As we try to manage the fallout from the ongoing COVID-19 crisis, we are also focusing on what we can learn from this devastating situation. Though we obviously hope we never have to face another crisis like this, it's always important to be prepared for the unexpected.
One of the biggest take-aways we've had during this time has been the importance of working with trusted partners at every level. Having good relationships with our clients, hotel contacts, independent reps, and airline travel partners is beyond important at a time like this. The people we work with consistently understand that we are a small business trying to navigate a very difficult situation, and that now more than ever, timely payments, clear communication, and honoring of contracts makes all the difference.
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| Photo by Obi Onyeador |
In light of this global health crisis, here are some of the things we would do differently (or at least examine closely/potentially add to) in the contracting stages of a group program:
- While many airlines and travel partners are willing to work with customers, it's important to note that pandemics are typically not covered by the force majeure clauses in most hotel/travel agreements. It's also important to be familiar with the terms of your contract at the time of signing so you know your options. If a party will allow for the addition of epidemic/pandemic language in the force majeure clause, it would obviously be beneficial to do so. If not though, it's crucial to put other safeguards in place to protect you and your client in the event of a crisis. Partial force majeure is another option which would help cover situations when airlift is cancelled from a specific region to your event.
- One way to add some coverage/flexibility is to clearly outline the rescheduling options in the contract. Adding verbiage about a cancellation fee waiver in the case of a complete reschedule (within a certain time frame) helps preserve options for the client in the event of a disaster not covered by force majeure. Ensure your contract mentions that both parties will work together to find an agreed upon alternative date for the program (typically, reschedules within the same calendar year will be honored without issue; if possible, request 16 months so the event can push to the next year).
- As is usually the case, the more communication the better, especially in the case of a constantly evolving situation like Coronavirus. During this unpredictable time, we have taken a very proactive approach so we know what options we have before the client comes to us with questions. As reports have come in over the last few weeks, we have stayed in close touch with the hotels and our third-party flight booking service to find out all options available so we could communicate them clearly to our clients. Keeping those lines of communication open between all involved helps significantly when needing to make quick, ongoing decisions about a program, especially one that's rapidly approaching and impacts so many travelers.
- We are finding it's paying off to be patient and wait for updates. For example, if flights are cancelled by the airline you are more likely to receive a refund than if you cancel them proactively, which usually results in credits or vouchers for future travel. Also, with many of the hotel contracts, if the client cancelled ahead of time they were asked to pay full cancellation fees. But if there is no risk in waiting (ie, no additional cancellation fees), we recommended that our clients wait, in case the options improve. We found that by waiting, some hotels allowed events to be pushed to 2021 and others sadly closed but deposits were refunded.
With a global crisis of this magnitude, there are countless unforeseen obstacles to deal with, but hopefully we can learn something constructive from this difficult time so we are even better prepared going forward.
