Meetings & Conventions: Planner's Portfolio November
Back to Basics
By Martha Jo Dendinger, CMP
BUDGETING FOR A SPECIAL EVENT
How to anticipate costs and keep spending from spinning out
While some annual meetings can be planned almost by rote, there
are always those curve balls perhaps a celebratory gala or a
fund-raiser for a local charity where even the fundamental step of
budgeting can be a challenge.
The easy mistake is to assume that the formula is
straightforward: X number of people for dinner at $X a head. Many
other factors go into this equation. Three key points to
remember:Keep to the objective.Realize that revenue and expenses are different from those of
typical meetings.Curb the temptation to add unnecessary items.
WHY ARE WE HERE?
Special events can help organizations achieve objectives in many
areas, like promotion, sales, fund raising, morale building and
recognition. Budgeting effectively begins with recognizing the true
objective of the event.
Too often, managers come up with the idea for a fabulous evening
and then try to make it fit the objective. This backward approach
succeeds only if the objective is not lost in the fireworks and
excitement. Analyze the organization’s resources and history, and
choose the best way to accomplish the objective.
THE COIN’S TWO SIDES
Financial elements vary, depending on the type of special event and
whether it is public or private. Considerations include
sponsorships, ticket sales, television and radio advertising,
advertising revenue, concessions, donations and special
Additional opportunities for revenue are one major benefit of
special events, especially when the objective is fund raising. The
trick in budgeting is identifying all the major areas of expected
cost. Aside from F&B, administrative expenses and staffing,
costs for special events fall into four major categories.
•Operations. Costs arise that meeting planners
might not know to ask about. For example, many states require
permits to hold one-time events. Also, if taxable sales are
transacted at the event, temporary sales-tax licenses might be
Insurance also is often overlooked. Is the organization’s
•Venue. Many planners are used to negotiating
free or reduced rental fees for meeting space. For special events,
which often don’t require sleeping rooms, the organization will
have to pay for space. Some facilities also demand a percentage of
the proceeds or revenue produced at the event as part of their
•Promotions. Getting the word out about a
special event requires broader marketing elements than meetings do.
Radio and TV advertising can be costly in both airtime and
production. Barter deals are one way to soften the blow to the
budget. Airtime can be swapped for tickets or signage, for
•Talent. Entertainers charge quite a bit more
than most speakers do. Plus, entertainers often contract for
additional compensation in the form of dressing rooms with a
stocked refrigerator or a percentage of ticket sales.
Research all these elements, and get all the details in writing
before signing on the dotted line.
DO THE MATH
Often, adding a menu item, souvenir or other element to the event
is tempting, especially when “it’s only $5 more per person.” Do the
math $5 per person becomes $500 more for a guest list of 100 and
$2,500 more for 500 people. Is the extra sizzle worth it? Does it
help to accomplish the objective, or does it just blow the budget?
A fancy menu only adds to cost; a menu with award winners’ names
listed on it adds to the objective.
Remember to consider trade-outs or donations when appropriate.
Also, review the budget periodically to determine if the revenues
and expenses are on target.Martha Jo Dendinger, CMP, is an independent
meeting planner based in Atlanta.
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