Buyers will need to address a few issues specifically related to Covid-19 in negotiations this year, including:
- Cleanliness standards. All buyers should confirm cleanliness standards as part of the negotiation process. The enforcement of social distancing and cleanliness standards in guest rooms, meeting rooms and other common areas is paramount, and measures will need to be addressed in contracting.
- Amenities. The need and availability of hotel amenities will be different. For example, what will free breakfast entail? Will “grab and go” replace the buffet? It may not make sense to negotiate in breakfast or even the shuttle service if buyers are not confident that the appropriate social distances measures are in place or if travelers will not be comfortable using the services.
- Room availability and upgrades. The fact that many hotels will be operating at lower inventory levels, with many operating at 50 percent capacity, make room type negotiations more challenging for some buyers. The likelihood of securing room types beyond standard will decrease, and it will be incumbent on buyers to sharpen their pencils in to obtain upgrades for their travelers.
- Cancellation policies. While hotels currently are offering flexibility with bookings to spur demand, they might adjust their cancellation policies down the road, given the planning and costs hotels need to apply to spacing out incoming and outgoing guests and having guests placed in every other room and other measures to manage guest flow. With inventory constraints and social distancing measures, cancelations will be more costly for hotels and they will likely need to apply more stringent penalties which could result in increased costs for buyers in the form of fees. Cancellations and penalties are a negotiable item in the RFP process, and buyers should be prepared to address them.