The beginning of the year is a great time to plan and review your upcoming event budgets. Clients often aren’t sure where to begin when looking at how to create an event budget. Even the smallest oversight in budget planning can make a large difference to the end result.
What is an event budget?
An event budget is an outline of the estimated costs involved in running an event. This includes factors such as venue costs, cost of goods, advertising and supplier costs to name a few. The budget also needs to take into account the amount of hours spent on the planning. Generally the event budget is the final amount allocated to the project. When looking at how to create an event budget, adequate time must be spent ensuring that it includes all required elements for event success. Event Budgets are generally compiled at the same time as the event objectives. These objectives determine which areas of the event are needed to ensure return on investment (ROI). Following an event, it is best practice to review the actuals of the budget. You should note any substantial differences in your debrief.
Key Elements of an event budget
1. Travel and Accommodation
Multi day conferences, incentive trips and roadshows are examples of events which have travel and accommodation costs. These costs include flights, hire cars/Uber/Taxi, accommodation, tips etc.
2. Venue Hire
Venue Hire is often one of the largest ticket items in your budget and it encompasses many elements. These include room hire, front of house staff, security, AV supervisors and many more. Some venues quote each cost separately. While other venues wrap them all up into a package such as a Conference Day Package (CDP). You should always read the quote in full as some venues have the extra items (such as security) written into the fine print. These costs often aren’t added to the event cost until the final invoice.
3. Audio Visual
Audio Visual is another element which can be a big ticket item. Depending on your requirements, audio visual costs can climb quickly. Thus you need to have an accurate allowance for them in your budget. Some venues may include a small amount of AV in their CDP, others need you to hire everything. Some venues allow you to bring in your own AV and operators, others make you use their preferred supplier. You will need to have a good idea of how you want the event to run to get an accurate quote. Think it through beforehand and allow a little extra for elements which pop up on the day.
4. Food & Beverage (including Per Diems)
As mentioned in Venue Hire, food may be included in your CDP or it may be quoted separately. When looking at a budget for the food portion of your event you need to have some information prepared. Your expected number of attendees and which meals you will provide are needed to determine costs. Some clients decide to hire the venue as room only as their event may be only a few hours and not across a main meal time. Others decide to ask their delegates to source their own lunch from nearby outlets. Some important things to note when compiling the food budget are:
*Event timings. When deciding to allow your delegates to leave and source their own food, you need to ensure that your break timings allow for this. If it is only a short break you may be better to provide your delegates with a “working lunch”. Otherwise you will lose them and they will likely be late back to the session.
*Food and beverage habits. If you know that your group is very health conscious or follow a certain religion it is best to discuss the dietary requirements with the caterers upfront. Some may charge extra for certain dietary requirements. It’s also important to know whether your group are big drinkers. If they are you may be better off budgeting for a beverage package rather than on consumption.
*Launching a new food or beverage item? You will want to discuss this with the venue upfront. They may need to give permission for you to serve the item. Depending on what it is you may not need as much other catering.
*Per Diems. Ensure you include any per diems that you need to pay your staff if they are travelling for the event.
5. Labour costs (including in house staff)
This is an area of the event budget that many people forget to include or don’t adequately allow for. Each hour that your staff are spending on planning and attending events is an hour that they are not spending on their regular job. These hours and their corresponding costs need to be accounted for. Including these costs ensures that your ROI is accurate. Ensure you include any staff that are attending the event as well as those planning hours in the lead up.
6. Logistics (including any council approvals, special approvals etc)
Logistics for an event is quite a broad category. It can include any special approvals you may need and licenses that are required. These licenses and approvals can be for a range of reasons including:
*Public Spaces. If you are looking to use a public space for your event you may need to source approval from the local council.
*Pyrotechnics – if you intend to use any fireworks and effects for your event you will need to source a permit to do so. Link for NSW permit.
*Food Licenses. The caterer or food truck you use will need to have a license to show that they have the appropriate training.
*Working with Children Check. If you have children attending the event it is best to ensure that the staff and suppliers have appropriate working with children checks. Working with Children check for NSW can be found WWCC NSW
*Insurances. Some events will require special insurances. This is also where you include any event cancellation insurance or public liability insurance costs.
