In our world of events, clients are continually seeking innovative solutions for their event needs. These solutions cost money! Across the event spectrum, budgets are as wide as the missions are varied. In all cases, the financial parameters of these events govern the critical decisions made throughout the development and implementation process.
Within the ‘financial parameters’ of designing and producing an event, there are critical budgeting tracks to consider. Each ‘parameter’ has its own set of guidelines within the context of the budget application. Some of these financial parameters are:
- Source and sell – Costs researched to support the initial ‘selling’ documents such as line item prices for each event element
- Cost to fulfill – Actual billed cost of each event element contracted and all costs associated to successfully ‘deliver’ that contracted service or product
- Accounting to conclusion – Costs of administering the finances assigned for the event including cash flow, deposits and distribution, as well as final payments, accountability and wrap-up
Fantastic ideas are a top differentiator when the client or event committee comes to selecting the design or service offered. However, it is the innovative and unique idea that demonstrates its deliverability within the expressed budget that will prevail. In all cases, the client has a price point they are comfortable with, and while sometimes they can be inspired to find more money for a truly wonderful idea, there is no guarantee that endless sums of extra money will magically appear. In most cases, the budget tends to be the fixed aspect of the entire event process.
In the event industry, there are no standard pricing formulas or budgeting models to follow. Where one will find solid guidelines for food and beverage budgeting, there are no ‘per-person’ recommendations in budgeting for design, entertainment and decor. A budget assigned for eight guests in a 180,000-square-foot ballroom will require an extremely different spending approach than the same dollars assigned for a group of 600 guests dining in the same ballroom space.
When we decorate a room, it is the event mission merged with the event space that will directly inform the bulk of the spending allocations – not how many eyes will see the room or ears will hear the music. Again, there are no funding formulas governing the cost per square foot for temporary event decor and room transformations.
The savvy event designer or event manager will identify and recommend the best ways to ‘spend’ the client’s expressed budget. At the beginning of vision development, it is essential to know what the financial parameters will be.
The budget is the starting point. The budget is the event’s ‘reality check’ and will aid in critical decision making throughout the entire event production process.
Often in responding to a design request, try not to let the need for a speedy response overshadow the need for a properly researched and accurate costing. When seeking quotes, help speed up the process by offering up as much information about the event as possible.
It is virtually impossible to answer an email simply asking: How much does drapery cost? No supplier can accurately respond to a vague inquiry without posing a series of valid and necessary questions such as: How tall? How wide? What colour? For when? For how long? Where is it going? Yes, suppliers need answers to all these questions to effectively quote ‘how much’ the drapery will cost!
One means to combat the challenges of creating and managing the event budget is to utilize a basic budget template. This can be an effective cost control solution for both the buyer of event services as well as, for the suppliers to the event. A template will help break down each aspect of the vision and will help in assigning each line item cost. A template will also prompt the planner or designer to include the less exciting but absolutely critical non-vision costs such as transportation, power and administration fees to name a few.
For an event supplier, an in-house budget template will include reminders for each hidden cost and will help in preparing accurate and profitable quotes for the service or product offered. For example, if you serve the wedding market, costs for invitations and mailing may be relevant. If you are a balloon supplier, the cost for weights to secure clusters, helium for inflation and, the cost of going to get the helium may be items to be included in the template.
For an event buyer, each industry discipline or event supplier will have similarities as well as differences relevant to the costs of providing their unique product or service. Learn the critical and logistical needs of each contracted discipline in order to request and secure an understandable, accurate and useful quotation.
As the event process unfolds, all members of the event team will be enabled by a well-crafted budget that informs direct spending decisions for each contracted expense allocation.