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Most of our Government Contracts come to us directly from Government Agencies. Our policy is that we cannot take a block of rooms out of inventory until we have an actual signed contract, purchase order or letter of intent. Most times the contracting process takes so long that we end up waiting months for a definite answer that the group is actually coming.
About six months ago we went ahead and broke our policy for Government groups and took four large bookings without any contract, purchase order or letter of intent. We did this as a courtesy for the different groups because we really wanted their business and we knew that if we waited that the guest rooms would not be available when the contract became approved. So far this year we have gotten stung two times out of all four groups. The two groups decided that they needed additional breakout space but did not communicate with us that if they did not get the additional space that they would go elsewhere. I had offered alternative breakout space to the contact at a location connected to the hotel but within walking distance. She turned it down saying that the group did not want to leave the building. When we approached the Director about the cancellation she loved the idea of the alternative space and wondered why it was never offered to her. The person I had been dealing with never once spoke up about this and completely threw the hotel under the bus.
Just this week we received confirmation that another group is definitely coming to our hotel in April, which is right around the corner. We have been holding this space for the past six months. The problem that we face now is that when they rebook next year, do we stick to our policy and take the chance that the 70 rooms will still be available when the contract is finally awarded or do we make an exception and hold the rooms without any backup.