How to: Budget Effectively For Your Event
Budget management is an essential part of planning any kind of event. Not only will it help to keep you on track, but it will also allow you to set realistic expectations for what your event will look like. Our best tip would be to create a timeline to help you forecast which costs will be coming out when. A tool like this will be really handy to look back on when you are in the throes of event planning as it will highlight where costs are higher than predicted and where you can make cutbacks. Whether you are a first-time planner or an absolute pro, we've put together this guide to help you through all the considerations you might have during the process of budgeting, and most importantly a few notes on how to get the most bang for your buck.
A few things to consider:
What type of event are you trying to put on? Is this event for charity, for profit or is the plan to breakeven? These factors will hugely influence the model for your budget and what can be afforded. It is also worth considering that if you are putting on a charity event you may be able to get official accredited sponsorship for things – as long as you have a registered charity number.
Ticket prices. This is a deal breaker, as not enough ticket sales will mean no event, so this is a good way to cover your upfront costs. If the event is a free one, have a think about the initial budget and what your markers of success will be.
What are your expectations? It is important to be realistic with what you think you can achieve. If this event is launching for the first time, are you going to be able to secure those world-class speakers and delicious food for a cut price? Think about the realistic scenario of what your event will look like and your budget will fall into place around this.
Have you got a contingency fund in place? There are always unforeseen costs to consider, look to put aside at least a 5% backup fund.
Prioritise what you want and what you can afford. Your event will no doubt need entertainment, but before going down the expected route of perhaps a band or some music, maybe think about having a speaker. Often a speaker can provide more value than just their keynote speech. For example, they can have lunch with delegates or run an interactive Q&A session. Have a look at our tips on getting the most out of your speaker.
Think about what type of event you want to put on and what your markers of success are
First things first…
Create a spreadsheet for your revenue and cost figures. Keep these in separate tabs and add in absolutely everything you spend, this will be essential in the long-run, even if it seems a little arduous
Work out at which point you will have broken even, this will be a marker for almost everything. It will designate your ticket prices and govern all your other costs.
Group your costs and revenues into separate categories and map them out into timescales. You may be in the lucky position of having more revenue than cost, however, are your costs coming out before your revenue is going in? These timescales are important factors to be aware of.
Break down your costs. For example, don’t lump venue into one category – it can be split into room hire, staffing costs, catering and so on. There may be VAT to pay on separate items so it is always important to categorise these correctly.
Planning the actual budget
You may be working in a team, but we would always suggest designating one person to solely look after the budget. Then they can be responsible and accountable for managing the finances for the whole event.
Put someone in charge who is not afraid to be ruthless. While the creative team may have their hearts set on a certain type of centrepiece, leave it to the budget manager to make the final call. If it is too expensive and going to compromise the whole event, then get rid of it.
Factor in how things are being paid for, if they are being paid for cash, then you will have to count this money after the event and it may delay proceedings if you need things to be paid for. If you are paying for things on card, is there a charge to use the card machines and will this be deducted off of your final profit?
Don’t be afraid to negotiate, especially if you are spending a lot with one supplier. If you are giving a lot of business to one place, this puts you in a good position to get the best price for your event.
Above all it is important to remember that your event budget can be planned in the same way as you’d plan your own monthly budget. There really isn’t much difference to the underlying principles. Get down the critical elements and the rest will eventually fall into place.
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