Question 1

What does 'Value Generated' mean?

Accepted Answer

This can be direct or indirect. Direct value is tangible revenue, like a food vendor's sales at a festival (if you get a cut) or a sponsor's fee for branding a photo booth. Indirect value is an estimate, such as the lead generation value from a sponsored kiosk or the brand exposure value from a well-known entertainer.

Question 2

How can I measure the value of a non-revenue-generating vendor?

Accepted Answer

For vendors who enhance guest experience but don't generate direct revenue (like a great DJ or a decorator), you can use more abstract metrics. One method is to tie their value to survey results. For example, if a DJ consistently gets rave reviews and boosts your 'Overall Experience' score, you can assign a value to that improvement based on its impact on client retention or future bookings.

Question 3

What is a good ROI for a vendor?

Accepted Answer

There's no single answer, as it depends on the event and vendor type. However, a good starting point is to aim for an ROI of at least 100% (meaning you get $2 in value for every $1 spent). For high-risk or high-effort vendors, you should aim for an even higher ROI to justify the investment.

Question 4

Should I share the ROI calculation with my vendors?

Accepted Answer

It can be a powerful tool for negotiation and partnership building. If a vendor has a high ROI, you can show them data that proves their value, justifying a long-term contract. If the ROI is low, you can use the data to discuss ways to improve performance or negotiate a lower cost for the next event.

Question 5

How does this differ from the 'Wedding Package Profitability' calculator?

Accepted Answer

The 'Wedding Package Profitability' calculator looks at the overall profit of an entire event package from the planner's perspective. This 'Vendor ROI' calculator zooms in on a single component—a specific vendor—to analyze its individual contribution to the event's success. It's a micro-level analysis, while package profitability is a macro-level view.

Vendor ROI Calculator

Results

Understanding Vendor ROI

Frequently Asked Questions

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