A new white paper on how independent meeting planners price their services shows that a flat fee is the most popular option for both the planners and their clients: More than half those surveyed say they use flat-fee pricing “most of the time” or “always.”
The report, published by the Event Leadership Institute, is based on survey responses from 300 independent meeting and event planners and the clients who hire them. Among other topics, the survey asked respondents about the use of five types of pricing for independent planning services: markups, commissions, percentage of budget, flat fee, and hourly/daily fee.
On both sides of the aisle, markups and commissions are the least popular pricing option. Markups are used “most of the time” or “always” by only 16 percent of respondents while commissions are used “most of the time” or “always” by just 12 percent. (Fifty-eight percent of the respondents say they “never” use a commission-based fee system, and 53 percent say they never use markups.)
The report authors see the low use of these fee models as evidence of a growing trend toward transparency in pricing. “With non-disclosed models [markups and commissions], the amount the planner is paid is not transparent to the client, unless of course the planner chooses to make it so.” When planners who accept commissions were asked if they disclose them, more than 52 percent say they never or only sometimes do, 32 percent “always” disclose commissions, and 15 percent disclose them “most of the time.”
Percentage of Budget
Only slightly more popular than markups and commissions is a fee system in which independent planners are paid a percentage of the meeting or event budget. Twenty-one percent of the respondents use this pricing model “most of the time” or “always.” The percentage charged ranges from 10 percent to 30 percent of the budget, with the average being 18 percent. However, the report points out that knowing the percentage charged isn’t especially useful without knowing its context: “Say, for example, that Planner A charges 10 percent and Planner B charges 20 percent. If Planner A’s event budget is $500,000, she’s earning a $50,000 fee; whereas if Planner B’s event budget is $200,000, he’s earning a $40,000 fee…”
By the Hour
Hourly/daily fees are used “most of the time” or “always” by 23 percent of the respondents. The survey asked planner respondents for their per-hour rate, within five ranges, and, if they did not bill by the hour, to estimate that figure. The majority charged less than $100 per hour:
<$50 per hour: 17 percent
$50–$99: 48 percent
$100–$149: 19 percent
$150–$199: 10 percent
>$200: 6 percent
The white paper goes into more detail on hourly rates, breaking it down by region of the country, experience, and whether the planner works in an office or at home.
Flat Fees Favorite, but Whatever Works
While planners and their clients prefer a flat fee approach to pricing by a fairly wide margin—23 percent use it “always,” 30 percent “most of the time,” 34 percent “sometimes,” and only 12 percent “never,” the report notes that “any pricing method is acceptable if it’s agreed to by both the client and the planner.” In many cases, more than one pricing model is used on a given project. For example, the report notes, “a planner may be paid for the site-selection portion of their scope of work via a commission, and a flat fee for the logistics and execution of the program.”
The extensive survey also looks at how much independent planners earn per event (and compares that to what clients think planners earn), planners’ annual compensation (broken down by years of experience), and an analysis of the reasons clients hire planners versus why planners think they’re hired. The findings are available now in a 35-page white paper and will also be presented in a video by Event Leadership Institute’s executive director, Howard Givner. Givner is also discussing the white paper’s findings during a webinar February 12 at 1 p.m. EST.