October 15th) warns meeting planners to expect more difficult negotiations in 2011. According to the author, attrition clauses, demands for room cut-off dates, and deposits will become much less negotiable and planners should be prepared for this new trend. The article goes on to say that planners can still expect to negotiate freely for food and beverage credits, room upgrades, and waivers on resort fees and parking. This is helpful to know as we begin moving forward in sending out RFP’s and negotiating for sites for future meetings.

We have all been reading room rates are rising. One source for the article predicts that we could see anywhere from a 7 – 11 percent increase in room rates. Others have projected a 5 percent increase. I think we have all been expecting this increase and have just been waiting. This can be interpreted as an optimistic move on the part of the hotel industry. We also are encouraged to watch out for the hidden fees such as occupancy tax, resort fees, etc. Some properties have increased those fees in order to keep their rack rate low, yet still raise their bottom line.

The one thing not taken into account is the issue of Video Conferencing. Everyone pays lip service to this type of meeting as it a method of cutting travel and lodging costs. The question is how will this affect the bottom line in the hotel industry? Are they gearing up for meetings that include this component? If not, they need to be developing marketing strategies to the planners with ways for attendees to be video conferenced into a live event. We are constantly dealing with this issue with clients and expect to see an increase in this demand as the government begins implementing their new travel guidelines. An increase in room rates may not deter a client from using a convention property, but not having the facilities to conference others in or do a live feed out could eliminate a property from consideration.

We would love to hear your thoughts.

~ Linda Begbie • CEO & Executive Director, RDL enterprises

A New Direction for RDL?

As independent meeting planners, we are all wondering “where is all the money that used to go into meetings and conferences?” More state agencies are doing meetings in-house and, even in the private sector, companies are cutting back on the number of trainings and events that they are doing. So is anyone still doing meetings…?

I recently spent three days in an intensive training on how to find opportunities to work with the one sector that seems to have money to spend – the Federal Government. Not having done much work with the Federal Government before, there was a lot to learn! Once we learned how to navigate the government websites and received the correct codes and labels, we began searching for agencies looking for meeting planning services. To our surprise (and great pleasure), several opportunities have already come up in the short time we have been searching. They are still doing meetings and hiring meeting planners to do them!

We’ve also learned that the government expects you to do a lot of work before you can even submit your bid – and that work has to take place in a very short amount of time. Unlike most of our clients, where fees and event costs are separate, the entire cost of a federal event is included in the bid and if you underbid, then you pay the difference. This means we do a great deal of research, gathering numbers, looking for available meeting sites, hotels, etc. prior to putting the proposal together. Most of the time, writing up the scope of work for the bid is the easy part.

We have not yet had any success in this new endeavor but we are looking forward to beginning work with the Federal Government and expanding into this new arena. Though taking RDL in this “new” direction could certainly change our business to some extent, our core services will remain unchanged. And, no matter what new path we follow, we will always be meeting planners.

- Linda R. Begbie, Executive Director & Meeting Planner