How much do you ask for up front?

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Permalink Reply by Stephanie Benedetto Padovani on October 19, 2010 at 4:15am

I think the amount you need to charge as a non-refundable retainer fee depends upon a couple factors:

1) How likely is it that you can rebook the date if they cancel?

2) How much of an investment do you put in before the day?

3) How much money do you potentially lose if they cancel?

It's different for different businesses. A lot of wedding professionals struggle to balance out cash flow year round, so taking a hefty retainer can really help. It also makes the people who book more serious.

If you reduce your booking fee, be prepared for more cancellations. They have less to risk so they're not quite as committed.

Right now we charge a 1/3 retainer for our entertainment services with the balance due one month prior to the wedding, and we have very few cancellations. Our contract clearly states that this is non-refundable. However, we offer refunds on a case by case basis, either if we rebook the date or for a death in the family,etc.

For us there is actually quite a bit of time and energy spent before the date. Plus, we have a limited "inventory" of weekend dates we can possibly book, and the retainer is necessary to secure our risk when we turn away additional jobs. That's why it works for us to take a larger retainer.

Danielle, what is making you consider this change? Have you had poor results with your current fee structure?

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Permalink Reply by Danielle Pasternak on October 19, 2010 at 4:27am

It was actually do a recent personal situation. I moved about an hour and a half away and obviously took my business with it. To be fair, I notified my clients regarding the move and (thankfully) they all understood my situation and still wanted my services. BUT, if they hadn't it would have been very difficult for me to refund all that money. I DO know that I wouldn't have technically had to refund them, but out of fairness and just good policy I wanted to be upfront with them.

Just got me thinking I suppose. Another reason was because when a client books me, and I get 50% down, often I don't start really working on it until almost a year later. Well, it's nice gettng 50% down now, but when I'm doing all the work on it and only getting the remaining 50% it's tough. I guess I'd rather get more when I'm actually working on the client.

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Permalink Reply by Stephanie Benedetto Padovani on October 19, 2010 at 6:03am

That makes sense. Structuring your payments differently can really help with cash flow.

Have you considered payments of 1/3, 1/3 and 1/3? A local catering company who owns 4+ facilities in our area uses this approach. It evens out cash flow and works really well for them.

I'd just be concerned about making your initial retainer/deposit too low.

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Permalink Reply by Curtrina Brenner on March 24, 2013 at 12:42pm

I am a wedding planner, and I do the payments in 1/3rds. 

I require 100.00 to hold the date (which comes off the balance) and a 200.00 in the form of a check for security deposit (which is held until after event)  

6 months before 1/3

3 months before 1/3

1 month before final 1/3

It really works for me.

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Permalink Reply by Annie Byrne on October 19, 2010 at 6:39am

For a day of coordination I normally take just less than half with the balance due the day before the wedding. For a full planning I take it in thirds. I've never had any objections or difficulties.And a contract in all cases of course.
My cancellation is written into my contract that they pay me per hour at a set hourly rate of work done up to that point and if refunds are due, I will give it to them.
Thank goodness no cancellations though!

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Permalink Reply by Barbara Ross on October 18, 2011 at 8:12am

May I ask how long you have been in Business. I am starting to do this as a business this year and I am trying to get a feel for how I should structure my payments. I have done it for years for friends and family but there is so much more to structure and consider now that I doing it for my business. How did you decide to set your prices?

 

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Permalink Reply by Kathy Lynn Kinzel on October 20, 2010 at 6:42am

Hi! I am a destination wedding planner for Puerto Vallarta -but am US based. I require a signed draft contract (which contains basis information with respect to their event) and a 50% non-refundable retainer (written into contract) of just my consultants fee to save the date. The balance of my fees is due 30 days prior to the wedding date along with the final signed contract (which will contain all of the couple's services that they have chosen for their event). Refunds are on a case-to-case basis, but since I am a destination planner - it is hard to rebook the same date - so I really do not give a refund - since I do not work for nothing. All service vendor payments are due upon arrival of client in Puerto Vallarta (which is typically 3 days prior to the event) and must be in US cash for ease of exchange. Hope this helps.

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Permalink Reply by Kattia Gordon on October 24, 2010 at 1:19pm

I ask for $200 dollars at the time of contract and then break the balance into payments if they need a more manageable way to pay. The $200 is non refundable

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Permalink Reply by Rachel Corrine on October 25, 2010 at 7:53pm

I agree - I would request a 25% retainer up front...but also consider taking the remainder of the fee in two payments. This way you break it up a bit.

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Permalink Reply by Kristina Rios de Lumbreras on October 26, 2010 at 8:02am

We are caterers but have moved quite a bit into total event production this year, and we charge a structure for cancellations as we feel that since we went to trouble to research, meet with the client, turn down other bookings or things that can bring in business to take the event, and sometimes ourselves make deposits on line items we don't own, we should be recompensated for our time and trouble. Our estimates/proposals have a section called "Cancellation" and it outlines our cancellation structure. Basically it depends on the total amount of the event, for example, if an event that costs $5,000--$10,000 is cancelled the cancellation fee is $1,500 and if it's $10,000-$20,000 the fee is $2,500. And this is only after we have received a deposit or pre-payment from them. We know some caterers and rentals companies that charge brides for cancellations a percentage, such as 10%, if they cancel. This has really helped to weed out the non-serious clients. I met some planners last year and they complained that brides changed color schemes and draping at the last minute and my advice to them was the same as here: if they know they have to pay for their changes they will think twice. In our contracts we specify that the only changes that can be made without a change fee after we receive a deposit is the final head count.
Hope this helps.

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Permalink Reply by Louis King on November 2, 2010 at 4:47am

My charges range from $700 to $1200, and I have reduce my down payment to $150.00 down and it is working. Times are tough and people are holding on to the dollar.


http://www.littleeventsetup.com/Forum.html

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Permalink Reply by Classy Transportation, LLC on November 2, 2010 at 4:54am

A "Retainer" indicates that some level of work will be done upfront and the retainer is a down payment to get started. A deposit means you will hold that date exclusively for the client and if another client request that date, you are legally obligated to decline that business. In either case, when a client canceled, no refund should be expected and that should be clearly stated in the contract. As a limousine service, If my clients cancel before full payment is made (30 days prior to event), the deposit is forfeited. However, they may received a credit against a future reservation. This is our standard practice... http://www.classytransportation.com/

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