Understanding Standard Agency Pricing Models: Which One is Right For You?
Curating and executing unforgettable events starts with choosing the right planning partner—one who guarantees transparency, efficiency, and alignment with your communication style, company values, and unique event needs, including budget. However, with various pricing models in play, comparing agency costs and value can feel like comparing apples to oranges. Whether you’re planning a corporate gala, an intimate retreat, or a high-energy conference, it’s crucial to understand your budget and maintain a sense of control throughout the process.
At Bash Creative, we understand the value of making informed decisions. That’s why we’re providing you with insider information on the four standard agency pricing models, along with an in-depth look at the pros and cons of each. By the end, you’ll have a clear understanding of how these models work and be better equipped to choose the one that’s the right fit for your next event planning partnership. Interested in a more personalized conversation? We would love to hear from you.
1. Flat Fee or Package
What is it? Agencies charge a fixed amount for their services, regardless of the event's scale or complexity. This is typically calculated by assuming the maximum hours based on the outlined scope of work plus an overage % to ensure profit margins are met. Often there will be preferred vendor partners included in the work which affects the flexibility and customization of the partnership and service.
Cons:
Pros:
Reduced Flexibility: This may not account for unexpected changes or additional work, potentially leading to quality compromises or additional fees, which can feel like “nickel and diming” or surprise increases in budget/workload throughout the partnership.
Risk for Agencies: Agencies might overcompensate for the cost or underdeliver on the service to protect profit margins.
Limited Creativity: Often the only way to make this model profitable is to create a repeatable package that is within a “container.” Therefore there is no flexibility in what vendors you work with or custom additions to the look, feel, or overall experience. Often your event will feel familiar and not stand out as a unique experience.
Predictability: Clients know exactly what they will pay upfront, making it easier to budget.
Simplicity: Straightforward and easy to understand without any hidden costs.
Clear Expectations: The scope is clearly defined so there is no guesswork by either party on the deliverables and timeline.
2. Hourly Pricing Model
What is it? Agencies charge based on the number of hours they spend working on the event, with an agreed-upon hourly and overtime rate.
Cons:
Pros:
Uncertainty: Costs can quickly add up, often by additional meetings, additional iterations, or increased communication. This makes it difficult for clients to budget accurately and usually results in the client taking on more of the workload.
Unnecessary Pressure: More time is spent aligning expectations and reviewing the work efficiency of the agency. Creating a barrier to building trust and breeds a relationship of micro-management.
Most Expensive: While it can feel good to know you have the ability to see where your money is going and a team at your disposal, you rarely have any control over how the hours are delegated and spent. There is an incentive for agencies to have unnecessary roles and tasks to pad their revenues and ensure little risk on their end.
Transparency: Clients can see exactly where their money is going and how much time is spent on each task.
Fairness: Ensures agencies are compensated for all the work they do, especially if the event scope changes.
Flexibility: Agencies can tackle anything you bring their way and you don’t have to spend time approving a change order or revised SOW.
3. Mark-Up Pricing Model
What is it? Agencies charge a base flat fee and, with or without consent of the client, add a percentage mark-up or receive a kickback on the costs of services and products they procure.
Cons:
Pros:
Muddy Pricing: Clients are not privy to the mark-up agreements the agency has with their partners and the % can vary. Leaving the client clueless as to how much they are really paying their agency for their service.
Limited Options & Clarity: In order to receive kickbacks an agency must have a pre-existing relationship, which means that you are not getting access to the entire market of vendors for that product or service. For mark-ups, you will rarely have access to itemized invoices or receipts.
Inhibits Future Planning: without a true understanding of what each element of your event costs it is close to impossible to calculate scale for your growing event in future years. This reduces your flexibility to compare and contrast YOY and you go back to square one when you change pricing models.
Easy Sell: Typically the optics of this pricing model is the cheapest of all four options. Since agencies are making their revenue through multiple streams their proposal will stand out among the rest when presented to your stakeholders.
Uncomplicated: Often a flexible scope like several other models and is set up so you don’t have to do any additional math.
Familiar: This is how the pros have been doing it for decades when clients cared less about the details of the event or the teams they have supporting them.
4. Commission-Based Pricing Model
What is it? Agencies charge a percentage of the total event budget. In return, the agency is on retainer and available whenever the client needs them (within reason).
Cons:
Pros:
Variable Costs: The final cost will vary depending on the final event budget.
Complexity: Requires clients to trust the agency’s budgeting and value-management skills.
Optically Expensive: As a result of the transparency of this model, in the agency sales phase, their cost/fees will likely present as more expensive than the flat fee/project rate or the hourly rate, even if that is not true at the end of the event engagement. Making this a very hard sell to your CFO requires value to be placed on the agility and increased level of support you will receive in exchange.
Trust and Transparency: There are no secrets here as agencies must share exact costs in order to calculate their payment. For budgeting purposes it is a simple formula, cost of vendor + % commission, to determine what your final costs will be.
Scaleable Service: Encourages agencies to increase their scope upon request and do whatever it takes to make that happen.
Research is Gratis: since you only pay a commission on goods and services that have been approved you can go back for several iterations or research without the price of the agency increasing.
Bash Tried & True: Commission-Based Model with a Twist
At Bash Creative, we always have to do it just a little differently. We deeply believe in building trust and ensuring our clients get the best value for their investment. That’s why we utilize a combination of commission-based and flat fees. Here’s why it works for us—and for our clients:
No Nickel and Diming: We don’t believe in charging for every minute spent. Our model ensures we devote as much time as needed to deliver an event up to our standards.
Money Mindset: We believe in a value-first mindset. We present options at scale and are committed to delivering top-notch results without unnecessary spending or cutting corners.
Negotiated Savings: We pride ourselves on our ability to negotiate significant savings for our clients as well as pass on those industry-standard kickbacks as discounts. In many cases, our efforts end up paying for our services.
Transparency: Usually unheard of, we provide full transparency. Thanks to our collaborative budget template and weekly check-ins, you’ll always have the final say on every spend and know where your budget is at all times.
Ready to experience the Bash difference? Let’s make your next event extraordinary.
Bash Creative is an event planning company that specializes in incredible gatherings that go beyond just great design. We’re known for teasing out smart goals for your event and serve up a stylish execution that will keep your guests buzzing. Located in San Francisco, but often found in New York, Austin, Chicago, Seattle, and beyond.