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Comment by dpiers | Hacker News Reader

I highly recommend against doing this if you work at any sort of real company. Negotiating trips/dinners/tickets in a contract means there was extra wiggle room and you chose free stuff over getting the best deal for the company. There's a fine line between a business courtesy and a kickback, and you don't want to end up in a situation where someone is questioning if you crossed that line.

The benefit they listed - building the relationship with the vendor - can be valid, but should/could exist as a regularly scheduled dinner that is expensed through normal policies.

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I can confirm that. A deal like this would get me fired immediately as an ethics violation (I work in financial services). Instead of the dinner, they probably could've negotiated a lower fee which in turn would be beneficial for both clients and the company.

Instead of the dinner, they probably could've negotiated a lower fee which in turn would be beneficial for both clients and the company.

TFA said they were at an impasse on the fee issue. This is just one way of breaking the deadlock. If anybody is worried about ethics issues just change it so that the dinner is Dutch. The point is about A. moving forward, and B. having those meetings - not the couple of hundred dollars spent on the meal itself.

Neither side was willing to shoulder the fees. Eventually one side did, but threw this in to mitigate any ill feelings as a result of the negotiation and contract terms. This isn't instead of a fee split, this is Hootsuite blinking first but throwing in an additional term meant to be fun and healthy to the relationship. A $450 dinner every $100k in revenue is de minimis (or whatever is below that, I slept through law school latin) and to me was a great solution to the relationship aspect.

This is neither a business courtesy nor a kickback. It's a negotiated term in the contract.

$450 is not a de minimus expense on $100k revenue. Keep in mind that they are negotiating the 2 percent credit card fee. $450 is a significant fraction of that $2,000.

It is less than half a percent of the $100k and quite honestly an expense the vendor would likely spend anyway on business development to maintain this relationship anyway. Hootsuite feels like they're getting something, the vendor is agreeing to something they'd probably pick up the tab for anyway, and both sides feel like they gained something.

The credit card fees really don't enter the frame for me. Hootsuite blinked and conceded that term.

Hootsuite could have used taking on the CC fees as leverage for obtaining a concession on a different point. Instead they negotiated a clause that benefits individuals, and not the company.

If I were an investor in a company and they accepted suboptimal contract terms because of terms that benefited individuals and not the company, I'd be unhappy. If they promoted it as a best practice, I'd be livid.

We can only go by what's written in the article, but it sounds like the CC fee was the only item at issue. Hootsuite was willing to budge on it and essentially had the vendor put business development activities into the contract. I agree that it does start to look like personal services, and I'd not be happy about it if it were something larger. But the vendor was buying dinner every once in a while anyway - why do you think they agreed to it? And while Hootsuite maybe could have leveraged that term for something else in the contract, it sounds like they're very happy with their end of this. It'd be one thing if the Vendor was promoting this, but it's the party that conceded the larger term thinking it beneficial. It's certainly a YMMV situation.

And this is why established companies with unimaginative salary men who can only read the paperwork fail and nimble smaller companies can over take them even if the established companies have the market share.

Guess it's like catch up in computer games.

Make the dinner for any representative of the company, not a named individual. Thus the company receives the benefit, not an individual, so there is no corruption.

Asking for a $450 steak dinner from a vendor (backbone ISP Network operations, we buy $180,000 routers) would get you fired by those who decide on the next generstion cire routers and dwdm platform, on the spot.

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