Brandt Krueger, meeting & event technology consultant, and ELI instructor, shares strategic insight from the field on how to negotiate your next AV contract.
“It was the best of times, it was the worst of times…”
Not that long ago, in a galaxy remarkably like this one, I was working on an incentive event for a client. The location was beautiful, the evening events and activities for the guests had been in the planning stages for months, and it was shaping up to be a fantastic event for everyone involved. The in-house AV company was energetic and responsive. In fact, we’d used them for an event at the same location a year earlier, and we were looking forward to working with them again.
It was simple. We just needed a couple of screens and projectors and a small sound system. The program was mainly an incentive trip, so the meeting room wasn’t the primary focus of the event. So you can imagine our surprise when we got the bid back from the in-house and discovered it was just under $15,000. That’s right, $15k for a couple of screens, projectors, and small sound system.
“…it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity,…”
In another place, at another time, we were getting bids on the equipment for a different event, this one a multi-day conference. We’d used the same AV company for the last three years, and in fact, this vendor was my hands-down favorite to work with in that particular city. They were professional and meticulous during the day, yet fun to hang out with at the end of the night. Any time we worked with them we were guaranteed a near-perfect to perfect show, and if I’d had my way at the time, we would have used them for every event I was on. Plus, since they’d worked on the show for the last three years, they knew the program inside and out, and the whole thing was a well-oiled machine.
When the bids came back on that conference, they were almost $20,000 higher than the next closest bid- far from chump change, and hard to justify to the end client based on likability and experience alone. The next closest bid happened to come from the in-house AV company in the venue, which was eager to set up a multi-year contract. We hadn’t used them before, though, and were nervous about moving to a brand new supplier.
In both cases we approached the client with the options before moving ahead. We were informed by the incentive client that there was a clause in their contract from the venue stating that they had to use the in-house AV or they’d be assessed a fee. We usually recommended negotiating that clause away, or down, but they hadn’t. They felt helpless and definitely had a “What can you do?” attitude. With their permission, however, we made a phone call.
In the instance of the in-house AV quote, we contacted a local AV company that was just up the road, and got a quote from them. The total for all the gear, including the fee to be charged by the venue, was $3000. There were going to be some minor inconveniences regarding setup times, and the client did prefer to have the AV on the master account, so we approached the in-house to see if they’d be willing to at least meet us somewhere in the middle. Nope. $15k all day, and they weren’t going to budge.
Similarly, we called my favorite AV company and laid out the situation. It was a pretty frank and honest call, basically saying, “Look, we really do want to use you guys, but we can’t justify $20,000 higher to our client. They know you know this show, and so do we, but the in-house is aggressively targeting this group.” They went away, crunched the numbers again, cut some labor, parts of our team agreed to take over some of their responsibilities, and in the end, knocked over $10,000 from the bid.
So what’s the moral of these stories?
- Always, always, always get a competitive bid when ordering AV or event technology. There’s plenty of groups out there that always use the in-house, no matter what. And it’s easy to understand why- they’re right there, on site, if you need anything, and they know the venue inside and out. At the end of the event, everything just goes on the master venue bill, and it’s all incredibly convenient. Sure, sometimes it’s a little (or a lot) more expensive, but hey, that’s why candy bars cost $8 in the lobby store – because it’s convenient.
- Likewise, in my experience, event people are frequently incredibly loyal. Once they find a vendor that they like, they stick with them, and only if their quality slips significantly, or their costs skyrocket, do they look for a competitive bid.
Let me say it again, though: you should always get a competitive bid. While in the first story the in-house refused to budge on price, a lot of them will negotiate if they think they have a shot at the business. It might still be more expensive then an outside vendor, but it might be close enough that you’re willing to make that trade-off for convenience. And, as in the case of my example, you might be able to save a ton of money by using an outside AV company, even if there is a fee associated with doing so.
The same goes for “your favorite AV company.” They may know your show inside and out, and may know how to hold their tequila afterward, but how much more are you willing to pay for that? You might need to try someone else from time to time, if only to realize how green the grass really was on their side. One thing is for sure, if you don’t get a competitive bid, you’ll never know.
Want to learn more about event tech and AV? Take our 5-week Technical Meeting & Event Production online course with Brandt Krueger!