This is a delicate subject in our industry, and one I feel very strongly about because many years back, besides bad pricing, this was one of the main reasons I almost went out of business. For me, it is very simple: if you accept commission without your client’s knowledge, it is THIEVING (and I’m not the only one who feels this way–this practice is against the law). Someone along the way has been short changed and it’s usually your clients.
Here is the dilemma:
I have been approached by many planners with the question, “Do you pay commission?” (meaning do I pay commission without my client’s knowledge). No, I do not pay or receive commission. Of course, they then go on to work with another person who does and I lose out on the job. My advice to you: LET THEM. The reason is simple. As I discussed in my entry on pricing, if your goal is to make a 40 – 50 percent profit, and you give away 10 – 20 percent of your profit, you’ll be losing money BIG TIME. Your other option if you pay commission is to spend less money on your flowers or materials in order to cut even which leads to producing an inferior product that causes you, in the long run, to lose (your clients lose too).
I understand that taking a stand in not paying or accepting commission might make you feel like you are losing out on jobs, but as times goes on, you and your brand will develop a reputation of quality and integrity. Do not get me wrong. If someone recommends me for a job, I have no problem sending them a present as a thank you to show my appreciation with the promise that if the opportunity emerges (and it always does) to recommend them in return, I’ll do so.
It you are a planner or any other vendor and you make your living by a commission structure with your clients knowing, fine. Otherwise, I think it’s time for this practice to be completely discontinued. The part I resent most is the power trip these few folks have in our industry. They form alliances with vendors not only for the quality of their work, but for their own greedy reasons. On top of losing money, we also have to mention the anger one feels, after busting one’s butt to do a great job, to then have to turn around and give away part of one’s profit.
What is your opinion?
George Bernard Shaw once said: “You see things and say, ‘Why?’ But I dream things that never were and say, ‘Why not?’” That quote embodies how Preston Bailey approaches every event.
Shawna
February 25, 2010
I agree with you 100%. Collusion is against the law, and it makes me so sad that many thousands of dollars are taken from South Asian brides without their knowledge. Thank you for writing this article Preston!
Barb Cameron - Ottawa
February 25, 2010
I completely agree! I am a wedding photographer and love working with many wedding planners in the city. However,there is one planner that wants a kick back to the tune of 5%. This cuts iinto my income, yet I feel as if I am forced. Well forced no longer! It will be the client losing out if they higher a planner who only deals with those that give her/him kickbacks. I will find myself “booked” everytime this planner wants to recommend me for a wedding. Eventually, she will realize that not alot of the best vendors will want to deal with her.
K Brock
February 25, 2010
Sometimes one has to learn the hard way.
MELISSA
February 25, 2010
IT’S HARD WHEN ONE IS JUST STARTING OUT AND OFTEN TAKES WHAT EVER THEY CAN GET…
I THINK THIS PRACTISE HAPPENS IN MANY FIELDS OF WORK…. THE CLIENTS ARE OFTEN THE ONES THAT GET A LARGE BILL IN THE END WITH LOT’S OF HIDDEN COST PUT IN TO MAKE UP FOR THIS…. IT RUNS RAMPED IN THE ENTERTAINMENT WORLD…..
XXOO
MELISSA
Wendy Leung - Beyond Events Ottawa
February 25, 2010
I believe that there is a certain level of integrity and honesty that we must adhere to working within the wedding industry. As an event and wedding planner, we are advisors and we are hired for our client’s best interests and not our own. I find it disrespectful when such people call themselves “professionals”…it just makes it harder for those of us who are trying to get ourselves established and don’t follow or condone such activities. What goes around comes around ;0
Lisa Schneider
February 25, 2010
Very well said. I couldn’t agree more and wish more vendors and planners in the DC-area would understand this.
Liz
February 25, 2010
Thank you for this post – I agree with you 100%! I am a planner in a market where commissions are given and received all the time and I am offered them by many of the vendors I meet, and most are shocked when I decline. I’ve also been told “your clients don’t have to know.” My approach has been to ask if I can pass the commission on to my client in the form of a discount, and this is a huge selling point for potential clients.
Sonia
February 26, 2010
I am shocked that so many would dream of paying or receiving commissions and have it come out of clients’ pockets. If a vendor wants to give a GIFT of appreciation, not a percentage or commission, to another vendor it should come out of their own pocket. Giving is not real giving until it costs the giver. The giver just has to use wisdom and give only when they can afford to give.
To those that demand commissions, double shame. Where is the confidence that, in time, your own work will compensate you enough?
What has this world come to? So many are in business who do not genuinely love people but are only driven by greed. The goal at the forefront should be to perform a craft passionately and bless those requesting your service of it and the monetary and other wonderful rewards will follow.
Yvonne Stewart
February 26, 2010
I agree with you 100 percent. Our clients trust us with the most important events of their lives and for us to take advantage of that trust is pure thievery!
