an estimate of income and expenditure for a set period of time.
"Let’s not blow the entire budget on inflatable bouncy castles."
allow or provide a particular amount of money in a budget.
"Unfortunately I only budgeted for a moderate number of inflatable bouncy castles."
Everyone budgets. Consciously or subconsciously; intentionally or by default. Everyone has a limited amount of resources and so everyone has to make decisions about how to spend their resources1. Event planners are no different. There is a finite amount of money and planners have to be intentional about where to allocate it. The question isn’t whether or not you budget. The question is:
“Is your budget a noun or a verb?”
We’re all making decisions about money but the people who are making the right decisions are those who have it in writing. Don’t just budget (verb); use a budget (noun). Putting all of the facets of your event finances on paper isn’t just a good idea. It is vital to the long-term health of your event. Nothing will kill an event faster than going way over on expenses. This is especially true in a zero-profit model when the expenses are often underwritten by an organization2. So, here are some tips that will help you move from the idea of budgeting (verb) to actually using a budget (noun).
Consider All Possible Expenses
To accurately track your possible expenses, your list of line items must be exhaustive. And the biggest expenses are the most obvious:
- Food & Beverage
- Meeting Space
- Print Materials
However, there are a lot of other possible costs associated with events that a first time planner might not initially consider. For instance, what about WiFi? Hotels, retreat centers, and convention centers can have a wide range of policies on WiFi. It can be a pay per meeting space with individual attendees on the hook for access in their rooms. Or it can be free and included in the package. Or any number of other combinations of fee structures.
And what about event insurance? Some sponsoring organizations may already have general liability coverage to which a policy rider can be added. Or you may need to seek out a standalone event policy. It’s common that venues require a Certificate of Insurance, so coverage isn’t always optional.
Another cost consideration is complimentary stays/registrations. Many youth and children’s events pay at least a portion of their chaperons’ expenses since they are often volunteers. Since the facility will still be charging for them, you will need to be aware of how many people you are comping and how you’ll make up that difference.
After you’ve created a list of possible expenses and begun to allocate your money to various categories, you will inevitably be faced with the dilemma of having more line items than available money. The process of deciding which parts of your event vision don’t get funded can be overwhelming, but breaking apart the process can bring clarity. The first step is to find your highest priorities.
What are going to be the hallmarks of this event? What attendee expectations can I not afford to fall short on? What is going to add real value for my attendees? These are the questions you need to be asking as you whittle down your short list of top priorities. If you’re still having trouble deciding, always fall back on the overall goals of the event. Having a clear understanding why you are gathering should give you some guidance as to what the wisest investment would be.
The real heavy lifting of implementing a budget is on the front end; creating, allocating, planning. However, the only way to actually make a budget effective is to track your expenses and adjust your plans accordingly. Unfortunately, many good budgets and good intentions die because there’s no follow through.
The most effective way to track expenses is in real-time. Once the dollars are spent, immediately reflect it in your budget. This allows you to check your spending and make adjustments as necessary. If you have a team of people making purchases, make sure that everyone is compiling their invoices. Using a synced or shared document makes this process infinitely easier. But even if you have to resort to inputting paper receipts, you4 will be glad that you did.
The Bottom Line
When it’s all said and done, the thing planners care about the most is seeing the event through all the way from vision to completion. However, if your organization takes a significant financial loss you may not get the opportunity to try the event again. Planning and tracking your expenses is best way to safeguard your event and build a long-term, sustainable model.
For a sample budget to get you started, click here.
1 Unless, of course, you are extraordinarily wealthy. But since you are reading a blog about budgeting, I doubt you are extraordinarily wealthy.
2 Most commonly a church, club, or other non-profit
3 Not swagger. Stuff We All Get. T-shirts, water bottles, giveaways, etc
4 …and your organization’s treasurer