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10% Kick back - REALLY??!

post #1 of 5
Thread Starter 

So this local banquet facility wants me to be their preferred vendor.  However, they want 10% of whatever I sell the cake for.  How common is this?

 

I am a preferred vendor for a well known hotel and they don't ask me for such thing.

 

This banquet facility is privately owned and my gut is telling me these people are money hungry.  I am actually put off by the fact that they ask this knowing that as artisans we don't make huge profits and work very hard for what we do make,   I actually find this insulting....please let me know what you think.

post #2 of 5

Typical banquet hall....  They'll try whatever it takes to make a buck.

 

You can raise your prices 10% to cover the kickback, but that's a decision not to taken lightly.

 

You can also throw the ball back to the bqt facility and ask them to guarantee you "X" amount of business per month for earning their "commission".  That's a nice way of telling them to (blank) off, because they will never guarantee such a thing.  Still it's a nice way of getting out, gives you a little respect.

...."This whole reality thing is really not what I expected it would be"......
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...."This whole reality thing is really not what I expected it would be"......
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post #3 of 5

Foodpump is exactly right; a facility who wants a percentage isn't interested in quality as job 1; they'll push you as long as they can get their kickback, until someone else offers them 12%.  I like his approach - to ask for a guarantee; because they can't (unless they are booking the cake and you are invoicing them and they in turn charge the client a higher cost).

post #4 of 5

Tell the banquet facility no problem that you will just amend your contract to show the additional 10% separately and with the amount payable directly to the banquet facility in order to keep your tax structure and paperwork less complicated. That will probably make them reconsider because it will disclose them as the money grubbers they are.


Edited by cheflayne - 4/27/14 at 10:49pm
Wisdom comes with age, but sometimes age comes alone.
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Wisdom comes with age, but sometimes age comes alone.
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post #5 of 5

If the hall generates a lot of business then it's a matter of whether or not it's worth it to you. Food manufacturers pay supermarkets a kickback of sorts for preferred eye-level shelf placement. The increased volume more than covers that expense.

 

Most halls with preferred vendors have several good ones to chose from. Like it or not, it's pay to play capitalism.

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