Supplier-Partner Relationships In Events: In-House vs Third-Party

Ding, ding ding, it’s time to talk about supplier-partner relationships in events! And this is, of course as an AV company, is a topic very dear and near to our hearts. When it’s time decide between in-house and third-party, who will win? Is there a better option at all times? Or does it depend on specific situations? We’re sure these are all questions that have danced around your mind at least one time. But because we’re all about answers, this juicy episode of Event Brew will do the best to help you out.

This is one of those times where having four spectacular hosts with different backgrounds and experience comes in handy. Will Curran, Nick Borelli, Thuy Diep, and Dustin Westling all have something to say about the topic of supplier-partner relationships in events. Things are about to get a little heated but in the best possible sense. Grab your drink and let’s get brewing!

Click here for the full audio transcription.

Supplier-Partner Relationships In Events – What’s Up?

For those of you who don’t know, Will owns a third-party AV company, Endless Events in the flesh. “I think the most contentious relationships of a third-party AV company is one with an in-house, preferred AV company”, he begins. “So, if I had to pick a side, I’m obviously pro-third-party AV. Because I am a third-party AV company. But I, definitely, am just a fan of planners having a choice. And I think that in-house companies should compete like the rest of us. I’ll say that out loud”.

Looking At In-House

Nick has definitely been around. From venue management to third-party and in-house AV companies, he’s seen it all. “I will say that when it comes to the venue, I can see their point of view. It’s their house. They want to protect it. They want to be able to know and have leverage over the people that are in it. And they want continuity, simplicity, cohesiveness. There’s a lot of value to a uniform partner from the vantage point of the venue itself”, he says.

“Now, I can poke holes on that”, continues Nick. “I can say that some of the jobs that you get, because you get all the jobs, are not meant for you. That you shouldn’t have because it’s not what you’re passionate about. The price point might be something that you might not want. So, it’s not necessarily just what’s good for the planner or what’s good for the attendees. There are also things that the clients that really shouldn’t be your clients because you just don’t mesh”.

Preferred Partnerships

Dustin owns a design and production company. This means that they are preferred suppliers in quite a few venues. “It’s a big deal for business and the relationships are often complicated. And they’re often really rewarding. And, to Nick’s point, you do end up taking a little bit of everything”, he explains. The company works with a lot of big venues, “so some of the benefits that we get to bring to them is a working relationship and knowledge of the venue that a third-party would struggle with a little bit”.

“When our teams know the names of every single person that works in that venue and what everybody does, it makes the work so much easier for our clients, for us, for the guest experience. Knowing what the capabilities of the venue are is also really important. So that we’re not pushing our venues to do something that is not in their wheelhouse. Or we can better prep them to step out of their comfort zone, knowing where their skill set is”, continues Dustin. “And then, I think for on the venue sides, creating some consistency in the services that they’re offering and being able to back them up, has been really important for our best relationships”.

Supplier-Partner Relationships In Events Aren’t Black & White

Will makes a good argument in contradiction to Dustin’s perspective. “I think one of the things I hear all the time is that like we have a working knowledge of the venue that no one else does”, he says. “At what point, though, is a ballroom, is a ballroom, is a ballroom, is a ballroom? It’s four walls. And, yes, maybe it has a little different of a crown molding. But, I always get frustrated when I hear, “Oh, well, they know the venue way better than we do”. And, “Cool. It’s a box”.

Dustin does understand Will’s point. However, he goes on to add that “I do know that venue better than you’ll ever know it. Because we spend a lot of time in it, and we know all the little idiosyncrasies of it. We know what works, we know what doesn’t work. We don’t have to spend the same amount of time discovering that somebody that, maybe, does two or three shows a year in there does”.

Relationships Go A Long Way

“There are some jobs where being in-house every single day makes a huge difference when it comes to understanding the expectations, especially when it comes to the venue”, says Nick. “So, the venue has very specific expectations of what you can and can’t do. And, there are the idiosyncrasies that are more on the line of what we expect at the level of it, and we don’t have to worry about it. So, the house protects itself by aligning itself with long-term partners to be able to do that. There are all these different players at stake. I do believe that choice is something that is into the planner and if there’s not a planner, if it’s a social event, the end clients will always benefit from having the most amount of choice. As long as they understand the full weight of the choice”.

Supplier- Partner Relationships In Events Affect Everyone

Nick adds that when it comes down to supplier-partner relationships, “there are a lot of people “at odds” with each other. There’s the end client, there’s the planner, potentially, if it’s not the same thing. And there are the suppliers being able to provide what they do in a unique way. And then, there’s the venue itself”. Thuy agrees on this point, adding that “it’s so diverse because it really hits everyone. From the planners to the hoteliers to the third-party planners, suppliers. So, it’s not just AV and venues. Caterers, photographers, everyone is affected, or has dealt with this at some point”.

“If anything, because we are the event industry, it’s the relationship that you build. Can I trust you to partner with me on this? That’s something that’s important. In regards to, do you force recommended versus in-house? Definitely, I like to just be incentivized”, she continues. “So, for me, it’s not just the same thing over and over again. I like the option to pick. Maybe there are some clients, or there are some programs that I might not mesh with. I like that mixture and being able to pick and choose”.

Thuy goes on to add that she has a handful o preferred partners. “But, am I locked in with them? No. And, I think that’s the beauty, when it comes to designing for certain clients and certain programs is, do I have friends that are competitors? Absolutely. But, am I going to pick them because they’re my friend? No, I’m really going to take a look at what the objective is, what their budget is, who they are, why they’re even here”, she concludes.

