Category: Event Marketing
For a fledgling event company there are few things more intimidating than the process of developing a budget. Mistakes can prove to be extremely expensive, not only financially, but also in terms of the hit the company can take to its reputation if an event doesn't go according to plan. What can you do to reduce the risk of expensive errors, and how can you develop a budget that ensures all aspects of the event are properly funded?
The Guiding Principles
Before you sit down to start developing a budget, it's first necessary to create a solid foundation in terms of what you intend the event to be. In all aspects, the number one rule is realism: if you are a new company, can you expect a large number of sponsors, exhibitors, and attendees? What are you ideal figures versus your realistic figures and bare minimums?
- What kind of event are you creating? This is one of the most important items that dictates the size of your budget, and the key areas of spending.
- Are you planning an event for a niche industry or a broad industry sector with relevance to many areas?
- Who is your audience? How old are they, are they tech-savvy, do they expect luxury or bare-bones facilities?
- What kind of venue do you envisage?
- What are your expected revenues and revenue streams?
- What are your fixed costs versus variable costs?
- Any budget should include a contingency sum of 5% to 10% to account for unforeseen circumstances and problems.
With this information in hand, you can work out your break-even point: the point at which all the costs of the event are covered by the funds you receive through fees or sponsors.
Next, categorize your expected revenue and expenditures. Revenue streams may include sponsorship, advertising, delegate fees, exhibitor fees, and attendee fees; costs can include marketing and PR, event branding material, venue hire and associated fees, equipment hire, catering, accommodation, travel, and expenses and fees for speakers. This is by no means a comprehensive list; the kinds of revenue and expenses are highly specific to the kind of event you're developing.
At this point the budget can start to get complicated, so it's useful to set up a spreadsheet with multiple tabs, with one that includes category totals, and additional tabs that break down all the various revenues or costs associated with each category. This makes it much easier to see where money is coming from and where it's going, and to find those items where it might be possible to make savings. The budget should be reviewed on a regular basis and amended where necessary to reflect current costs.
Solving a Budget Crisis
There's no such thing as a budget that's too organised, and if a crisis develops, having a detailed budget can save both time and money. If it turns out, for example, that at the six-week mark revenues aren't as high as you'd hoped, a detailed budget makes it easy to see where you can reduce or eliminate costs to make up any shortfall. Having each cost itemised is a good aid for thinking about what features of the event can be considered “luxury” items, what features are essential, and where you can make budget cuts that don't substantially change the nature of the event.
Posted 27th August, 2015< Back to articles
exhibition marketing event marketing branding