Question:
Dear Advice Guy,
I was asked to host a high school wrestling awards banquet, which is the kind of thing we often do. The coach who is making the arrangements mentioned that he is getting quotes from other venues as well and that some restaurants have folded in additional incentives like feeding him and his family for free at other times. Is this the kind of thing I should be thinking about?
– Manager
Answer:
Absolutely not. Kickbacks, providing a bribe or other incentive to the individual who secures you a contract, is unethical. Given that this high school coach is likely representing a public institution and maybe using tax-levy funding, it may also have serious legal implications. If you are being shaken down for perks unrelated to the goods and services you are providing, I’d recommend respectfully declining this opportunity.
That said, there are some much softer business-development incentives that are both ethical and smart tactics to secure a catering contract. Bringing the coach and some key decision makers in for a tasting of your offerings is different from him eating for free after the fact. Similarly, giving some VIP treatment to a regular guest who has sent a big party your way, and continues to support you, is different than offering a full comp in exchange for a public contract.
The line between business-development incentive and kickback can be a fine one. To be sure you are on the right side of it, consult with your attorney and local restaurant association.
More on securing catering contracts here.