Tip #5 Do Not Discount Your Fees
The moment you offer a discount, you are eating into your profits. Is this profit coming out of your salary? That means you are earning less and less every time you give the client a deal. This sets you up for a loss the client is gaining while you are giving away money out of your pocket.
Instead of a discount, you should add value. A value add is a low cost option for you that will make the party a little more special, but doesnt cost you a lot of money. Think about some things in your inventory that will fit with their party and offer them that as a bonus in the proposal.
Maybe you want photos of a new centerpiece that you just added to your inventory. Gift this item to them as a value bonus. The client gets an amazing centerpiece you get the chance to feature something new in your business, and both of you win!
The point behind a value add is to give them something that they want and will also encourage them to book with you. It has to be of value to THEM, not you. Listen during your initial consultation and think about what you have available that will give them the boost they want to sign the contract.
Remember, this conversation is about making a profit on each event, not your whole business. But the more you make a profit on each event, your business will start to profit as well. It takes time to learn your hours and what will work, but the more you do, the better you will be. You will be more confident in speaking with your clients and how to present yourself.
Create A Business Plan
Every business needs a plan. This will function as a guidebook to take your startup through the launch process and maintain focus on your key goals. A business plan also enables potential partners and investors to better understand your company and its vision:
- Executive Summary: Brief overview of the entire business plan should be written after the plan is complete.
- Business Overview: Overview of the company, vision, mission, ownership, and corporate goals.
- Product and Services: Describe your offerings in detail.
- : Assess market trends such as variations in demand and prospects for growth, and do a SWOT analysis.
- Competitive Analysis: Analyze main competitors, assessing their strengths and weaknesses, and create a list of the advantages of your services.
- Sales and Marketing: Examine your companies unique selling propositions and develop sales, marketing, and promotional strategies.
- Management Team: Overview of management team, detailing their roles and professional background, along with a corporate hierarchy.
- Operations Plan: Your companys operational plan includes procurement, office location, key assets and equipment, and other logistical details.
- Financial Plan: Three years of financial planning, including startup costs, break-even analysis, profit and loss estimates, cash flow, and balance sheet.
- Appendix: Include any additional financial or business-related documents.
Fees Based On Percentage Of Expenses Plus Flat Fee/hourly Rate
Sometimes youre being hired to organize an event, and for whatever reason, the client prefers a rate based on a percentage of expenses. However, this isn’t enough to cover the cost of your total time and services. In these situations, it is reasonable to present your fees at a combined cost in two different categories.
For example, a client hires you to organize events associated with a conference. Your assignment is to organize two private dinners and a golf outing, each with 50 guests. The total cost for these combined events run approximately $20,000, but it requires about 60 hours of your time, and the complexity of this project may justify a higher profit margin. Keeping that in mind, you may come to your final flat fee and hourly rate with the following calculations:
Percentage of Expenses Estimate:60 hours x $75/hr = $4,500Hourly Deficit:$3,600-$4,500 = -$900
If you come to a deficit, as we did in the example above, you may choose to quote 15 hours to manage the logistics of multiple outside vendors. Your quote then may reflect the following:
Subtotal Event Expenses: $23,600Flat Fee: $1,125
In this scenario, you will need to carefully determine that you have estimated your hours appropriately . As expected, few clients are pleased to see increases in expenses later on unless justifiable reasons are provided.
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The Geographical Location Of The Wedding
Wedding decorators will be more expensive in areas with a larger population and/or a higher cost of living. More specifically, weddings in metropolitan areas and resorts are pricier to decorate than weddings in small towns and rural provinces. This accounts for how products and services are costlier in major cities.
Note that your wedding decorator may also charge you for travel-related expenses, particularly if they will be traveling to accommodate you and/or if your wedding is in a remote area.
How Much Do Event Decorators Charge
For one session of basic consultation a decorator’s fee ranges between Rs. 500 to 1000. This includes taking a look at the venue, discussing the specifications and modifying their skills according to your needs.
Weddings- Decorations can cost anywhere between Rs. 40,000 to 5 lakhs depending on your requirements and budget. Around 20-25% of your wedding budget goes into the venue and decorations. Most couples prefer a grand entrance with loads of lights and flowers, since that is the first thing the guests notice, so make sure you discuss your concerns with your decorator.
Birthday parties- Decorators charge anywhere between Rs. 2000 to 10,000 for balloon arrangement, table set up and putting up other decorations you might need. The cost might increase of decrease a little depending on the type and quality of decorations you purchase.