7. Registration Costs
Registration is a complex part of any event. Depending on how you choose to register attendees, you may have some costs involved. For more complex registrations, an event registration system may be required. Some suppliers provide this on a per ticket cost and others are an annual subscription.
If your registration is more simple, then an event registration system such as Floktu, Eventbrite or Humanitix may be a good option. These systems generally charge a per ticket fee for use of their system. If you decide to not use a system and instead use email RSVP etc, then you need to include the time spent coordinating the RSVP’s. Note – this can be extremely time consuming.
Another element of registration costs is the actual registration set up on the day. You need to think through how you would like this to work. Will the attendees will have lanyards, name badges, swag bags? Printing costs also need to be included in this step. This includes badge printing onsite if you choose to do this. You also need to include the hours spent registering attendees.
8. Transport Costs
Transport costs will vary depending on the layout of your event. At a minimum you may have taxi/Uber/hire car costs for the staff and speakers attending the event. If your event involves multiple locations or your delegate hotel is not walking distance from the event venue you may need to hire coaches or hire cars. The best way to ascertain what you will need for transport, is to walk through the event in your head. Where are people going? How are they getting there? If your hotel isn’t walking distance to the venue you may need to allow for multiple speaker transfers. Most speakers will want to prepare in their room rather than spending the full day at the venue.
9. Marketing and PR
How are you going to promote the event? You can have the best planned event in the world but if no-one knows about it, it will be a fail. Events are promoted in a number of ways. The best way to choose is to think about which forms of communication your intended audience are likely to use. The costs in this section may include using an agency to promote, advertising costs, PR stunts/activations, the invitation style you choose to use. The list goes on.
10. Any giveaways/gifts
Attendee swag bags, speaker gifts or prizes for competitions run during the event. These costs all need to be included in your event budget. Promotional items may also have a long lead time. If your event has a short turnaround you may need to include additional costs to expedite freight. Freight costs are an important element to include in this section. You will need to get the items to the venue and if there are leftovers how will they be transported back to the office? Time spent packing swag bags also needs to be included here. Remember it usually takes longer than you expect it to so allow extra time!
11. Event Management agency charges
For more complex events or for circumstances where you don’t have an event trained staff member, it is a good idea to enlist the help of an event agency. This is their day to day job and as such most tasks completed by them will be done in much less time than someone who isn’t in events. This is an important thing to remember. Whilst your staff members hourly rate may be lower than the agency charges, you need to take into account the amount of time the staff member will take to complete the tasks. You also need to include any leave entitlements that are accrued by the staff member. Some agencies will charge a flat rate fee. Others will charge depending on final number of attendees. This is something you should discuss with your event company when planning your budget.
12. Supplier charges – photographer and video etc
Another important element of any event is suppliers. These items are often afterthoughts and not catered for in your initial event budget. It is important in the event budget planning stages to think through what suppliers you may need for the event and include them in the budget. Examples of suppliers include photographer, videographer, printing, temp staff, generator hire and fencing.
13. Contingency Amount
Even the best planned event budgets will have something unexpected pop up. Therefore it is important to include a contingency amount in your budgets. The amount of contingency needed will vary depending on your overall event. As you approach the event, you can review the budget to see if the contingency will be required. If it isn’t required you can choose to leave it as a saving. Alternatively you may decide to use the money to add something to enhance the event.
As you can see above there are a number of elements that need to be considered when looking at how to create an event budget. You need to ensure that you have properly planned and considered all sections of your event to ensure the budget doesn’t blow out. It is also important to regularly update the budget document with actual figures. This allows you to see clearly how much you have left to spend in each segment and whether you are on target. This will ensure that at the conclusion of the event you can see any areas that may need more (or less) budget for future events. It will also identify any areas that weren’t considered. This assists with determining the events ROI.
If the above all looks like too much work or you aren’t sure how to create an event budget please contact us at Events Outsourced. We have flexible plans and pricing. This means you can have us assist with one section of the event or look after the whole event for you.