Mr. Manderfeld

Sales & Marketing

It's RFP Season: Are you ready? Twelve ways to be sure

By John Manderfeld, President, Marin Management Inc.

Effectively managing requests for proposals (RFPs) is an important process that can get fumbled by even the most capable hotel general managers and sales departments. Since this time of year is "RFP season", now is a good time to review your RFP procedures. Of course, you should be receiving and responding to RFPs throughout the year-but because many travel management organizations plan on a calendar-year schedule, you will receive most RFPs for the upcoming year during July through September.

Travel managers have been using RFPs for years for selecting hotels for group business and volume transient accounts. Ten years ago, they mailed or faxed long forms to be completed and returned. Now, most RFPs are sent by e-mail or posted on RFP Web-sites. RFPs for group travel are sent year-round; and the volume-transient RFPs are usually done once a year.

If your hotel wants business in the group, corporate transient, government or incentive segments, you need to be actively engaged in the RFP process. Here are 12 ways to be sure that you are:

1. Do more than depend on the national sales team. If you are a franchised or other brand-affiliated hotel, don't assume that the franchiser or central sales office will assure that you get all of the RFPs that you should. National sales offices are good at getting RFPs for national and international accounts, but you likely have many large regional, state and local prospects that use an RFP process for their bulk travel management. These prospects may be entirely off the radar screen of your national sales office.

2. Work effectively with the national sales offices. If you have national sales representation, work closely with them on the RFP processes. Often national sales offices screen RFPs and selectively refer them to only those hotels that they determine should receive them. For example, they may not send a group RFP for 250 rooms to your 200 room hotel because they don't realize that you could share the event with a next-door hotel. Or the national sales office may have internal reasons for preferring to refer business to some hotels and not others.

Be in regular contact with all of your national sales representatives to assure fair and prompt deliveries the RFPs suitable for your hotel. Ask for lists of RFPs that they receive for your location and for your type of hotel in other locations. And fully document those communications for future reference by management and other members of your sales team.

3. Commit the time. To start, conduct an RFP planning meeting to review all of your procedures. I recommend doing this no less than annually, usually in July. During RFP season, you may need to dedicate one person to full-time reviewing and responding to RFPs. Whether full-time or part-time, give a thorough orientation to those receiving and replying to RFPs and immediately review their work. Also, determine who approves RFPs before transmission and how you are going to record RFP approvals.

4. Work within the system. For travel managers, the RFP process is designed to minimize their time talking with individual hotels. Don't call the company to make a sales pitch or negotiate rates. Respond to an RFP by accurately and thoroughly answering every question-and respond on time. If you have questions, try to get them answered by someone other than the decision-maker. It is good etiquette, however, to call or e-mail for a confirmation that your RFP response has been received. While doing so, check to determine if the recipient has any questions or needs any clarifications.

5. Know your competitors' big players. Simple observation and a few telephone calls can teach you lot about your competitors' big accounts-and big accounts usually mean RFPs. A more accurate method is a subscription to TravelClick's Hotelligence reports (www.travelclick.net/market-intelligence-reports/hotelligence) to learn about your competitors' business from GDS channels and GDS-powered Internet sites.

6. Use a trace system. Record the RFPs received and your response in a detailed format. Too often I hear of a hotel that received a company's RFP one year and not the next-and took no note of the omission. Just like the hotel business, your clients and prospects have employee turnover. When travel managers leave their companies, their replacements may be less familiar with your hotel and may omit sending you RFPs.

Use your contact-management software to trace every organization that has ever sent your hotel an RFP to assure that you call them when the next one is due. For example, if you received an RFP on September 20th last year, call on September 5th this year to make sure you are still on the organization's RFP distribution list. If you were not on last year's distribution list, that is all the more reason to call. I also recommend that you keep a spreadsheet listing the status, rates quotes, client response, etc. of every actual and potential RFP for your hotel.

7. Share information. If you are a part a group of hotels, make it routine to send along all of the RFPs that you received to your sister hotels. Whether or note a group or volume account is right for your hotel, it may be perfect for one or more of your affiliated hotels. More important to you, make sure that your sister hotels are regularly sending you their RFPs.

8. Always respond. Never assume that your hotel isn't right for a prospective client or that your rates will be too high. One director of sales told me that she never replied to one huge, well-known company's RFPs because, "We never get the business. Our rates are too high." By preparing a carefully constructed response, we were able to gain a big percentage of that company's business from our hotel's competitors.

I have also heard, "We already get their business, so why should I reply?" I once heard this from a hotel general manager getting about 500 room nights annually from a major local company. He didn't realize that the company was putting more than 7,000 room nights annually at his competitors. Again, a carefully planned reply can substantially increase your production from such clients.

Consider that although you may not have gotten business from a demand generator in the past, you don't know that organization didn't recently have a problem at the hotel that did get the business. So, always respond.

9. Know and work with the travel consortia. A travel consortium is a group of travel agencies that combine to improve their marketing and services to their customers, which are often corporations and government organizations with large travel budgets. Consortia manage a significant percentage of the potential room nights for our industry and are a source of many RFPs. Some require fees for participation, but these fees can be a great investment for achieving greater market share. Here is a list of some of the larger travel-management consortia:

You will need to establish policies for rate quotations and other conditions for each consortium, including commissions, fees, reservation procedures, cancellation policies and room availability. And don't forget to find out which consortia are working with your direct competitors.

10. Consider the Web-based RFP services. RFP Express (www.rfpexpress.com) and Lanyon (www.lanyon.com) are two of the most active sites for posting and viewing hotel RFPs. They serve tens of thousands of hotels. On these sites you can build your hotel's custom response template, which will save you time in replying to RFPs. If your hotel is not using Web-based RFP services, it may be time to take a second look.

11. Track the results. Track what each RFP-generated group and volume account generated for your hotel by month. Doing so will reveal production changes that may affect your future sales management and rate quotes for each client.

12. Have a fall-back plan. If you don't get the business, don't give up. Treat it as you would for other lost business. Try to find out why you did not get the business. Was it the rate, location or hotel features? Ask if you can resubmit your response; and ask how you can do better on the next RFP. Learn from each failed effort.

So, are you ready for RFP season? With your commitment of a little more time and planning of the RFP process, you can make next year's revenue the best ever for your hotel.

John Manderfeld is president and founder of Marin Management, Inc., a hotel and restaurant management and sales-support company formed in 1990 and now operating more than 25 hotels. Marin Management, Inc. is based in Sausalito, California. He has served as president of the California Lodging Industry Association and currently serves on its board of directors. He is a frequent public speaker on hotel sales. Mr. Manderfeld can be contacted at 415-331-1061 or jmanderfeld@hotelpros.biz Extended Bio...

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