by Michael J. Shapiro | September 01, 2014
The Butt-Saver
One key budget-saving tip, according to Susan Losurdo, CMP, of Global Meeting & Event Management, is to "always build in a line item that I call 'contingency,'" says the Greenville, N.C.-based planner and budget expert. "It's simply a bank of money that sits there should you have the need for emergency funds. I've used as little as $500 and upward of a few thousand -- the more unknowns you have, the larger the number. I sometimes refer to it as the 'butt-saver' line item."

For Greg Jenkins of Bravo Productions, a contingency fund of at least 10 percent is logical whenever he's working with a budget that his client put together. "For example," he says, "it just rained here in Southern California -- in August! That never happens. But you might have to secure a tent at the last minute, or hire additional staff to clean up the venue. That 10 percent would cover whatever last-minute adjustments you have to make to account for the unknown."
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Even a carefully crafted budget can balloon out of control, as seasoned meeting professionals can attest. M&C asked planners and suppliers to share the common mistakes they've made or witnessed, along with strategies for avoiding similar snafus.

Rash pricing. "Too many times a planner will take the estimated food-and-beverage cost presented at the proposal stage and build the registration fees from it," says Katie Allen, director of catering and event management at both the Sheraton and Westin Kansas City (Mo.) at Crown Center. "They don't give an allowance for additional F&B, such as coffee breaks, that they might have failed to build into the RFP process."

Overselling and underspending. The error here is in the way F&B might be marketed to attendees. For example, says Allen, "putting 'breakfast' on an agenda but ordering a finite amount of just coffee and Danish will almost always lead to unhappy attendees who came hungry with the expectation of getting something more substantial."

Dinnerless cocktails at dinnertime.
 "Planners frequently don't anticipate heavier consumption at receptions between 6 and 7 p.m. that aren't followed by a dinner," points out Gary Collins, director of association sales at Silverado Resort & Spa in Napa, Calif. "This is their dinner."

Suzanne Halperin, senior director of operations, catering division, for San Francisco-based Kimpton Hotels & Restaurants, adds, "You might cut your allocated costs a bit, thinking it's 'just' a cocktail party and not a three- or four-course dinner. But these receptions can cost more because you'll need to have a variety of choices, and enough stations and substantial food, to ensure that people leave satisfied. The last thing I want is to have someone leave an event and have to go out to McDonald's. Plus, attendees tend to get more intoxicated when there isn't enough to eat."

Old-fashioned pricing. F&B budgets frequently are developed based on pricing from old menus, points out Gary Collins, or without adding at least 5 percent per year for future events.

Underestimating drink consumption. "It is hard to budget accurately based on consumption," says Halperin. "You might assume, 'Oh, this isn't going to be a big drinking crowd,' but think about it: Every time someone sets a drink down because it's getting a little watered down, they'll likely order a new drink a few minutes later. Sometimes it's better to get the bar package; that way you'll know ahead of time what you are paying."

Per-piece purchasing. Greg Jenkins, a co-founder and partner of Bravo Productions in Long Beach, Calif., had one client who decided to serve jumbo shrimp as an appetizer at an opening reception for 3,000 people. The shrimp cost $5 per piece. "The guests ate them like they were M&M's," recalls Jenkins. "In the first hour, they had gone through all of them. We asked the client if they wanted to order more shrimp -- which they did. But in the end, they saw the bill and said, 'We should have just killed the shrimp.' For the following year's event, they moved away from per-piece pricing, and there was no shrimp. There were a lot more cheese platters."

Short staffing. "A hotel or restaurant is going to have its own staffing guidelines," says Suzanne Halperin. "But it's important that you really think about your guests and what you're trying to accomplish. If it's going to be a big cocktail party and you know this is a really big drinking crowd, communicate that information so the venue has additional bartenders or staff." Likewise, share anything you know about your group's preferences. Halperin has seen far too many planners fail to provide fair warning for labor-intensive drink preparations. "Especially with the mixology trends," she notes, "an all-mixed-drink crowd will require more labor than primarily beer and wine drinkers."

Budget Illustration: ©