I’ve been in this industry for more than 45 years; 38 of those with my own company. In all those years, a month hasn’t gone by that the cost of coffee (and AV and other pricing), and service charges and other F&B pricing, hasn’t been raised, with great frustration expressed by planners about costs. In social media as it did for years in face-to-face conversations, the topic of the cost of coffee, in particular, is raised again and again.
The subject for the August 2019 edition of Friday With Joan took a turn. It was going to focus on pricing for AV and guest room rates, and additional fees, until the suits against Marriott and Hilton cropped up, complicating that discussion. We’ll move that to another month. This month, we’re focusing on F&B—from the points of view of planners, hotels and outside catering companies—in the hope it might move us to some agreement.
Or at least a better understanding of both sides of the F&B discussion.
In addition to those quoted directly, my immense thanks to Reiko Tate, a former meeting planner in Washington, D.C., who now is the creative director and owner of Menu Maker Catering and Events in Nashville, Tennessee. Reiko has been a source of information for me for years and has been quoted in other blog posts here, and especially here.
Her conversations with me about the cost and availability of food and labor; of full-service catering vs. drop-off catering, and the cost of their take-out operation; the timing of the requests and availability of items and personnel, made me rethink all that I knew about off-site catering.
Having recently planned a life celebration using an outside catering company at an off-site venue, I found that the proposal—which once signed would become a contract—was lacking in the details that would ensure all we needed would in fact be provided. In order for any of us to ensure completeness in what we do, we need to ensure all details are spelled out.
Food is a perishable commodity. We need to better understand all that those who cater events go through in order to make our events memorable, affordable and safe. I’ll ask Reiko to respond to the comments here and hope she’ll be able to make the time. Her insights as a planner and now a caterer are invaluable.
Meetings Today's editors and I have edited the comments for clarity and length. If we have misquoted any of those interviewed, we apologize. Note that the opinions expressed are those of the individuals and may not reflect the opinions of their employers or clients.
Planners interviewed:
- Colleen Bailey, Manager, Meeting Services, Food Marketing Institute
- Marguerite Leishman, Manager, Meetings and Events, National Alliance on Mental Illness, mleishman@nami.org
- Kellee O’Reilly, Chief Experience Officer, MonkeyBar Management, kellee@monkeybarmanagement.com
Joan Eisenstodt: Please provide a summation of your career experience and the average number of F&B events (connected to meetings, conventions and/or stand-alone) you plan in any given year.
Colleen Bailey: I have more than 20 years’ experience, starting on hotel supplier side and then moving into the association planner side. Currently, I work on about 15 to 20 F&B events annually. The largest event I worked on was for 1,200 people.
Most of what I do is in hotels and unique venues versus in convention centers.
Marguerite Leishman: I have more than 30 years of experience in the hospitality industry, primarily in the association community. I have planned F&B events for groups of five to 5,000.
Currently, I handle about 20 programs a year, including staff trainings, conferences and the annual convention.
Kellee O’Reilly: I’ve been in the meeting and events industry in some capacity since 1993, first on the staff of a number of national trade organizations. I opened my own firm in 2007.
While most of my work now is in change management/strategic planning, events are still a significant part of our portfolio. We specialize in smaller, high-touch, interactive events mostly for business peer groups and nonprofit leadership teams. We produce at least 200 separate food and beverage events annually, ranging in size from 10 to 1,200 people.
Eisenstodt: When planning F&B in a hotel or using an outside caterer, what are the three most important issues for you? Some examples: Price? Pricing? Service/labor charges? Menu offerings? Service and/or labor itself? Something else?
Bailey:
- Flexibility to work with a trade association that has some sponsors in the food retail arena, in handling donated food items, sampling (no corkage) or establishing corkage in contract for some sessions, and potential recipes to follow.
- Ability to offer sponsor products at meals if the hotel doesn’t normally offer them on their menus.
- Service and labor: I now see more hotels charging not only bartender fees but also server fees for x number for passing hors d’oeuvres.
Leishman:
- Priority one is the price of meals and service charges. You can’t have one without the other.
- Menu selections have become increasingly important, with more requests for healthier options and specific dietary demands.
- Standard prices such as a gallon of coffee, or a continental breakfast, to gauge costs for other meals.
O’Reilly: Most of our clients are price-sensitive, so price is always a consideration.
That said, I am more compelled by how “contemporary” (or not) a menu seems to be—does it feel like it has been refreshed within the past few years to incorporate food trends (e.g., clear gluten-free options, keto-paleo options). I also always look to note fees applicable to small groups (often 25 or fewer by some hotels), and what the total service charge will be.
It has, in some markets, crept up from 18% to 25% in recent years.
Eisenstodt: When budgeting year to year for F&B events, especially those held in conjunction with the same year-to-year meetings, what do you use to guide your process?
Bailey: We base budgeting on the last meeting held in a similar format and location and adjust accordingly to service charges and taxes to their menus.
Leishman: I review budgets and actual expenses from the past two to three years. Was I on target with my predictions? Where did I budget poorly? What lessons did I learn (such as our staff requested big breakfasts at our convention, but no one ate them) that I would not repeat. Were there pop-up meetings not budgeted that I should now include for future meetings?
I meet with any department that will have F&B and discuss their anticipated needs, and encourage them to plan early and realistically.
