Corporate events involve big budgets, and even bigger expectations. As an event specialist, your job is to make sure that your client gets the most out of their investment. Being responsible for a substantial budget can be downright terrifying – that is if you’re not taking the following crucial considerations into account. If you want to ensure that every single cent goes towards positioning your client in the best possible light and creating a world-class event, read on for the non-negotiables of event budgeting.

Accurate event budgeting relies on preparing for every possible scenario.

The old Boy Scout mantra: ‘Always be prepared’ rings true for event managers in particular. If you’ve forgotten to include contingencies for last minute emergencies, your event is unlikely to result in ROI. Having to ask your clients at the eleventh hour for additional money to cover the cost of hiring a generator, due to yet another Eskom failing, is unprofessional. Fortunately, it’s entirely avoidable. Including a contingency of 10% is imperative. Remember that if you allocate a portion of your event budget to ‘emergency proofing’ an event, this doesn’t necessarily mean that this money will be spent, but in the case of a power outage or strike, you’ll have the means to deal with the situation. If your function has gone off without any hiccups, always produce a full recon and be honest about any left-over funds. Failing to do so will only result in a black mark on your reputation.

Reconcile your budget within 24 – 48hrs after an event to ensure accuracy.

It’s not uncommon to leave the reconciling of your event budget to the last minute. After all, planning and executing a high-profile event is exhausting, which means the last thing you feel like is crunching the numbers. However tempted you might be to delegate this to the bottom of your to do list, it’s imperative that you tackle the breakdown of your event budgeting as soon as possible. This safeguards against losing receipts and forgetting to include last-minute purchases. An accurate budget breakdown isn’t only crucial for your client, but for you too.

Smart event budgeting entails negotiating with your suppliers.

Making sure that your budget adequately covers every single element of your event requires a strategic approach. Be savvy when it comes to choosing a vendor. Negotiating a reduced rate from suppliers with whom you have an established relationship allows you to reduce your costs without having to compromise on quality. The majority of suppliers require a payment of 50% of the total amount upfront, with the remaining 50% paid after a function. Many vendors will be open to granting you a discounted rate if you pay them the full fee upfront. If you do get a rate that’s less than your event budgeting forecasted, always be honest about this saving with your clients. In a cut-throat industry, transparency and trust go a long way in establishing yourself as a professional event manager.

Be aware of the ways in which your carbon foot print impacts your event budgeting.

Many planners don’t give a second thought as to the origin of their supplies. Failing to do so often results in spending more money than necessary. If you’re organising a benefit or charity event, don’t import Scottish salmon when locally caught trout will suffice. Be environmentally conscious about every single detail. This includes (among other things) your lighting – LED lights are just as effective as their energy-wasting traditional counterparts, as well as your centre pieces – opt for re-useable plants instead of cut flowers. Besides being an efficient way of cutting down on your budgetary requirements, positioning yourself as an eco-conscious event organiser is a quality that’ll be admired by your clients too.

Transparency is key throughout all aspects of event budgeting.

At the end of the day, corporates want to see how their event translates into numbers. Besides having a detailed breakdown of every single expenditure, being transparent about any left-over contingencies is imperative. It’s far more profitable to pass back a saving of say, R2000, than to keep it and risk being found out. Don’t put your reputation on the line for pocket change. Event planners who are honest about their budgets enjoy the benefits of repeat business from clients.

Your approach to event budgeting is a crucial. Be meticulous about every aspect – from keeping receipts, to researching your suppliers, to timeously compiling a breakdown of expenses. Corporate events involve substantial budgets that require the utmost attention to detail and professional handling throughout.

Image Credit: Best Finance Network

Compiling an accurate budget can be a precarious endeavor – after all, the success and profitability of your event hinges on a precise calculation of costs. Unfortunately, budgeting for events continues to be an aspect that many event managers struggle with. Whether due to time-constraints or unreliable suppliers, budgets end up being based on ‘guestimates’ – and ultimately end up adversely affecting and event’s ROI. The next time you’re faced with creating an event budget, keep the following in mind:

Transparency is key

In our experience, creating a budget that is transparent goes a long way in building a client’s trust, and as a result, their willingness to do businesses with you. A transparent budget is one that shows actual costs from your various suppliers, with your management fees listed separately. While it may take some additional time and effort, the benefits of establishing accurate prices instead of merely guessing them are considerable.

Being greedy doesn’t pay

The largest portion of a budget generally goes toward the hiring of a venue and catering costs. Smart event budgeting relies on a mark-up that won’t put your clients off, but will also ensure your event is profitable. An unreasonably high mark-up doesn’t just look greedy, it’s unprofessional too. If you’re unsure as to whether your increases are reasonable or not, work out your cost per head. Do this by dividing the number of guests by the total cost of the job. If the cost per head is too high, you may be at risk of losing the job.

Use industry standards as a guideline

All event managers have differing ways of calculating their mark ups when budgeting for events, depending on the size and nature of the event in question. The general consensus is that a rate of between 15% and 25% is advised -depending on the value of the event. The more expensive an event, the lower the mark-up. Another method of conducting your event budgeting is to mark up each item (e.g.: catering, venue, entertainment, staff, gift bags, etc.) individually. Some items will carry a higher mark-up than others, depending on their value.

Don’t let hidden costs trip you up.

It’s an all too common occurrence – you’ve meticulously planned an event from start to finish, and done it within budget to boot – when you realise you haven’t accounted for the crew’s catering. Extras like daily stipends for staff, transport costs and event insurance can end up blowing your budget off course. Make sure to take pre-production time and its resulting costs into account too. When it comes to budgeting for events, there’s no such things as being too meticulous.

Be an expert record-keeper

There’s nothing more infuriating than having to pay for a last minute event purchase out of your own pocket, due to not having a receipt or record of the transaction. Avoid this by having an order book on site as a record of your client’s acknowledgement of additional budget requests. This will safe guard against losing money and also serve as a written record that can be included in your final budget recon. Make sure to collect and file all receipts for future reference so that you and your client have a complete record of every single cost involved.

Budgeting for events doesn’t have to be a dreaded exercise. An accurate budget benefits not only your clients, but your event management services too, so approach this endeavor with care in order to ensure all parties profit.

Image Credit: Times Live