Anniversary parties- Decorators charge anywhere between Rs. 3000 to 15,000 for decorating the venue with balloon arrangements, flower arrangements, candles, lanterns and lights depending on how fancy the decorations are. If you would like to host a big party, the charges will increase going up to Rs. 20,000 for setting up the venue and decorating It according to your needs for the party.
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Step : Research What Your Competitors Are Charging
Just like you price match when shopping, event planning customers do the same. What your competitors are charging will affect how much customers are willing to pay for your services. The idea here is to not copy your competitors pricing but to use this information to inform your own pricing calculation. This is one of the best ways to gauge where your fees should start.
How can you confidently say you are the most reasonably priced or the best value if you are not aware of what youre up against? Heres what youll need to do.
Before you settle on a price for your services, call around and find out what other event planners in your area are charging.
According to industry expert Patty Sachs, event planners make anywhere from $12 to $75 per hour, plus vendor commissions.
Once you have done your research list the three most common prices quoted by event planners in your area.
Now that you have your three comparison prices, sit with these prices for a moment and try to determine where your price should fall. Think about the ranges above, your skills, experience, and knowledge, and pick aprice.
You read correctly, just select a number that would work for you I promise you there is a method to this madness.
Remember to never price your services lower than the range above. It might seem like a good idea if you are new to the industry however, it takes just as much effort to plan a wedding at $25 per hour as it does at $75 per hour.
Tip #1 Charge A Flat Party Planner Fee
So are you running a business or a hobby? A business is meant to create a profit for you. A hobby is an expensive project that just takes your money. In order to run a business, you need to make money, and that starts with your party planner fee.
A party planner fee is the base amount you need to make personally. It is your take home salary from each party. If you are leaving your salary out of your business and not paying yourself for your time, then you cant truly have a profitable business. How can you pay others for everything else and not pay yourself?
If you dont know this number, you need to find it out quickly! If you arent paying yourself, then you arent doing what you need to do to grow your business. Plus, getting paid means you are less likely to hit burnout and hate what you are doing.
You can find out HOW to figure out your party planner fee in our CHARGE YOUR WORTH course inside the Partypreneurs School of Party Planning. See below for more about the course and a special discount JUST FOR YOU!
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You Already Have A Lot On Your Plate
There is a reason why many couples start planning their wedding months ahead of their desired date: a lot of aspects and details require undivided attention, if not one at a time, then multiple things at once. And as you resolve one issue, another one immediately pops up.
Hiring a wedding decorator relieves some of the pressure on you and your partner. They will take your creative vision and translate it into decorative pieces that fit your color scheme and overall theme. They do all the work in terms of embellishing the space and personalizing it according to your preference.
The Number Of Guests In Attendance
As you may expect, if an event is large with hundreds of guests attending, this will be a larger project for an event decorator and in turn, impact the final cost. When you are interested in items and features such as backdrops, centerpieces, and party gifts, the guest count will impact the associated costs.
As stated by Chicago-based Divine by Design, you can begin with a free consultation to discuss your exact needs. Then, quotes are customized in accordance to your specific event. Similarly, Cleveland-based Consider It Done offers free consultations and then offers a pricing system based on package types. One of the variables considered is the wedding size in relation to the number of guests.
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Fees Based On Commissionable Rates
Another way that event planners may collect fees for services is by securing event space through venues that offer a commissionable rate. These are fees typically provided to travel agents for booking tickets, hotel rooms, and other forms of transportation.
For example, many hotels may extend a commissionable rate up to as much as 10% for guest rooms and other expenses.
Although some event planners will embrace commissionable rates as a source of income for themselves, savvier clients may question the event planners sense of loyalties when commissionable rates are involved. For that reason, many seasoned planners will limit any planning selections that include a commissionable rate or negotiate non-commissionable pricing for their programs and pass that source of savings directly to their clients bottom line.
Further, some clients may be aware that commissionable rates exist and do not expect their outside consultants to bill using any of the other identified billing methods we’ve outlined and still pay a commissionable rate. In general, it isnt considered good form by many event planners to essentially double-dip their revenue stream this way.
If accepting commissioned rates, it’s best not to charge your client fees for your services using alternative billing methods.
Fees Based On Hourly Rate
Some clients prefer the event planner to quote an hourly rate for services and to estimate the total number of hours to manage and execute a given client program. It may seem similar to the flat project rate, but it allows for more flexibility on the part of both parties to adjust to changes that may be needed along the way.
