I recently spoke with a mom who was so pleased with herself for negotiating down her hotel’s food and beverage minimum. I didn’t want to burst her bubble, but I was concerned she didn’t really understand what she had negotiated. Sadly, I was right. I want to help you avoid making the same mistake!
So what is a food and beverage (f&b) minimum?
A food and beverage minimum is the amount you are required to spend on food and beverage to use a space. It rarely includes taxes, fees or gratuities. An f&b minimum often takes the place of a room rental fee or waives a room rental fee if you hit a certain number.
Why Is a food and beverage minimum important?
Where the mom got confused is that the actual amount of the minimum is not as relevant as how much the food on the menu costs. For instance, if you are able to negotiate a $7,500 food and beverage minimum for 100 people, but the cost for open bar and the type of plated meal you want will actually be $100 per person, having a low minimum doesn’t make a difference. In this scenario, you’re going to spend $10,000 (before taxes and fees) regardless of the minimum.
Having a high minimum and a low number of guests will ensure that they will have an incredibly nice meal unless you want to pay for food not consumed. What that means is, you have to pay the minimum. If you’re going to pay that amount regardless, you might as well have great food and beverage for your guests and get as close to the minimum as possible. If you don’t spend to the minimum, any leftover funds will be charged as a room rental fee. You will always pay the minimum!
More about minimums
Be sure to check what is included with the food and beverage minimum or a room rental fee. Does it include tables, chairs, linens, china, silverware, glassware…? Before you sign on the dotted line, also check to see prices on a menu or better yet, have them put together a sample menu for you. That will give you the best sense of how much the type of meal you’re looking for will cost and if you can hit the minimum.
There is a wide range of what food and beverage minimums can be. I’ve seen everything from $7,500 for a very suburban hotel property on an off-peak Saturday afternoon to $50,000 for a high-end hotel property on a Saturday night at a busy time of year.
Minimums are most common at hotels, banquet halls, restaurants or other venues with in-house catering. If you bring in your own caterer, you most likely won’t have a minimum at all.
So be sure to check not only what the minimum is, but how much the food on the menu costs. Those two factors will determine how much you’ll spend on food and beverage.