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What are the Event Budgeting Basics?
As with anything in life, if you plan on spending money on something, you should first think of how much you are willing to spend and what you expect to get for it. An event is no different so when planning an event, considering the event budget is critical as no one is going to have an open budget or give you a blank cheque (oh how I wish that was the case…LOL)!
At first, it will be difficult to come up with an exact figure however an initial rough estimate is a good place to start and then with some research on market rates for various elements, you should be able to arrive at a more accurate and realistic number.
If you end up with a number that is too high, you can always check if there are lower priced alternatives or if certain items can be removed. Importantly though, make sure that anything you remove doesn’t affect the overall quality of the event. If it does then scrap the whole event idea as there is no point in doing a badly put-together event. Another alternative is trying to share the cost by approaching sponsors or getting into a partnership with another company who may have similar event goals as you.
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Drawing up a budget serves a very important factor. It will help you analyse whether spending this amount of money will generate enough return on investment (ROI) because let’s face it if you just spend money and not get anything in return, what is the purpose in doing such an event?
There are two main categories of costs that would come up, Fixed Cost and Variable Cost. Some fixed costs would be like venue rental, the design and décor of the venue, cleaning costs, insurance, technical equipment, etc. Items like food & beverage, number of support marshals, etc. would be types of variable costs as they would depend on the number of guests.
After you have all the budget lines in place, don’t forget to add in around 10% for any small unforeseen expenses that are bound to come up. Like did you consider the cost for waste disposal, did you factor in the VAT for all the taxable items or if you need to hire additional staff to ensure the venue is clean throughout? Even when we think we have considered everything possible, something will come up at the last minute, trust me!
To help out, have a look at our comprehensive Event Budget Checklist. It is possible that you may not require all of the elements for every event so you could filter which expense lines are required for your specific event type.
Final Thoughts: Always remember if you fail to plan, you plan to fail. Do the initial legwork getting an accurate budget in place before committing to an event so you can know that the ROI will be worth it.