One of the most critical factors in determining whether the government market is real business fit for a hotel is contingent on whether there are local government business drivers that exist in that hotel’s competitive set. In the final analysis, local government customers will steer nearly all the government volume that generates into a specific region.
Having a solid understanding of who the local government players are, and further understanding their collective needs are perhaps the most important tactical components of penetrating and properly selling to government clients.
In this age of revenue optimization, one question hotels must consider is whether the prevailing per diem for lodging is acceptable? If the answer is yes, then the hotel is probably a good fit for the government market. If the answer is no, then it is probably not in their best interest to pursue and should not be a key area of focus.
Many hotels have approached me with a common question – is it possible to gain competitive immunity with government customers? Although the answer is no due to monopoly laws passed by Congress, I feel that hotels can successfully position themselves to consistently win in the government market over their competitors.
Regardless of the size of a potential piece of business, it is my belief that it is possible for a sales professional to uneven the playing field with their competitors by having a superior understanding of how the government solicitation process works. This understanding includes a thorough knowledge of how to present and deliver value to government clients. My experience has proven this is usually the primary difference between winning or losing a contract.
When it comes to lodging, government decision makers rarely base their decisions on lowest price. Today, government decision makers base their decisions on both “best value” and “risk assessment.” In simple terms, the government will likely award a piece of business to a contractor that offers them the greatest value at the lowest risk versus a contractor they suspect has a realistic probability of failing to carry out important obligations stated in the contract itself. Although these expectations vary from contract to contract, they are usually specifically noted in either a statement of work (SOW) or in the formal contract itself.
In short, understanding needs, knowing what’s important and delivering a consistent promise is the greatest worth to our most reliable customers.
by Christopher McLaughlin