Sometimes you’re 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 fee as 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 plus the complexity of this project may justify a higher profit margin:
Percentage of Expenses Estimate:
$20,000 x 18% = $3,600
Hourly Rate Estimate:
60 hours x $75/hr = $4,500
Hourly Deficit: $900
Therefore, you may choose to quote 15 hours to manage logistics of multiple outside vendors. Your quote may reflect the following:
Subtotal Event Expenses: $23,600
Flat Fee: $1,125 (based on 15 hours at $75/hr)
In this scenario, you will need to carefully determine that you have estimated your hours appropriately (and account to cover non-standard operating expenses such as personal travel). Few clients are pleased to see increases in expenses later on unless justifiable reasons are provided.
Additional ways to structure event planning fees, next page.