Many business event planners will bill hourly for services. It allows a client to know just how much it will cost to hire your services and allow them to calculate a reasonable budget. Frequently, the reason for this is because the client wants to have a better handle on any unexpected expenses.
Always remember to define careful parameters around expectations so that both parties are in agreement as to what services will be provided. As an event planner, you should include a reference to billing for all reasonable business expenses that may be incurred.
Some event planners may mark up operating expenses such as shipping, car rentals, and other miscellaneous expense items by as much as 15-20%. If you do, you should disclose such markups and obtain agreement with your client in advance.
When it comes to hourly event planning rates, it is also important to determine how frequently you may bill for your time.
Under this agreement, you and your client should both work out a detailed statement of work that includes the expected responsibilities of both parties. Then, you may estimate a total budget of so many hours plus reasonable expenses .
Additional Pieces To Consider
Almost all event planners charge a deposit for their services at the time the contract is signed. This is important because you are holding space open for that client and you may not be able to book another at that time. Youll also want to collect for services before the event. Dont get caught putting in hours youre never paid for.
Some people just need a consultation and some planning advice. Others may seek out your services for theme ideas or day-of coordination. They may not be able to afford your full package so a little bit of assistance is what theyre looking for. This type of activity is usually charged by the hour and offers a nice fill-in between events since the time invested is minimal.
Create A Thorough Business Plan
You may be tempted to jump into action and start pursuing those dream clients, but taking the time to write a well thought out plan is an essential step for any aspiring entrepreneur, including party decorators. This step will help you think through all of your small business details and give you a chance to catch flaws in your plan, such as an unsustainable pricing structure before they become a problem.
Say goodbye to paperwork
Another reason to create this document before you start an event or party decorating business is to access funding. Banks, creditors, and granting organizations will typically want to see that you have put thought into your operation to help them make sure they want to fund your small business. They also want to see that youve considered your budget and can operate within it. A business plan allows you to demonstrate your knowledge of the industry, the market size and opportunity, an overview of your services, how you will go to market, and how your business will turn a profit.
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Essential Software And Tools
Being an entrepreneur often means wearing many hats, from marketing to sales to accounting, which can be overwhelming. Fortunately, many websites and digital tools are available to help simplify many business tasks.
They Have A Team That Will Help Set Up
Usually, the wedding decorator will have a team of people who will help them set up and arrange the decoration. As mentioned earlier, your wedding decorator and their team will do all of the work for you, from brainstorming to actualizing your ideas. However, they may appreciate a little help from you and your partner, especially in fine-tuning the details.
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How Much Does An Event Planner Cost
Are you planning a wedding, corporate event, or big family blowout? Are you considering the advantages of hiring an event planner?
You can save yourself a great deal of time and headache by hiring a wedding or corporate event planner. These folks will take over the details and allow you to enjoy the big day without missing any moments while youre worried about the menu.
But can you afford professional planning? How much does an event planner cost, and is it worth what youll end up spending?
Heres what you need to know.
The Theme Of The Wedding
The theme of your wedding affects the complexity of the design and the kind of pieces needed. For example, if you want your wedding to have a rustic country theme, you could decorate a barn with some country elements such as gingham, ticking stripes, florals, all while using vintage or distressed furniture.
The aforementioned theme is relatively cheaper to achieve than fairytale-themed weddings. Such weddings would require elaborate lighting fixtures such as chandeliers, chairs, and tables with ornate patterns or expensive cloths, and sparkling and bejeweled decor.
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What Is The Fee Structure Opted By Your Decorator
There are several factors a decorator considers before opting for the apt fee structure. The rates vary based on the location, the type of project and what the market is willing to pay. A decorator can base his fee structure on various factors and understanding this structure in detail before sealing the deal is essential. Here is a breakdown of various types of fee structures:
Flat project fee
Some decorators prefer stating the entire cost of the event inclusive of all fee right at the beginning. This is called a flat fee and is usually quoted for packaged events, where the cost is calculated on a per- person basis. This gives you an idea about exactly how much each aspect of the event will cost and puts the responsibility of managing the budget on the decorator.
Fee based on percentage of expenses
In this method the price is established based on a specified percentage of the total expense of the event. This often costs less than any other form of fee structure. It typically ranges between 15 to 35 percent and is usually negotiable to fit your budget by making cuts here and there. Decorators usually opt for this method if the planning time of the event is minimal and if it is a small scale event.
Fee based on hourly rates
Fee based on commission