Costs for “Venue Exclusive” Production Services Can Add Up Quickly
Sometimes it’s what you don’t see that can sink your ship. Planning and executing successful meetings for your organization can be an undertaking of a Titanic proportion. For every decision you make that shapes the meeting, there will be other issues that lurk beneath the surface and which are not readily apparent. These hidden hazards can easily put a big hole in your budget.
As the buyer of services from a venue, you have lots of leverage to negotiate the best terms for your event. You must consider everything before you make a venue selection and especially before you sign any contract with the hotel or convention center.
I would like to offer some thoughts about the technical support of your event; to shine some light on the things that are not immediately apparent.
A Costly Surprise
All too often, I get the call from a client after they have already concluded negotiating terms for the rooms, food and beverage portion of their meeting. The technical support of your meeting can be a pretty sizable percentage of the event’s overall budget. Prior to your site survey, you most likely have taken into account the technical support costs from a previous event. If you have not done the due diligence on the venue you are considering, you could be in for quite a costly surprise when you begin to make the technical support plans.
Upon your first venue visit, you may have the chance to meet the in-house audiovisual preferred supplier and their technical team. If so, they will offer information about the technical services provided at the property.
These technical services generally fall into two categories: venue exclusive services and venue optional services. When I review these services with my clients, I think it is important to understand which services your event is going to need and then determine which services at the particular property fall into each category. I also make an effort to determine which of the services are negotiable.
Traditionally, the venue exclusive services include power connection, rigging points and rigging labor, house patch for house systems, Internet and phone connection. Venue optional services are supposed to include everything else.
However, venues are looking for ways to secure added revenue by including the optional services into the venue exclusive category. These services can run the gamut from the required venue provision of truss and motors to the venue provision of all AV gear and labor for breakout rooms. There are even hotels in Las Vegas that require the client to payroll all of the technical labor through the in-house AV company.
Since there is almost always a financial arrangement between the in-house vendor and the venue, those costs can be much higher to account for commissions paid by the in-house vendor to the venue. These costs can add as much as an extra 30 to 50 percent in additional costs to your existing technical budget.
Using Las Vegas as an example, stagehand labor is normally priced by outside audiovisual providers at $65 to $70 per hour. The hotels that claim labor as an exclusive service, however, price the very same labor between $90 and $100 per hour. That is almost 50 percent more in cost for the exact same labor you could secure were it not an exclusive service.
Recently, a client of mine received a proposal from a venue’s in-house AV provider for their exclusive rigging services on a show. The in-house provider’s proposal would have added $38,000 in rigging costs to their budget, had they signed on the dotted line. Instead, we modified the technical plans to give the client the option to ground support all of the AV systems for less than half of the cost of the exclusive rigging, thus achieving a significant savings.
A colleague of mine at LSAV had a similar experience in which the in-house AV provider proposed $63,000 of exclusive rigging services to the client. We offered some guidance and technical expertise, and the client was able to negotiate this price to less than half of the proposed price without compromising or sacrificing any the required rigging.
Look Before You Leap
Many planners find out the hard way that there are exclusive service commitments and costs hidden beneath the surface after they sign a venue contract. These stealthy agreements are usually covered in the venue contract. They might be found within innocuous language that binds the planner to abide by hotel guidelines or the “policies and procedures.” These guidelines or policy statements might even be published in a separate document. When venues are working to secure your business, they may not include any specific language addressing these services in their proposal. Therefore, it is in your best interest to determine which exclusive costs you absolutely have to accept and then negotiate out the rest.
So before you even reach the proposal or contract stage, it is important that you take steps to preserve your options and maximize your buying power. You can accomplish this by asking some pointed questions about the technical services you need.
I recommend consulting with a technical specialist to determine the general technical needs for your planned event. These specialists can visit the venue with you or review the venues before your visit. This insight will give you the knowledge to make an informed decision. Independent audiovisual production experts can also help to point you in the direction of solutions that may reduce the need for hotel exclusive service. Limits of weight loads and power service availability at a venue can be mitigated by making other technical choices.
Get Some Answers
Assuming that all of the venues you are considering offer similar amenities and dates for your general event plans, below is a partial list of tips and the kinds of questions I would ask when meeting with your venue sales rep:
- Do you have an in-house production department?
- Are they hotel employees or a contracted service provider?
- What services do they provide that are exclusive?
- What services do they provide that are optional?
- What are the rules and regulations that apply to outside production or AV Firms?
- Is the venue a union property?
- Does the hotel restrict me (or my outside production company) in any way from providing my own freelance and/or union labor?
There are definite pros and cons on both sides of the in-house vs. the independent technical production support providers.
It would be self-serving to tell you that we believe you are better off using an independent or outside AV vendor. The truth is, however, that it depends upon your event’s requirements. Choosing the right person to answer all your technical questions is the key to your success.
Kim Davis, national account manager at Lakeshore Audiovisual, can be reached at kdavis (at) lsav.tv.
He and the LSAV team can also be reached via lsav.tv.