Rashana of THE BRIDAL PARTY LLC
February 26, 2010
I’ve never felt accepting commission was ethical, so it’s always been our policy not to do business that way. I wasn’t aware it was against the law, however. Wow!
Whatever discounts or special offerings I’m able to negotiate with my vendors I directly apply to the client. I feel this helps my relationship with the client as well as those they will eventually refer me to.
Don at The Edge
February 27, 2010
The basic problem with commissions (kickbacks) is that the coordinator or venue is no longer working in the best interests of the bride who has hired them, but instead has the incentive to recommend vendors who pay them the largest kickback. It’s no longer a case of looking for a good fit between the client bride and vendors, but who is going to pay me the most.
In particular many of the best vendors won’t pay a kickback so the coordinator or venue refers newbies, or beginners that don’t know better, or are desperate.
Vendors that skip in one area on ethical business practices will also skip on other areas like having liablity insurance, paying taxes, etc.
We are fortunate that it doesn’t seem to be large problem in this area and established businesses know who the scumbags are and avoid them and exclude them from legitimate referral networks.
Good of you to bring this to light as most brides are unaware of these tactics and the negative impact it can have on their day.
James - NYC Wedding Photographer
February 27, 2010
If professional need to be careful if they are only referring a vendor because of the kickback rather than making a true recommendation. You only have one name and keeping a great reputation is very important in this business. We only recommend people we really like, trust and think would be a great fit for our client. We don’t want to jeopardize our great reputation or relationship we have with our clients because we made a bad recombination.
Danielle - A Special Occasion, LLC
February 28, 2010
It would appear to me that a planner or company that uses that as a sorce of income doesn’t have concern for the client at all. The obtaining of clients is just a way to maximize on potential profit and not the happiness of the day they are supposed to be creating. This a practice we haven’t encountered in the area where we live, but despite that, the business eithics alone is toxic to an industry that already has to prove and explain itself on why planners should be used in the first place. It truly just amounts to simple greed and placing money in their pockets by any means necessary. Shame on any planner or business that uses this as a model to turn a profit. That is the reason why people choose the “DIY” route and end up with potential problems because they believe planners are unnecessary expenses. Those are the planners that make it hard for others in the industry.
Kurt Vinion - The Wedding & Lifestyle Photographer in Prague!
March 1, 2010
Some of you are very lucky, here in Prague some wedding planning agencies demand a commission or what I term a kickback up to almost 33%. Yes you read correctly. And the photographers are giving the cruel designation of Photographer A, B, C, D which only adds more insults to our profession as the brides never know who they are getting which is truly dumbfounding.
As an American wedding photographer based in Prague, I chose not to work with those agencies and of course I suffer in the end, but I am truly happy knowing I provide the best product and service to my clients and my reputation continues to grow.
Devon Wedding Photographers
March 3, 2010
I totally agree, this is someones wedding day and I think it is awful that the couple are the ones having to pay extra as the photographers will probably add an extra 10% on top to cover the commission they are paying out.
pharmacy technician
March 4, 2010
Keep posting stuff like this i really like it
Ali- Berber Events
March 8, 2010
well Said,
Yogi
April 1, 2010
Preston, well said and you hit it on the nail. I just found out about your blog posting on paying or receiving commission through a very good friend of mine Shawna. I am so chuffed to know that a person of your caliber has such high ethics. You are in the position to ask whatever you want but don’t and are doing the right thing. I am a photographer in California and there are many many wedding coordinators that demand 10% to 15% to be on their referral list. Which is utterly highway robbery which the client in turn the client pays for.
You have tremendous number of followers and hope your word will get through to those who are practicing unethically.
I agree what Sonia what she said in her posting.
Myriam Alexis
May 15, 2010
Hi Preston, I didn’t know anything about this, thank you for saving me in advance.
xXmikecenXx
July 21, 2010
I’m trying to open forum but sometimes there are no images on it
noryvininny
July 27, 2010
Без салонов красоты и студий загара сложно представить нашу жизнь. Мы уже сами, не осознавая происходящего, регулярно посещаем студии загара, пользуемся услугами салонов красоты. Если нам предложить отказаться от данных услуг, мы испытаем как минимум шок…
А что бы его не испытывать естьРейтинг заведений красоты
Armando Codina
July 28, 2010
Finally have all the info I need for my research, great post!
Armando Codina
July 28, 2010
I have searched all over google for info on this topic, I finally found a good post, looking forward to coming back!
escovequock
August 2, 2010
http://veselyjsoft.com/
Karie Ashbrook
August 7, 2010
With regard to the title Preston Bailey’s Common Mistakes: Paying or Receiving Commission | PrestonBailey.com, it sort of jumped out at the screen for a second but finally I get what you’re saying. I’ve been thinking about the same kind of stuff at my blog http://furnituresearch.tumblr.com. I would honestly appreciate your input on what I talk about. Karie Ashbrook