The Misconceptions

“I think that there are a lot of misconceptions as far as the relationship that people think that these exclusivities often have”, chips in Nick. “I guess the negative side of it is that it’s all about money and payola. And it’s at the heart of business deals and not caring about the client. I’ve seen a bunch at different sides of this and I would say that I’m sure there are instances where corners are cut. But in my experience, more often than not, people protect themselves and their relationship with their clients first and foremost. And then, the payola aspect of it, the percentage that they get is second to that. But again, I don’t know necessarily know if the expectation of that or the thought of that, from people, is always that that’s the case”.

Dustin adds that he gets “really frustrated when there are assumptions about the partnerships that I have. It doesn’t matter where you hire us, you get the same pricing. It doesn’t change from venue to venue. Of course, there’s an agreement with the venue. Of course, there is money that changes hands there. Every venue has a different partnership. And, for us, it’s about, we pay for the referral and it’s the cost of doing business”.

He goes on, adding that “it doesn’t mean that it’s more expensive for you to use us when we’re in-house. And, it definitely doesn’t mean that you’ll get it cheaper when you’re somewhere else. We do protect those relationships, and we don’t screw around with them. And we work just as hard, if not even a little tiny bit harder. Because we have two clients in the room, we have our venue client and we’ve got the end-users. So, it keeps us on our toes because the relationship is so much bigger than that show that we’re working on right then and there”.

Assumptions, Assumptions…

Will adds that “people shouldn’t assume that because you’re in-house, what your pricing is. The same way that people shouldn’t assume the fact that our company doesn’t own any equipment, that we’re always more expensive. It’s about the efficiencies of the business and their ability to figure out how to make a margin. And, I think one reason why in-houses get bad reps is that there are companies that are getting greedy that are giving away larger and larger percentages of commissions. And so, they have to charge way more”.

Additionally, Wills admits he changed his perspective now. “I used to say is that the in-house actually has it easier. Because you’re getting handed business, and there’s always a deal coming around the corner and things like that. However, one interesting thing is that you have to impress a venue so much because you’re a preferred partnership. So, technically, the client can always decide to not use you. And, I think that’s a really, really interesting”.

“There are a lot of different financial angles to it as well”, adds Nick. “But, ultimately, I think that the idea that some kind of compromise between the balance of being able to hold people accountable and to understand the venues, or professionalism. Because there’s such a low barrier of entry in our industry anyway. So, that’s where the fear comes in from a venue standpoint”.

Supplier-Partner Relationships In Events – What Grinds Your Gears?

“So, I wanted to bring up a very specific, timely issue that we’re starting to see in the AV industry. And, obviously, this comes into many other relationships”, says Will. “For years, in-house companies have had their own preferred rigging companies. Those are the people that hang the stuff on the ceilings and suspend all the stuff. Well, for the longest time this has been exclusive. I’ve come to accept that for, liability reasons, it makes sense to allow the company in-house to do it. Everyone’s calmed down on pricing. I haven’t seen anything absolutely egregious quite yet, but occasionally it pops up, but most people are really, really willing to flex on it and be flexible when it comes to everything”.

“We’re starting to see globally, as well, that in-house companies are now no longer making it. Obviously, that they’re only required to do the rigging, but also that the in-house is required, forcing you to use them for ground supported trusting systems. Or charging you if you want your third-party AV company to bring ground supported systems. This obviously creates a huge conundrum in the AV world because you used to be a solution to saving clients money, is now a no-choice for them to be charged more money”, he concludes.

Deep Into Exclusivity In Supplier-Partner Relationships

“You don’t hear a lot about compromise because it doesn’t make business sense sometimes to only do things longterm. But, I’ve seen exclusivity work, I’ve seen exclusivity absolutely fail. It’s not a silver bullet. And it’s not the right thing for every venue. It’s not the right thing for every planner. I think that anything that gets in the way of having the right people work with the people they were meant to is a problem”, says Nick. “And again, I understand the liability aspects of it and the training. And I’m not saying that they’re not well-trained, but there are all these pitfalls in working with that type of organization. So, it’s give and take”.

Nick also adds that “ultimately, I think that it’s one of those things as a planner you really need to consider. What do you value more? And, I think that there are absolutely amazing third-party options in a lot of cases that are more creatively-driven, let’s say, and also meet all of the bare minimums. And then some, for things like security, that would make me want to, if I was looking for creative solutions, the challengers have a distinct advantage over. That said, on the creativity part, it just depends on where you are on the spectrum of caring about the creative versus the ease of use”.

In-House vs Third-Party: Who Wins?

When it comes to supplier-partner relationships in events, who wins? “It is a tough one”, says Dustin. “And, I think there’s a lot of in-house, preferred partnerships out there that work really hard, are really great companies that get a bad rep for having the business acumen to build these great partnerships”. Nick agrees that it’s hard to decide which option should be considered best.
“Because oftentimes people see a spectrum that is binary of you’re either an unfettered creative institution that is maybe not as large and therefore, because of that has more freedoms. Or it’s the side where the bias comes in and saying, “Well, you say that you know this venue really well, and you really know the eccentricities of it. And you really know what it can do. It sounds like you have a mindset of what this should be already before we even talk”.

In the end, the opinions of our hosts are split when asked which relationships work best. For clients, Dustin and Nick say preferred, and Will says open. For the attendees, the same. And for the venue, Will sticks with open and Dustin and Nick go for in-house. Who knows if they’ll change? Stick around, you might get the scoop if they do!

Conclusions

And that is a wrap on another amazing episode of Event Brew! This time around we went all-in with supplier-partner relationships. What is your take on that? Which relationship do you think works best for your business? Make sure you let us know, and don’t forget to tune in next week for more exciting brews!