Destination Management Company Contracts: Best Practices You Need to Know
Despite the COVID-19 pandemic, in-person events have started to make their comeback. Now, planners must deal with a mix of old and new challenges, as it seems there is no shortage of COVID variants, hurricanes and wildfires to keep everyone on their toes. In addition, destination offerings (venues, restaurants, etc.) have changed considerably over the past two years. Partnering with a Destination Management Company (DMC) is more important today than ever before.
As a national events agency that hires DMCs, and which also happens to be a Detroit DMC, Special D Events has a unique perspective. We understand the hesitancy in signing a DMC contract when there is so much uncertainty in the world. But you can feel confident in doing so by following these best practices when considering a DMC partner:
1. Place your trust in DMCs that are certified by the Association of Destination Management Executives International (ADMEI) and request proof of that certification. In order for a DMC to be ADMEI certified, it must prove that it does the following:
a. Provides activities, transportation and at least two of the following: event management, entertainment, program logistics
b. Is a member in either its local Conventions Visitors Bureau, Destination Management Organization, tourism office or chamber of commerce
c. Has a website that accurately defines the DMC services it offers
d. Carries a minimum of $1M or equivalent in general liability insurance
e. Provides the following documentation
i. Business licenses
ii. Liability insurance — certificate of insurance
iii. Four letters of recommendation (two from clients, two from suppliers)
iv. Request for proposal from past 6 months for a program for which the DMC was chosen
v. Proposal responding to the above RFP
2. Request a contract that states all deposits must go into an escrow account. By doing this, everyone involved knows that the money is available, protected and will only be paid out should the agreed-upon terms be met.
3. Request proof that all suppliers the DMC engages are paid in full prior to your event. Vendors and venues are more likely to perform as promised if they have been compensated pre-event.
4. Have a face-to-face conversation with someone on the DMCs leadership team (Zoom is fine). Like many industries, the hospitality sector has taken a big hit since the pandemic. A conversation will uncover steps the DMC has taken to ensure long-term viability.
Despite the challenges, the show must go on. We are here to help if you have any questions.
