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The Commission Model

Why Is AV So Expensive?

By Michael Harward, Founder, Your AV Department

There's a cost to AV that's hidden from planners, but it shapes nearly every AV quote that crosses your desk: in-house AV vendors often pay the venue up to 50% of your AV charges in commission.

That's not a small expense that can be managed. That kind of operational overhead isn't sustainable in an open and fair market.

That commission starts a cascade of costs that follows through the rest of your AV budget, even if you don't use the in-house vendor.

The Commission Reality

No company can hand over half of every invoice and still stay competitive on price. That cost doesn't disappear. It gets rebuilt into the numbers you do see:

  • –Equipment rental rates priced way above open-market value.
  • –Service charges up to 25% for which no one can really explain the purpose.
  • –Contractual penalties and exclusion clauses structured to make in-house look like the only reasonable option.

Once that pricing structure exists, it has to be protected. That's where negotiation tactics turn into contract mechanics.

The Commission Cascade

The commission cascade: up to 50% of your invoice paid to the venue as commission, an unsustainable operating cost for the AV vendor to absorb alone, inflated rates on equipment, labor, and service charges priced to cover commission, and punitive contractual barriers to make other options less affordable.

How the vendor commission drives up the cost.

The Barrier Tactic. The clearest example is internet service. Use the in-house vendor, and Wi-Fi or hardline pricing looks almost reasonable. Bring in an outside production partner instead, and that same connectivity can jump five times higher.

The Zero-Value Gap: Where Your AV Dollars Really Go Baseline AV quote Standard internet fee AV Upcharge: adds zero value Internet penalty: adds zero value Your Budget $70K $90K Internet Fee $10K Baseline AV Quote $80K $30K more than the competing bid, adds zero value $50K (competing bid) In-House AV Vendor $100K Internet Fee $10K Internet Penalty +$40K Baseline AV Quote $50K Bring Your Own AV Partner The $80K in-house AV bid vs. the $50K competing bid. $30K gap that buys nothing for your event.

Nothing about the bandwidth changed. What changed is which vendor you selected, and the contract was written to make sure that choice came with a price.

The Zero-Value Gap

Where Your AV Dollars Really Go

$80K
In-House AV Bid
$50K
Competing Outside Bid
$30K
Gap That Buys Nothing For Your Event

The Good News: These Terms Are Negotiable

None of this means the in-house vendor is automatically the wrong choice. Familiarity with the room and established relationships with venue staff have real value.

What matters is knowing the structure exists. Commission percentages, internet pricing tiers, and penalty clauses can all be raised, capped, or removed, but only if you identify them and ask before you sign the venue contract. Once the contract is executed, your leverage is gone.

The Path Forward

Understanding where your AV budget is really going, before you commit to a venue, is critical. Ask why pricing changes based on vendor selection. Get the answers in writing.

You can leverage your sleeping room and F&B revenue against these fees to keep your options open, and it can be effective.

That's the work we do at Your AV Department: reviewing venue agreements line by line so there are no artificial barriers keeping you from using the AV production partner you want to use, someone you trust.

Let's Talk

Keep Your AV Budget Manageable

If you'd like to discuss this, and other ways to protect your AV budget, reach out to me at michaelh@youravdept.com.

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