Five things you should look over when you review a vendor agreement.
Do you know what magic sounds like? It is the sounds of champagne glasses clinking, the bellowing laughter of guests and the music blasting loudly because the DJ or performer no longer gives a shit about the volume restrictions. It’s towards the end of an event where I find the most joy seeing the smiles on each and every guest. That’s the sound of magic. Then when you can think to yourself, whoa… we just pulled off a mini-miracle and your client now thinks you’re a living unicorn. Bask in this moment and all of its majestic glory, because a couple hours from now, phase 4 of your work begins. LOAD-OUT!!!
Since the load out process and the intricacies involved are something I’d rather not bore you with in this post, let’s just assume it went wonderfully and we got that all taken care of. Or did it? The real fun begins the following Monday, when we begin to settle up with all those vendor invoices, which were brilliantly negotiated. In case you were wondering how we got here, check out my article on the Event Producer’s Workflow.
First Business Day After your Event
It’s early and you figure you can call all your vendors and thank them personally. Also, this is a great time to ask if there is any remaining balances and if not to send a paid in full invoice. Then the unspeakable happens. One of your vendors informs you that there were a couple missing items and that there was a damaged item as well. You think to yourself, “Are you sure you have the right person?”
I know, you have got to be kidding me. That is a G – rated version of the statements that may be going through your head. The rep says that they will get an estimate and send over a Lost & Damages invoice as soon as they can. Why can’t she tell me the costs right now? But you have to wait it out. Over the course of the next few hours the number of thoughts that run through your mind begins to play tricks on you. What could be taking so long, is NASA calculating the charges? The time creeps by which reminds me of the moments waiting for your parents to come home after they found out you got in trouble at school. If you don’t know what that is like… PURE AGONY.
BING… You heard it, and up pops the notification. In comes an email with an attachment from the vendor. You dive in head first and skip over reading the actual email and go straight to opening the invoice. Opening up the attachment is as if the world slows to a complete standstill and then you see the balance due. Not only are we being charged a replacement fee, to make things even more tortuous you are charged a fee for the item not being able to be used. Now you feel like the salesperson, who was just on the list for your next dinner party, is now your mortal enemy.
How could they do this? Why am I being charged extra fees? Well, I am going to call Sara, the vendor, and give her a piece of my mind. But before you do, you open the second attachment, it’s the agreement you quickly signed. Sara took a moment to highlight the area of the agreement which explains the charges incurred should there be any item damage. Then you have no choice but to go take a lap outside because you acknowledged this, well played Sara… (Insert all the angry emoji faces)
By the way Sara is fictitious! Although this was a slightly exaggerated series of events, this happens more often than you can imagine. It’s happened to me. As much as you will want to fight it, you have to know what you are agreeing to before you sign the agreement. Each agreement is different and it is important to note some of the fine print before your event. I asked one of my mentors Johnny Jos, an Emmy nominated Art Director, what his top 5 things to review before signing a vendor agreement were and will share those with you. Hopefully these 5 items will help you when you have to sign your next agreement.
SCOPE OF WORK:
The scope of work is the most important foundation in your project. It is so important because it helps to ensure the details of your vendors work is outlined and agreed upon. Johnny said to make sure that you carefully read the vendors SOW before you sign off on it.
Johnny’s second fine print that you should make sure to read is the financial clauses that your vendor outlines. Payment schedules, late payment penalties and financial obligations are items that you should never overlook. Many vendors require deposits be paid before the event starts and some provide final invoices upon completion of the event. Whatever the stipulations he states to make sure you check the payment terms.
ENSURE ENTITIES ARE LEGAL:
Today, as an entrepreneur you know the challenges of starting a business. And with that you know that simply starting a business can be the easy part. Johnny says that when you begin working with new vendors it is important to vet them carefully. Make sure that you can find their online presence. Make sure that they are a legal entity. And finally, ask for some proof of prior work with references. You can never be to careful.
LOSS & DAMAGES CLAUSES:
Some of the items you rent will inevitably get damaged, after all, you can’t watch all the guests at your event. Reading the fine print can tell you what the vendor will calculate for costs should something happen to their items. It is also important to note that while your event may be outdoors, damages that are caused by acts of nature while you are renting items can be your responsibility as well. This is why you have to make sure you have adequate insurance.
This brings us to our last item that you should look for in agreements. Johnny notes that you should always look for insurance requirements when renting from a vendor. Some vendors may have requirements that stipulate that you have to cover the value of the item, while others use an aggregate amount for theirs. Ensuring that you have adequate insurance can be complicated, however, make sure you are covered and make sure your vendors cover you as well.
Finally, Johnny has one thing that he sums up the importance of vendor agreements and that is…
READ THE FUCKING AGREEMENT!!!