When 1 is a group and other fairy tales

A journalist wrote to me recently asking if I’d be interested to give some negotiating tips for a magazine article. I probably shouldn’t leak anything here before I know whether my submission was accepted but my gut feeling is that it wasn’t. I submitted rather a chaotic rant of a summary which isn’t going to make it into the pages of Directors Monthly or whatever it was.

There seems to be a big gulf between the reasonable negotiating tactics in ‘normal’ business and the brutal wear-the-opposition-down practises sometimes employed by large companies. No doubt the former is much more palatable but I still feel strangely emboldened and humbled by the fact that I learnt to negotiate in BigCorp. It has given me both the confidence to know I can ask for anything and most likely get it and the humility to not want to.

I’d forgotten a lot of the strategy until I recalled it for this journalistic piece (which will never see the light of day). I’d remembered the silly sneaky parts like my cracking open pistachio nuts whilst the hotelier was talking to indicate my utter disregard for anything they might have to say. And my looking out the window like some forlorn B-movie actress when they were trying to point out the finer points of their establishment. But I’d forgotten there was a longer term strategy of getting the hotel to pay us rather than us pay them.

If that sounds absurd – agreed it does – so does group minimum 1 and we managed to negotiate that all over the place. I’ll try and explain.

Hotels always used to offer us discounted rates for sales of groups travellers rather than individuals. That’s standard wholesale economics if you forget the fact that we were contracting as wholesalers already. In effect then, we were asking for a discount on our wholesale rates if we sold wholesale wholesale. Don’t think about it – it’s nonsense. But we sold the idea.

We chipped away at the buying price in lots of different ways. We got breakfast included in our contracted rate (‘it can’t cost you more than a Euro to fry a couple of eggs and slice some holey Eurocheese’), lowered rates for those dismally quiet Monday nights and, of course, asked for some introductory discounts for the up and coming lucrative (sic) Japanese market.

But the prize, the crown on your crimson demonic negotiator’s head, was Group Minimum One. Or GM1, in the game.

It’s so absurd, I can only try and explain. We were telling hotels that the discount we needed on our wholesale rates for groups of travellers should apply even where the group was just 1 person. That’s 1 traveller in the group. There’s no other way to say it.

And here’s the strategy. Introduce the idea over time where it all feels comfortably remote and then extend and expand it so that it encompasses everything. In practise, that means start by explaining that the Japanese are very seasoned group travellers. They’ve been to Europe many times and they’re travelling in smaller and smaller groups. Even down to just a couple. It’s called – ‘Go-as-you-please’. Bang – group minimum 2 in Japan.

Then the Koreans. Totally new untapped market. Very exciting and it seems they already travel like the Japanese in very small groups. Don’t talk about eating dog, they don’t want that in their hotel, but do talk about ‘Tiger Economies’. All going well, the hoteliers should either be glazing over at this stage or slavering over the thought of their lobbies being overrun by tidy little Korean folk with their big fuck-off cameras and no clue about the conversion rate to Euros.

It’s not easy to get to GM1 from GM2 so if you’re feint of heart or just plain lost already it’s time to leave. If you’re still with the programme and you promise never to prostrate yourself to these shameful levels, here’s how to do it.

A lot of hoteliers are already a bit twitchy about GM2 but you must hold your nerve. By this point you need, even if only briefly, to believe what you’re saying. Any hint of a smirk and you’ll blow your cover.

Once you’ve looked completely underwhelmed by the hotel’s new fitness facilities and you’ve accumulated a small mole-hill’s worth of pistachio shells over the proud General Managers new desk, you hit them with this: the Japanese, it seems, have tightened up on their consumer law. Very boring. The authorities out there feel it is wrong that someone should pay for their trip and have it cancelled just because no-one else joins the group so it is now illegal for Japanese travel agencies to cancel a group even if they’ve sold just one place on it. So you, the wholesaler, have to agree not to charge travel agents more if they only bring you one person in a group tour and, if the hotel wants in on the much more common and profitable Japanese large group action, they need to offer GM1.

It doesn’t work every time but if you’re good and the economy is wavering or on the decline you’ve got a fifty fifty chance. Next time you visit, you tell them the Koreans are doing the same and the time after that it’s gone Pan-Asian. You’re now one step away from GM1 worldwide.

If you’re feeling a bit confused and even a bit sullied at this point you’ve understood perfectly. It’s a giant, deliberately bewildering, scam.

As I’ve alluded to before, I’m not proud of any of this and I’m convinced that much poker faced lying led to my eventual nervous breakdown. I was only mentioning this in my summary to the journalist because I wanted to say what not to do in negotiation but I’m not sure that point came across. I hope you got it.

Next week: How to deflower a virgin nun and have her forgiveness within 17 minutes.

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One Response to “When 1 is a group and other fairy tales”

  1. Matt says:

    Virgin Nuns?

    That Branson’s thought of everything….

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