Food Fight

Food and beverage costs have skyrocketed over the past two years. Here are some suggestions from planners and industry executives on what you can do to get a bigger bang for your shrinking buck.

By Michael Bassett

When Melissa Bohlmann plans a conference and looks at what her food and beverage costs are going to be, it’s almost enough to take her breath away.

“It’s becoming a real strain,” says Bohlmann, convention services manager, Lutheran Hour Ministries, St. Louis. “When I take a look at our annual meeting history, food costs have really gone up over the past two years. And I’m going forward with booking that meeting through 2012, and those costs are going to keep going up.”

According to the National Restaurant Association, wholesale food prices have increased 8.7 percent this year through August. This is on top of a 7.6 percent increase in 2007. So, when one considers that prices rose just a measly .7 of 1 percent in 2006, observers can understand why planners like Bohlmann have let out a few gasps when they’ve seen their F&B bills over the past two years.

Why So High?

The simple answer is that the price of commodities has risen sharply in the last two years. For example, the runup in the cost of oil has led to an increased global demand for biofuels. Consequently, the price of corn, soybeans, and wheat has more than doubled in the past two years, leading food companies to raise prices on everything from cereal to ketchup.

This increase in the price of grains has contributed to an increase in meat prices, as farmers are forced to pay more for feed for their livestock. According to the National Restaurant Association, the price of beef and veal has increased by 19 percent this year. All of this is not expected to change over the next year. The U.S. Department of Agriculture expects food costs to increase by as much as 5 percent in 2009.

Beverage costs have been on the rise as well. According to the Boston-based pricing intelligence company Intellaprice LLC, the price of bar beverages increased by 5 percent this year over 2007. The company says price increases can be found across the board. For example, soft drinks were, on average, $.13 more expensive.

Negotiating Strategies

For Charles Melear, conference planners, United Church of God, Fort Collins, Colorado, “increasing food costs are a budget consideration more than in previous years.” So he is very proactive in negotiating food and beverage.

“I create the menu items I desire and present it to the chef or salesperson,” Melear says. “Then I ask if that specific meal can be done at a price [including tax and gratuity] that I suggest or recommend. Usually they come in very close to what I ask, and it is almost always less expensive than their listed banquet menus.”

Giovanna Brandi, senior account executive, Marriott, Renaissance, Ritz-Carlton, and JW Hotels & Resorts, agrees, and says that when it comes to the faith-based market, “I’ve never worked with a group that paid regular rates off the banquet menu. I developed a set of menus years ago that I had pre-approved by the hotels in my region for use during value dates. [Those menus] were created with client and hotel feedback, and the inclusive pricing varies depending on hotel demand during the requested meeting dates. Hotels are happy to work with client food and beverage budgets as long as they are realistic.

“What I’ve noticed,” adds Brandi, “is that it’s taking a lot longer these days to actually sign contracts—it seems planners are really going through everything with a fine-toothed comb.”

Chrysta Bollinger, director, member services & communication, Catholic Campus Ministry Association, Cincinnati, plans an annual convention for 350 people every two years. “At least one dinner has to be sitdown and fancy,” she says. So she’s willing to look at alternatives—menu items that allow her to stay within a budgeted amount but maintain the high quality of a grand banquet.

“So I’ll sit down and start creating a budget,” Bollinger says. “I’ll start with a wish list—everything I want to have. I’ll see what money we have in sponsorships and see how realistic that wish list is. If it’s not, then we start paring it down.” Bollinger works with a meeting-management company that helps her to negotiate everything, including site selection, contracts, and food and beverage.

While sales departments are usually the first point of contact when negotiating F&B details with venues, Janet Pickover, CMP, director, Site Inspections Plus, Princeton, New Jersey, maintains that any meeting planner who wants “to get the biggest bang for the buck,” should always talk to the chef. “And don’t let any salesperson say you can’t talk to the chef,” she says.

“It usually depends on the planner,” says Jami Leveen, director of marketing, Aramark Convention Centers and Cultural Attractions. “Some want to have direct access to the chef, although the standard practice is that once the meeting is booked, the salesperson works with the meeting planners. If it’s a large event involving a lot of menu planning, the planner will certainly work with the culinary team, which will include the executive chef.”

Setting New Trends

According to an Aramark report on culinary trends at convention centers, Aramark chefs are going to be looking for ways to give a gourmet treatment to “otherwise ordinary” menu items.

For example, Palm Beach Country Convention Center Executive Chef Michael Russell is giving chicken new looks by roasting it with prunes, kalamata olives, and lemon roasted garlic jus, or sautéed with caramelized pears, figs, dates, gorgonzola, and Frangelico syrup.

“Guests are looking for a ‘new gourmet’ that is more aligned with their budget expectations,” Russell says in the report. “To meet their needs, we’re mixing things up and taking a new approach to spice up ingredients that might not be top of mind.”

According to Leveen, convention centers, responding to meeting planners’ requests, are beginning to offer more retail dining choices, to give planners alternatives to traditional catered events.
Bohlmann is planning something different for her annual convention next year in Greensboro, North Carolina. Concerned about costs and the fact that the numbers for certain meals, particularly breakfasts, have been down, she’s putting together a menu of meal packages.

“It will lower costs,” Bohlmann explains, “and probably guarantee the hotel and convention center better numbers.”

In the end, says Pickover, cutting costs or choosing trendy budget-conscious menus won’t help if the planner “doesn’t know the [food and beverage] rules of the road.

“You can get a terrific price,” says Pickover, “but if the event is poorly planned, and your attendees have no time to eat, then it’s all just a waste of money.”