Hotel rooms are just like any other commodity and obey the laws of supply and demand. If you take some time to plan and research where you want to stay you can pretty much negotiate a far better rate than most folks pay for their hotel room. If you can be flexible about where to stay, and when to stay, you can save even more money. First, a little inside information on how hotels make their money from Karen, a former hotel manager:
“Most hotels have tiered pricing, starting with what they call a “rack rate” that is a best scenario price for any room. This is the rate most people get quoted when they just call off the street. It is also the rate that gets charged when the hotel is full up (“booked”) and they know they can get it.
“For example, the rack rate at the Radisson I used to work at was $125 for a double king. From that rack rate, the next tier of pricing is set. This is usually called a “corporate rate”, although the same percentage discount may apply to AARP, AAA, some travel agency bookings, etc. It’s usually around 12 – 15% less than the rack rate. Our 1st level discount was $95 for the same double king. The next tier of pricing usually applies to various corporate accounts (all IBM employees, all Tourism Board employees or all Delta employees, etc.) that’s another 10% off. This rate is based on a contract with the various companies that assures the hotel a certain number of occupied rooms per year (otherwise known as “room nights”). If at the end of a year the company has not used that quota of “room nights”, they are likely to lose their discount status. Again, ours ran around $79 for the double king.
“The final tier of pricing is the “specialty” tier, also called the “convention rate”. This is reserved for things like large parties where a large number of rooms are guaranteed and will be paid for if used or not, employee discounts, etc. This can go as low as 50% of the rate – or lower. But this is a rate that will be hard to get unless you are guaranteeing to occupy 50% of the hotel or more and are willing to pay for the unused rooms anyway.
So the two things that are going to influence your rate are (1) tiers of pricing, (2) number of guests in a room. Usually when you ask for a special rate for a group you’re going to get either the 1st level or the 2nd level depending on the # of rooms you’re willing to guarantee (percentage wise to the total occupancy of the hotel) and/or the number of other facilities you’ll be taking advantage of. For example if you’re going to have your reception at the hotel and spend money with them for food and beverage, then you ought to be able to negotiate a better rate on the rooms.
“Also remember that a lot of hotel pricing also depends on the time of the year. Spring and Fall are big conference and convention times but summer is slow in the tropics, especially the top Caribbean, Central and South America travel destinations. Winter and holidays are very busy as many North Americans are fleeing the cold. So if you schedule your event for an off time, you’re going to have a bit more leverage in negotiating rates. Remember that the object of the hotel is to have maximum occupancy at a maximum rate. If there’s no one in they’ll be more willing to offer you a nearly break even rate than to see the rooms sit empty.”
How To Get The Best Rates on Hotel Rooms
Here’s how to make sure you get the best discount you can. First of all, call around to the hotels you’re interested in, ask for the reservations desk and find out what their “rack” or normal, everyday rate is. Ask if they offer a corporate discount. Make note of these amounts. These will be your starting points for negotiation.
Now, call back to these hotels and ask to talk to the sales department. Do not negotiate these rates with reservations or with the front desk. If the hotel isn’t big enough to have a separate sales department, then talk to the front office manager or the General Manager (GM). In a larger hotel the reservations department is not authorized to set custom rates – sales is.
When you talk to the sales office, be as exact as you can in your figures. Let them know how many rooms you expect to need for how many nights. For example, Aunt Sally and Uncle John will come in Thursday and stay thru Sunday. Aunt Margaret can’t get here until Friday night, so will only need her room for two nights. It helps to kind of plan this out, to be aware of the number of rooms you’ll really need. Obviously you can’t be exact, but the closer you are, the better. Your final result should read something like: Fri night 3 doubles and 5 singles, Sat night 12 doubles and 14 singles, Sun night 1 double and 3 singles. That way the hotel knows what rooms to reserve on what day.
Then begin to negotiate the rate with the sales person. Because you’ve got the rack and corporate rates in mind, you have a starting point from which to bargain. If they won’t go lower than the corporate rate, then move on to another hotel. By the same token, unless you’re planning to rent 1/2 of the hotel, don’t expect to get 50% off. For example, if their rack rate is $119.00, and their corporate rate is $99.00, then you should expect an offer anywhere between $79 – $89. Keep in mind that if your group visit or wedding is during a busy “hotel time” (conventions, symposiums, etc.) there is less room to negotiate on the rates. Of course the more rooms you rent, the lower the rate.
Also remember that most hotels quote the rate for a single (1 occupant) room. One item that you might work into your negotiation is that your family will pay the single room rate, even if there are more people in the room. Keep in mind that if you negotiate this as part of your deal, most hotels are not allowed more than 4 people (adults) in a room because of fire code laws.
Once you’ve nailed down a rate and agreed to go with a certain hotel, the hotel will assign you either a group name, a confirmation number, or both. Most hotels won’t require you to put money down to get the rate, but they will have a deadline past which the rate you have contracted for will expire. It is very important for you and your families to be aware of that date. Usually it is 3-5 days before the actual rentals. Again, if your family group or wedding is during a busy hotel time, it may be 10 or even 15 days in advance.
Also make sure everyone knows the confirmation number or group name that they should be using and emphasize to them that they need to use this information at the beginning of their reservation. Again, it’s no end frustrating (to the reservationist and to the guest) to take an entire reservation only to have to go and re-do it because the guest failed to mention a special rate. Some people will give all the information EXCEPT the name of the group or wedding party. Then when the clerk mentions the room rate they go ballistic because they’re with “such and such party” and should get $$$ rate. Of course the clerk can’t read their minds, but people tend to forget that.