O’Reilly: There hasn’t been a year in recent memory when F&B hasn’t seen a minimum of a 5% increase, 10% in some places. I think building realistic budgets each year as events move between properties is critical. I had an event that was in Tulsa, Oklahoma, one year and then Newport Beach, California, the next. There is no way they can have the same experience in those two markets without significant budget increases!
Eisenstodt: When working with hotels or outside caterers, what are the top two to three things you wish you had been told in the F&B portion of the proposal about the pricing and conditions?
Bailey: I ask for:
- A complete proposal to include any extraneous items and expectations, such as whether the caterer will remove trash or not, and who will pay for the parking for catering staff if there is a charge for parking. I want to know if there are overtime labor charges and what they will be.
- Whether the caterer automatically plans for vegetarian meals or what I must order in advance.
Leishman:
- When price increases are anticipated, and by how much.
- Will I work directly with staff from the catering department or with a convention service manager?
- Does the hotel work with local suppliers and provide locally sourced food in their outlets and through the catering department?
O’Reilly:
- I absolutely want a link to the current menus embedded within the proposal; too often I have to go searching for those details. [Joan’s note: If booking more than a year out, you may have to print out the menus and attach them to the contract. Menus are updated at least yearly and the links now won’t be available closer to the meeting].
- More recently, I have seen “average” F&B prices referred to within proposals (e.g., “Breakfast starting at $28”), which I find very helpful.
- I have a strong preference for the few properties that make coffee/break packages easier for planners by offering "day packages" that include permanent/regularly replenished breaks (shared or individual), similar to how conference centers provide CMP—complete meeting packages—and day packages.
I appreciate the preferred pricing on the "lunch buffet of the day" approach, which enables the kitchens to prep more effectively in bulk to service multiple small events with the same menu (e.g., by selecting the "Tuesday Taco Salad Bar" or the "Wednesday Pasta Bar" to serve on those days you can save $5 per head).
Generally, this is an area where so much waste and budget expense can occur.
The ability for the property to “systematize” their offer more consistently and save clients money while offering more options for guests (and less time for the planners to make a-la-carte selections) seems to be a win/win.
[Joan’s note: See comments from two NACE members that confirm this thinking]. - And a fourth: It's not specific to only F&B (and not at all to pricing), but with smaller meetings I'm rarely able to conduct an in-person site inspection.
Properties that have photo tours of meeting rooms available embedded within the proposal, which allows me to readily gauge how my event will feel in the space (and where there might be room for F&B), is a great asset.
Eisenstodt: What do you wish most hotels and outside caterers understood about your F&B budgeting and needs?
Bailey: It’s hard to guarantee sometimes seven days in advance what’s required. For example, for a seated VIP dinner, I sometimes don’t know until arriving at the venue. Sometimes we have to pull chairs/table settings to not have the tables look awkward. (Staff eats the left-over meals).
Please don’t refill coffee without asking the onsite group contact. Sometimes we can’t afford to replenish coffee, so if we have a 15-minute break, I prefer the urns to be pulled when the coffee is out vs. the participants thinking there will always be coffee available.
[Joan’s note: See responses from two NACE officers and the impact on perception of who is responsible if food or coffee run out].
Label all menu items on buffets, and include an ingredient list, to ensure those with food allergies are aware of what they are eating.
Leishman: I want to work as a team and want flexibility and creativity in their menu options for my requests. [Joan’s note: See responses from two NACE officers].
O’Reilly: There’s no easy blanket answer to this. I work really hard to ensure that our hotel contact understands our needs. It’s my job to communicate clearly–not assume that the right questions will be asked. Each event is so different; it requires a specific conversation about what matters to that group. Customization, consumption counts, replenishment, budget-sensitivity, food allergies, timing adjustments–everything must be spelled out.
For every event, I’m building a relationship first with my salesperson, then with my CSM, and finally with the banquet captain or server actually executing the event.
Eisenstodt: What did I not ask that you want hotels and caterers to know about how to help you with F&B events?
Bailey: Hotels are now charging re-plating fees for moving non-perishable items from breakfast to a meeting or desserts from lunch to use elsewhere. If this is a new practice, we need to know in advance about what the charges will be.
Leishman: Why does a gallon of coffee cost $150++? And how can I possibly justify that to my boss? [Joan’s note: see NACE officers’ responses and my blog for more on cost of coffee].
O’Reilly: The underlying point [of the information available at the links Kellee sent, accessible at the end of this comment] being essentially that smart pricing is driven first (but not only) by input costs. And in hotel F&B, they are wisely watching all of those input costs skyrocket: labor, insurance, transportation, raw materials, etc. Then, prices are also affected by "what the market will bear" (supply and demand), and finally the added "return on your risk" (how much profit does the business want/need to return to their owners/investors).
For the link for information from Cargill, it turns out the price of tea (or soybeans! or flour!) in China really does affect everything in the global markets, eventually trickling down to the price of muffins or coffee on a hotel BEO somewhere near you.
For more information about the comments from Kellee O’Reilly:
- An Index of Prices Paid by Growers in the Green Industry 2007-2018
- Agriculture Giant Cargill Reviews Business
Related Content From the August 2019 Edition of Friday With Joan
- My Lunch With Tom Sietsema, Washington Post Food Critic
- 2 Food & Beverage Suppliers Share Their Secrets to Savings
- You’re Charging How Much?!: The Case for Smarter F&B Budgeting
- What's Your Take? August 2019 FWJ Poll
Click here to view additional content in the 08.02.19 Friday With Joan newsletter.
