Hello everyone! I am hoping that someone could give me some good advice!

I need to know what to do when a client originally came to you through an event coordinator (who received commission for joining us) comes back again for another event and doesn't involve the coordinator.

Should I still give her (the coordinator) a percentage of my profit?

Or would that only occur if the coordinator was involved?

What are your suggestions? MANY THANKS for your input!!

I'm new to the biz side of baking

are they using the coordinator at all for their event? If not, I say you don't owe them a thing.

I would say that, if you didn't sign anything with the coordinator saying you wouldn't see the client for future events, then you're off the hook.

I wouldn't work with a coordinator who expected to get a kickback from referring to you, which is what "commission" is. That's unethical, in my opinoin. I would charge the client the same price as anyone else and not worry about the coordinator, she's not involed in this new transaction.

I am happy to work with wedding coordinators. I give them 10% or $50 - whichever is lower (this applies to product, they don't get a cut of extras such as delivery fees or stand rentals). This would apply only to NEW customers they bring in - they would not be entitled to anything on future orders from someone they referred to me.

I'm a little surprised at the idea that wedding coordinators shouldn't get a cut of things - they need to earn a living too, and I would assume they have to deal with Bridezillas more than we do. I see that 10% cut I give them as money well earned for dealing with the bride and family so that I don't have to. LOL!

ETA: Think of the portion you give them as advertising fees/promotion costs (they are promoting your business and bringing customers through your doors), debt collection (they make sure you get paid and you don't have to deal with it), and mediator (if there is a problem with the cake, the coordinator will help resolve any issues). I think if you look at it that way, you might realize the cost isn't that great all.

E(again)TA: This only applies to PROFESSIONAL coordinators.

I don't see anything "ethically" wrong with offering a referral commission on the first order. However, followups are a different matter.

I dealt with this same scenario on a much larger scale at my last job. I was a showroom consultant for high end building supplies. We had contracts with builders, plumbers, designers, and so on for them to send their clients to us for their product selections. Most of the time it was a pretty good system. Prices were based upon the amount of business that our original customers did with us. The more volume you bought of a particular product brand, the better the price. If you deviated from something brand specific (which often happened) it was normal pricing the same as anyone who walked in without an account.

The only problem with this arrangement was the snooty customers that thought it didn't matter what brand the product was, they should still get a discount of the same nature, even if it was below our cost. Foolish. Their incentive was to have their client use brand x and not need to come in our store, and if they came in our store they were no longer doing the work on the selections so we made our money too.

Designers were the WORST though. This is where I would most likely compare SOME wedding coordinators. They expected a kickback for every customer they ever mentioned our store too, even if they didn't send them in. They expected better prices on truly custom handmade items than our biggest builders, essentially cutting into our commission as sales associates. The thought when they brought clients in that we shouldn't even tell pricing, but give them a quote later so they could mark it up as they saw fit, but they should still receive the best pricing possible. So of course when they finally gave the client the quote, the client thought our prices were outrageous and wanted to shop somewhere cheaper.

So it's a sticky world of kickbacks and referral fees. Some people are completely out of their minds expecting something for nothing regularly. Jason is right. The most reputable coordinators put their clients needs above a kickback, because they know that they will make money doing what they do best and making their brides happy.

So just because someone comes in and suggests this arrangement, do not by any means feel obligated to respond immediately or even participate. In my opinion, the ones that are more insistent on the front end are the ones who are the biggest pains and least loyal on the back end, because it's not about building a solid business relationship, it's about the fastest way to get money in their pocket.

I never, never, never deal with coordinators who want a cut of anything, or who refuse to allow me to deal directly with the client. They get paid a flat fee for their services from the bride, and that's how they earn their money. If they want a percentage from you that's a kickback, and I believe it's illegal. At best it's unethical, because the coordinator will steer clients in the direction of the people who are willing to give the kickbacks, regardless of the quality of their work. That doesn't benefit the bride, who, I assume, has hired the coordinator under the premise that the coordinator will know who does the best work.

The coordinators who I work with call me, say "I have a bride for such and such a date" then leave it up to me to deal with the bride from there. Not one asks me for any kind of percentage or fee to refer the bride. They know that the benefit that I'm giving them is that I'll try to work the bride into my schedule, even if I have on my calendar that I'm booked.

For example, if a bride calls and asks for a cake on a date that I'm booked, I look at my calendar and say "I'm sorry, but I'm booked for that date." If she's hired a coordinator who I work with, though, and the coordinator calls for the same date, I'll walk into my office and check the other delivery times and locations for that date before I say that I can't do it. That's the benefit of hiring a coordinator,they can open doors that may be closed otherwise.

One so-called coordiantor who I'd never heard of before refused to give me the bride's contact info and told me that she controlled all the appointments, etc. I assumed that meant that the bride was going to get a markup if I sent the coordinator the contract, and that the bride wouldn't ever see what I said the actual price was. I told the coordinator that I wouldn't work with her under those terms. I'm not in the business of gouging people.

Costumeczar, I actually thought about going back and amending my post for the second point, but decided to leave it as food for thought so people could make their own call on it. One of the perks of being smaller businesses such as bakeries is that you can absolutely choose your clientele (within reason). I worked for a very large international company, and within that company the policy was for certain that the customer was always right, regardless of what type of customer it was. So we spent a lot of time trying to make everyone in the world happy, regardless of what reputation they had. It was absolutely exhausting and ridiculous to see some lazy designer profit off my knowledge and work with no input of their own whatsoever. Had I had the support of my superiors, I certainly would have shooed many clients right on out the door along with their sense of entitlement.

