Hotels Lose Holiday Parties to Company Cost-Cutting

(MoneyWatch)  At a time when companies are tightening their belts, many are losing their sumptuous holiday parties. Some companies are choosing to host parties on their own grounds, spend the money on a charity or even cancelling the party. Either way, their choices aren't helping local hotels and conference centers.

In Manchester, N.H., the Radisson Hotel will host the same number of parties, but with fewer guests -- a drop of about 10 to 15 percent. Maurine Bowman, director of sales, told the Union-Leader that companies are choosing to go with chicken or buffets rather than the higher-end prime rib. "Some (parties) are not as lavish as they've been in the past," she said.

New York-based Battalia Winston Amrop reported that 37 percent of companies say their holiday office party has been either scaled down or canceled, although 81 percent will still have some kind of party -- the lowest in the data-gathering group's history. According to workplace experts, Challenger, Gray & Christmas Inc., a survey of 100 companies found that 23 aren't having a holiday party this year, compared with 10 percent last year.

In Carson City, Nev., Cindy Perry, director of sales for the Plaza Hotel and Conference Center, said that holiday parties are down. "Some of my clients from last year aren't having parties because they can't afford it."

In Bellevue, Wash., the Meydenbauer Center already scrapped a holiday lunch for 900 people when it received another blow. "We had a holiday party cancel on Saturday night that was huge," Brenda Dotson, the center's sales director, told the Seattle Times. "They had rented our 36,000-square-foot space."

Apparently the cancellations were so rampant in Philadelphia that the Loews Hotel in Center City decided to create its own holiday party and charge $30 to $40 per couple.

While it's understandable to cut down on a holiday party after layoffs, or to save money, many companies choosing to spend the money on charity or cancelling the event could be missing the point. Experts say that workers need that recognition to help boost morale and a cancelled party could signal to employees that financial danger is ahead.

Chad Kaydo, editor-in-chief for BizBash Media, which covers corporate event planners, said that companies have to tread carefully. "In some cases, canceling an event is necessary, but in other cases, it's a missed opportunity to do something nice for employees."

Hotels and other venues also must look at more diverse opportunities. At the Meydenbauer Center, for instance, the canceled holiday party was replaced with a boxing match.

Photo courtesy of the Florida Hotel and Conference Center