Tis the season for graduation parties, weddings, family reunions, company picnics and more. Perhaps when choosing a venue you discovered that some have “preferred” vendors they expect you to use. But is it really a preferred vendor or is it a required vendor? Though the meanings are different, some people use them interchangeably in an attempt to soften the fact that your choices have been limited.
To “prefer” means to give priority to, to like one choice more than another. When a vendor or venue says they have preferred caterers, photographers or musicians, they may mean that they like to work with those people, but you may be able to choose someone else, often for a fee. A venue that refuses to allow you to choose another merchant in reality is saying their “preferred” vendors are “required,” not preferred.
Venues create preferred lists for several reasons. They may have had a bad experience with certain vendors in the past, so they recommend people they have screened and trust. They may have an agreement with the vendor, perhaps a caterer who agrees to clean and remove trash in exchange for being placed on the preferred list (a form of free marketing). Or it could be that the venue is receiving a percentage of what you pay the merchant, in other words a kickback. That most often occurs when you are required to use a certain merchant with no exceptions, rather than having a choice.
Businesses that solicit kickbacks violate consumer protection laws if they don’t disclose what they are doing somewhere in the fine print in their contract. Booking a venue that solicits kickbacks may increase your costs. The merchant will charge you more to cover what they have to pay out.
The next time you are told you must use a preferred vendor, take time to find out why and run the numbers to determine whether booking that venue is in the best interest of your plans, your pocketbook and your ethical standards. If you love a certain caterer and are willing to pay more to use them, great. If, however, you are forced to use a vendor that will cost more in the long run and may not provide exactly what you want or need, you may want to look elsewhere.