The special events industry has grown enormously in the past decade. According to recent research conducted by Dr. Joe Goldblatt, CSEP (Certified Special Events Professional), spending for special events worldwide is $500 billion annually. Goldblatt is the founder of International Special Events Society (ISES), the founding director of the Event Management Program at George Washington University, and co-author of The International Dictionary of Event Management. "Suffice it to say, the marketplace is large enough to support and sustain your endeavor," says Goldblatt. "If you're working in one special events area, there are many directions in which you can expand. If you're just entering the profession of special events, there's a lucrative market awaiting you on many fronts."
Who Becomes An Event Planner?
Planners are often people who got their start in one particular aspect of special events. Business owner Martin Van Keken had a successful catering company before he decided to plan entire events. Many other planners have similar stories. This explains why planners often not only coordinate entire events but may, in addition, provide one or more services for those events.
Event planners may also have started out planning events for other companies before deciding to go into business for themselves. Joyce Barnes-Wolff planned in-house events for a retail chain for 11 years and then worked for another event planning company before striking out on her own.
Startup Costs
How much money will you need to start your event planning business? That will depend on the cost of living in the area your business serves and whether you work from home or rent office space. It will also depend, to a lesser degree, on your own taste and lifestyle choices.
Keep in mind that while working from home will keep your costs low, you can't start any but the smallest of event planning business on a shoestring.
This chart lists the startup costs for two hypothetical event-planning services. The first business is homebased and has no employees. The high-end business occupies 1,000 square feet of office space. The owner/manager of this business employs a full-time junior planner and a part-time bookkeeper, as well as temporary employees who handle clerical work and who may help prepare for various events. Both owners will derive their income from pre-tax net profit. Annually, these businesses will gross $85,000 and $250,000, respectively. The startup table lists pre-opening costs for the businesses.
| Startup Expenses | Low | High |
| Rent | $0 | $2,300 |
| Equipment | $5,000 | $17,000 |
| Inventory | $0 | $500 |
| Licenses and Taxes | $250 | $350 |
| Communications | $100 | $250 |
| Payroll | $0 | $4,000 |
| Advertising/Promotion | $500 | $2,000 |
| Legal Fees & Accounting | $650 | $1,500 |
| Insurance (1st Quarter) | $800 | $1,700 |
| Miscellaneous | $750 | $1,500 |
| Total | $8,050 | $31,100 |
Income & Billing
The goal in pricing a service is to mark up your labor and material costs sufficiently to cover overhead expenses and generate an acceptable profit. First-time business owners often fail because they unknowingly priced their services too low. According to industry expert and author Dr. Joe Goldblatt, fees are typically determined by three factors:
- 1. Market segment served. Social events have a different fee structure than corporate events. In the social events industry, planners typically receive a fee for their services, plus a percentage of some or all vendor fees. The two income streams produce enough revenue for a profit. In the corporate events industry, however, planners typically charge a fee for their services, plus a handling charge for each item they contract. For example, a planner buys flowers from a florist, marks them up (usually 15 percent) and charges that amount to the client. Another possibility is a flat fee, or "project fee," often used when the event is large and the corporation wants to be given a "not to exceed" figure.
- 2. Geographic location. Fees are higher in the northeast United States, for example, than in the southeast. This difference reflects the variation in cost of living. In addition, areas of the country that have well-defined on- and off-seasons base their prices partly on which season they're in.
- 3. Experience and reputation of the event planner. If you're just starting out in the industry, it's reasonable to charge less for your planning services while you gain expertise.
How, you may ask, are the above-mentioned fees-for-service calculated? Event planners we interviewed price their fees-for-service (the total cost to the client) using a "cost-plus" method. They contract out the labor, supplies and materials involved in producing an event and charge their clients a service fee of about 10 to 20 percent of the total cost of the event, with 15 percent being a rough average.
Marketing and Resources
Print advertising covers a broad range, from a free—or inexpensive—Yellow Pages advertisement to an ad in a glossy national publication costing tens of thousands of dollars. Even today in the online era, most planners agree that an ad in the Yellow Pages makes good business sense. A line advertisement, simply listing your business name, is often provided free of charge when you connect your phone (if you have a land line).
You can also opt for a display advertisement. These are the bigger, bordered ads in the Yellow Pages. There is a charge for these. If you do choose a larger ad space, be sure to include your logo. You may also want to consider advertising in your local newspaper. Many papers periodically (perhaps quarterly) publish special sections for brides- and grooms-to-be. These are good vehicles for promoting your event planning business if you plan to do any wedding consulting.
Dallas planner David Granger agrees. The problem, he notes, is that customers need to see what you do, and a word ad won't accomplish that. He recommends networking and making friends in the industry. That way, he says, "People know you, trust you. They want honesty and integrity."
Networking can help your business in two ways. If people have met you and know what services you offer, they may refer business to you or use your service themselves. Furthermore, networking with hotels, caterers and so on will give you a chance to meet some of the people whose services you may need as you plan events.
Although networking and word-of-mouth are the most common industry strategies for acquiring clients, traditional forms of advertising do have their uses. A distinctive card or brochure sent to a mailing list or to local businesses may attract new clients. A small ad in a local business magazine can help build name recognition. A website on the internet may allow you to attract customers unresponsive to other forms of media.
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