Advanced Event Techniques: Budgeting
Budgeting can be a beast in the event industry, which means we need to pay careful attention to manage it well. Do everyone a favor and prioritize budget as a functional area. Which leads me to the best news regarding budgeting: you can base it on your functional areas. Yep, those building block you decided on to create complex events? Each one of them is a top line item in your budget, which you can breakdown to sub categories, as needed.
Here's an example: Your client approaches you about organizing a street festival. Being a competent planner you go under contract and begin to parse your functional areas right away. Top of mind functional areas are:
- A/V and production
- Food and Beverage
- Marketing / Social Media amplification
- Tenting/ Equipment
- Security / Safety
Bingo! You've got the start of your budget. From there you can break each into a subcategory. For example:
- Street Permit: $
- Food Permit: $
- Alcohol Permit: $
- Noise Permit: $
Permits are the overarching budget line item but you place the monetary cost next to the subcategory. You then can use a variety of Excel functions to sum each functional area, compare estimated cost to actual cost, sum your complete budget, etc. It can be as simple or complex as you need it to be.
Some clients might want you to create a draft or estimated budget. You can easily research and add in estimated numbers. They might also have guidelines that require you to receive multiple competitive bids for certain line items. Obviously, some items just cost what they cost (permitting, being a prime example). If multiple bids are required carefully delineate what you need. For example, if you're looking for bids on tents for your festival you'd map out the number of tents required, their sizes, how they need to be secured (rain barrel vs stakes), length of time, etc. Gather this information up in a concise format (Excel is handy here) with a short, but detailed introduction explaining the event, date, time and location. Send it out to vendors then wait for their bids. Curious about how to find vendors? You can research (read reviews!), ask who the client has used before or if they have a preferred vendor to include for bids, or reach out to another local event planner (most are generous with information).
Once all the bids have been submitted, review and compare. Then make your suggestion to the client on who to contract. Your client may feel and choose differently than you suggest. This can be difficult to accept, but your job as the planner and consultant is to make your best recommendation and then let your client choose. From the decision point out, move forward with contracting and start filling in budget line items.
Depending on the length of your project, commit to reviewing your budget two or three times a week. There's not need to spend hours looking at it, you simply want to ensure you're capturing all purchases. It's easy for the smaller items to be forgotten. As you review your budget make sure all invoices are being properly processed and saved in an appropriate file. It makes annual events easier to plan for and compare if you're diligent.
Lastly, always add 10 - 15% of your total budget as contingency. This money can be used for unexpected costs or overages and can save you and your client a lot of heartache. If it's not used, great! If you need it, you'll be glad it's there.
Whitney is an event operations professional with over a decade of experience working with private companies (sports leagues, experiential marketing agencies, transportation companies, etc.), not for profits and Government entities. She's highly capable, with a thorough understanding of event strategy and forecasting. By prioritizing planning, she ensures successful outcomes for her clients. Whitney has broad experience in both domestic and international settings which has honed the unique ability to oversee multiple functional areas in high stake situations. "Let's be solutions oriented" is one of her favorite sayings.
As part of Whitney's commitment to small businesses, she and her sister have opened The Work Vertical, which currently provides digital templates for small business owners (more fun items soon!). Sold on Etsy, visual templates are easily customized to create client facing documents, allowing owners to focus on what they do best.