A contract is a legally binding document between two parties. In event planning, the contract is a written agreement that stipulates the client agrees to pay the event planner in exchange of services rendered. An event-planning contract should list specific terms and policies related to the event.
As a new event planner, you may be starting at a company that has contracts in place. If this is the case, take a close look at the language used. Do you understand all of the material? Can you answer questions a guest may ask you about a contract?
You may be starting out as an event planner in a new company or position and have to come up with your own contract. If you are designing the contract, the Internet is a great resource you can utilize to find a contract template. Many Web sites offer different contracts, some you can download for free. You will also find contracts specific to event planning. Use these as a resource to design a specific contract for your company. All event-planning contracts should have similar basic information.
Be sure the language is clear and terms and policies on the contract are current. In event planning, it is important to use common language in a contract. Avoid having your contract sound like a team of lawyers wrote it.
Basic Contract Language
An event-planning contract should have basic information regarding the event. If it applies, be sure to include the following in your contract:
Time of event
Location of event
The cost of services including room charges
The cancellation policies
Charges surrounding a cancellation or a no-show
Guest count and final count due date
Server charges, whether by the hour or in gratuities
Weather cancellations and acts of nature
Other pertinent details
The contract should be signed by both parties and initialed if on more than one page. Some contracts also include details of the menu and room setup.
A client will occasionally need to cancel or postpone an event she has been planning. Your contract should outline the terms and penalties of cancellations. For example, a client canceling within a week after signing the contract may have no penalties for the cancellation. A client canceling one month prior to his event may forfeit any deposits. A client canceling within one week of the event may forfeit any deposits plus 25 percent of the estimated costs.
The estimated costs of an event can be determined by the original quote. For example, an event may have been priced for a dinner for one hundred guests at $100 per person. In the event of a last-minute cancellation, the client would forfeit the deposit of $2,000, plus 25 percent of the estimated cost, an additional $2,500. The total loss to the client would be $4,500.
Cancellation policies vary by the type of event-planning business. The type of event also determines the penalties surrounding the cancellations. For example, when a client has been planning an event for a year or more, the cancellation policy may be stricter: A cancellation made by a client one month before the event may forfeit the deposit and up to 50 percent of the estimated costs.
Breaking a Contract
There are many reasons why a client may break a contract. Relocation, a change in circumstances, and a loss of income may all cause a client to break a contract. In some cases a client may fail to honor the deposit arrangements in the contract. This would also constitute breaking a contract.
Even less rarely, you may be forced to break a contract with a client. Overbooking or emergency situations may cause you to break a contract with a client. Of course, you will have made every effort to keep your obligations to your client. Attempt to have another event planner or company fulfill your obligation in the case of an emergency. You can work out the financial details with your substitute at a later date. If circumstances force you to break a contract, return any deposit to the client and offer referrals to other event planners in your place.