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Year after year

Features, Management | October 1, 2014 | By:

Olympic Tent’s president Scott Sutherland and vice president
Darrel Brown weigh in on how to get and manage
multiyear event contracts.

Relationships take work but, with a little thoughtful effort,
can reap great rewards. And what is a multiyear contract
but a professional relationship between businesses? From
building your company’s reputation to attract new clients,
to knowing your company’s abilities, to writing the contract and embracing change—managing multiyear contracts
can be made easier by listening to the voice of experience. Combined,
Scott Sutherland and Darrel Brown have 35 years on the sales side and
57 with the business of working with multiyear contracts. Here, they
answer a few questions about how to approach those ongoing contracts—based on their years of experience.

Q: What advice do you have for others trying to land new
multiyear contracts?

A: We find that a strong marketing effort produces the best results. This may sound like a pat answer, but it is harder to accomplish in today’s environment than one might envision. We have had great success by improving search results on the Internet, and we rely on the reputation we’ve built in the market over nearly 80 years. We have a tremendous network for referrals and we make the most of that. To us, marketing is much more than contacting customers through traditional methods. Building a reputation for a high quality product with fair pricing and then delivering on time, every time, leads to customer loyalty and many strong referrals. This is, by far, the highest percentage of our business. Further, having the willingness to do the things that others shy away from builds our reputation as well. Being able to meet a client’s special needs creates a bond and a trust level that will carry the contract forward for many years.

Q: How do multiyear contracts affect working with code
officials and pulling permits?

Creating a permit package for submittal can be time consuming and the time spent dealing with code officials is a cost that’s difficult to recover. Multiyear contracts can often reduce the amount of time needed to jump through numerous hoops because the process is more of an update than starting from scratch.

Q: What are the advantages and disadvantages of signing a
multiyear contract?

The advantages far exceed the disadvantages if you’ve properly analyzed the contract from the beginning. Planning for growth is much easier than reacting to it, and having a book of annual business allows for knowing so many important details in advance. The basic costs of selling and organizing a project becomes lower after the first year, and the staff can then focus more on new business. Staffing for an event, having the right inventory and projecting cash flow are just three examples.

Q: How do you handle multiyear events that grow beyond what you can provide?

It’s very important to build strong relationships with certain competitors that allow for subrenting and partnering on events. Ideally, you want to work with one that is not typically competing with you directly and carries the same brand of equipment.

Q: What needs to be considered before signing a multiyear
contract with a client?

You need to examine the project carefully with an eye on your existing inventory and the timing of the event. It’s important to consider how well the event suits the skill set of your staff. We also like to study the organization that’s putting on the event to make sure they are capable of paying the bill and that their staff has the skills to make the project go smoothly. We have had to “fire” difficult clients in the past, which is something we want to avoid. A little research at the beginning can help prevent a very uncomfortable situation down the road.

Q: What should be included in the contract?

We consider our professional team to be a critical element to our success. Every company needs a very good attorney to guide you through the legal aspects of a contract, as well as a great relationship with your bank and an excellent accounting firm. The specific contract language that works well has a balance that’s fair to both sides and clearly encompasses the potential issues that may arise. We are very detailed with our contracts, especially regarding the issues that can sometimes be overlooked, such as the cost of adding something the day before the event versus adding it well ahead of the event.

Q: What about special requirements and changes from year to year?

The key is to build an internal culture that has a positive approach to every request, no matter how difficult. Staff members do not fit in here if they fail to understand the satisfaction that comes with finding solutions to difficult challenges. For example, one of the challenging requests can involve providing structural engineering for a heavy snow load requirement. It’s important to qualify the client’s budget once this request has been made because the cost of the tent will rise dramatically. Clients with new events frequently make numerous changes after the first year of
an event, but those changes diminish to minor tweaks as the event matures.

Q: Do you have any additional
tips to working with clients year after year?

Don’t be afraid to “fire” a difficult client, and make sure to reward good clients with spectacular customer service every year. Clear communication and mutual understanding of how to partner effectively usually lead to an event that’s successful for everyone.

Olympic Tent in Tacoma, Wash., is a leading manufacturer and supplier in the party tent and special event industry.

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