Most event planning professionals know that event planning contracts are a critical component of a successful event planning business. And while the word “contract” can bring a negative connotation in today’s litigious society, having a legal contract simply forces both parties involved to agree to a set of terms and conditions which could emotionlessly relieve concerns by all involved.
Why You Always Need a Contract
In certain situations, the ramifications can be both detrimental and costly. Having an event planning contract in place ensures that both you and your client have a clear understanding of the work that will be completed and other necessary aspects of conducting business together. When developing your event planning contract, be sure to include these five items.
Clearly Specify the Event Planning Services That Will Be Provided
As an event planner, listing the event planning services that you will be providing may seem like the most obvious item to include in an event planning contract. And, in some ways, it is. However, specifying in detail which services you will be providing is critical as your work will be limited to providing only those services specified on this list.
Event planners perform a broad range of services and the services provided can vary from one event to another. One event planner may provide floral arrangements, another may not. Some event planners may assist with venue selection and others handle transportation needs for guests. No two event planners are exactly alike. Hence, no two event planning contracts are exactly the same.
While your event planning services will be limited to those items specified on this list, it is important to also list services that will not be provided. Why? It helps you to have these tasks listed in the event planning contract so that your client knows outright that these are services that you will not be performing.
It is also helpful to have this in writing and agreed upon as part of your contract so that, in the course of planning this event, if your client should request that you handle these responsibilities, you have a contract to stand behind when you politely decline to perform these tasks. Use broad language to protect yourself against performing something that is outside the realm of your agreed upon event planning services.
All event planning contracts should include terms of payment and specifics regarding the payment schedule. Begin with the initial deposit due date and clearly communicate that no work will begin on planning this event until the deposit has been received. If the event date has been selected, indicate the date upon which the deposit must be received in order to deliver the services for that particular chosen date. Provide a payment schedule and details regarding future payments, either establishing a set calendar date for each payment or tying each payment to a milestone in the event planning process. Establish a payment schedule that best suits your business and your cash flow. Include any taxes and added fees.
Terms of Event Cancellation
What happens if – at any point in the event planning process – your client cancels the event? Don’t leave that outcome to chance! Your event planning contract should include terms for event cancellation. This is an important part of the contract that will protect both your business and the expected income from this event.
Specify that the initial deposit and all payments made up until the point of cancellation are non-refundable. This will ensure that you will be paid for the work already completed. This is critical in event planning as most of the work is completed prior to the actual event itself.
Consider including a clause stating that clients are responsible for payment of any services rendered up until the time that written notification is received regarding event cancellation. This is particularly helpful if your payment schedule is structured in a way that allows for work to be done in between regular payments.
What if a hurricane arrives just in time to wreak havoc on your otherwise well-planned event? Circumstances beyond your control – such as extreme weather or labor stoppages – that cause either party to be unable to fulfill the terms of the event planning contract are protected by a termination clause, also known as a force majeure. By including a termination clause, either or both parties are absolved from liability in these circumstances. Be sure to specify the terms and timeframe for termination, such as noting the reasons for cancellation.
Most contracts contain an indemnity clause. But just because they are common, you should not underestimate their importance. The inclusion and scope of an indemnity clause can significantly affect your business. Basically, an indemnification clause provides protection if your client does something that causes you harm or results in a third party suing you for damages.
In simple terms, it means your client cannot hold you responsible for any losses, damages, liabilities or expenses that are a result of their negligence. Most importantly, when preparing an event planning contract, do not sign anything until you are completely satisfied with the terms.