If I were a small scale business and profiting well enough to survive, I would certainly try to build my customer base without including people who want something for nothing.

As far as the legalities of it, honestly there are so many loopholes and ways around it. Part of my job as a salesperson (at least according to my headquarters) was to push certain brands that we got better pricing or kickbacks with. There were all sorts of incentive programs offering spiffs (monetary or product compensation that we still claimed taxes on) for pushing certain products. I know some people specifically tried to sell everything that they could get a spiff for. I won't deny they were nice perks, but I was one of the few that really tried to give the client what they wanted regardless of how it would affect my paycheck. That was my job, and I took pride in that. I took a lot of heat for not pushing HQ preferred brands and going with small companies with better products.

The one thing I could never stand was being told by a coordinator or venue that for a fee, they would refer people my way by being on their "preferred vendors list". I assume preffered is cause they are a good vendor, but how does that work when just anyone can pay to be on their list. I always felt that was just low. So, if I was a really crappy vendor, I guess it wouldn't matter to the coordinator or venue, cause I am giving them a kickback. Hence, why I find it to be so unethical. If you hire a wedding corrdinator, she ain't working for free, she gets paid a nice up front sum. And her job is to find you the best vendors, for the right reasons, not cause they pay her. I know one that charges $5,250. Now, to want kickbacks on top of that is just insane! And this the wedding business, so I am sure kickbacks work differnt in other business areas, but not the cake business.

Having a number of wedddign planners as personal friends, I can safely add to this conversation that GOOD coordinators/planners are APPALLED at those who hike prices on products and/or expect a kickback and I, too, would not work with such planners.

This practice actually discredits the planners reputation because their brides tend to think (as was hinted at in an earlier post), "She's only referring me to THAT vendor because she's getting a kickback from them!" It leaves a bad taste in the brides' mouths. Brides are advised that any discount or 'commission' a planner gets should be a savings that is passed on to the bride, which is how reputable planners view it.

because ... as has been stated ..... the planner makes her money by the fee she charges, not from the kickbacks she gets from vendors.

The vendors will make money from her referrals ... the planner will make money as her reputation grows for providing good qualtiy vendors at good quality pricing.

To the original question, you owe nothing to the planner for subsequent bookings. Just because she sent you a bride, doens't mean she owns you for life.

Jason, I've run into a lot of brides who have either changed their venue and subsequently worked with different planners, or who fired their planner for whatever reason and are looking for new vendors. And remember that even though wedding cakes are one-shot business, they're good for many, many referrals from happy brides to their friends who are getting married. And for many, many "don't use that vendor" from the unhappy brides.

QTcakes1--I wrote a blog article about that issue, which also really cheeses me off. http://acaketorememberva.blogspot.com/2010/12/preferred-vendor-list-sometimes-isnt.html

Sometimes the wedding business stinks, and you just have to decide how low you want to go. Unfortunately my parents raised me to be honest, so I'm often at a disadvantage

I guess that based on the number of responses I've given on this thread you can all tell that this is a pet peeve of mine. I found this other article I'd written about it after I got about 5 people emailing me saying "Put me on your preferred vendor list." Seriously, a few people said "put me on your list." No please, thank you or introducing themselves. What the heck? Plus, I got to use the word "pimp" in my blog, which was fun.
http://acaketorememberva.blogspot.com/2011/06/i-am-not-wedding-pimp.html

"pimping" is the exact word that came to mind as I was reading this thread too.


I would never ever work with a planner who wanted a kickback from me....no way.

It cheeses me too, to think that just any crappy baker could become a "preferred vendor" just by paying 10 or 20% to the planner.

No thank you. I wouldn't want my name associated with planners like that.

OP I don't think accepting future orders from this client is unethical at all...as others have said the planner isn't involved.

Great thread BTW...it's nice to see how many of my professional peers feel as I do about sketchy planners.

costumeczar, both of those article are "nail on the head" articles! We share very similar philosophies!

http://cateritsimple.blogspot.com/2010/06/what-does-it-mean-to-be-preferred.html

I find it a little odd that coordinators bumping up prices is considered unethical, but the baker inflating the price to cover the coodinator's cut is OK?

Really?

Justify it any way you like - it's gauging the bride. At least when I pay a referral fee, it's not costing the unsuspecting bride anything extra.

As for a coordinator knowing who the best in town are, how the heck are they going to know about me until they work with me? And why would I not want to encourage them to work with me? I don't feel the suggestion that a coordinator will steer clients to lousy vendors just to get a cut is really viable - since the bride will also be unhappy with the coordinator and will give him/her bad reviews and complain to them.

In my previous profession, referral fees were the norm. It's considered a "thank you" for bringing me business. I don't see anything sneaky or underhanded about it unless I were do as has been suggested here and pass that fee along to the customer. Now THAT is unethical in my opinion.

To each their own (ethics) though, eh?

A referral fee has never been demanded of me. I pay it as a thank you, as I said previously - it was the norm in my previous prefession and something the coordinators are happy to receive.

As for my "costs", if you will go back to my first post on the subject, I believe that a coordinator often earns that 10% by acting as a mediary between the bride and myself. I have saved time by not doing consulations or extended tastings - a bride comes to me with a cake in mind. I don't have to call repeatedly or send out reminders when payment is due, etc. I believe a coordinator often saves me at least 4 hours, and that to me is worth at least the 10% (or $50) that I pay. So since I am the one saving time and money (and also making money that I wouldn't have otherwise if she referred them elsewhere), then I should be the one paying that money, right? In my opinion it's a professional courtesy that helps establish good working relationships with others in the industry.

Personal choice, and again, doing it my way isn't gauging the customer.