Budgeting. It’s the cornerstone of creating a sustainable meeting or event. It can help determine the scope of the event, return on investment (ROI) and more. Here is what I wish someone had told me about the budgeting process as an emerging meetings professional.
Why Should I Budget?
- Budgeting allows you to project costs relative to the amount of investment the organization is willing to or capable of investing in a given event
- A budget becomes the framework for an event’s goals, objectives and parameters
- It ensures your expenditures do not outweigh any revenue you may expect from event registrations
- It is a tool for decision-making (i.e. Is this the right time to host this event?)
- Lastly, it can be the ultimate determining factor of ROI
What Should I Consider When Budgeting?
- Consider common event expenses, such as guest rooms, meeting room rental, food and beverage, transportation, AV, marketing and offsite teambuilding activities
- Other expenses to consider are speaker fees, cost of printing, shipping and handling, rentals, parking, branding, gifts, technology and insurance
- Possible expenses that are less commonly considered include cost of labor, design, décor, bandwidth/internet, room drop fees, porterage, site visits, pre-planning meetings, Union impact and outside vendor fees
- Build a solid communications plan or process for providing regular updates to forecasting so adjustments can be made to the plans or the available budget dollars
- Look to include a contingency amount as a line item, preferably 10% of overall event budget
How Do I Budget?
- Here are three ways to start your budget:
- Estimate your budget based on the current market (i.e. New York City versus Richmond, Virginia, versus Laguna Niguel). This is best for events that are open to many locations and can help narrow the focus of where to host the meeting or event.
- Estimate your budget based on request for proposal (RFP) response costs. This is best for events that need to be held in a specific location, allowing you to budget using real quotes.
- Estimate your budget based on year-over-year history. This is best for recurring meetings or events.
- Choose your tool (i.e. Excel versus CVENT)
- Build out line items. I like to group similar expenses together. My process involves using Excel in the beginning and creating formulas so that dollar and quantity values update automatically when manipulated. Once my budget is approved, I load it into CVENT and track the negotiated amount and final amounts against the original budget, which helps to calculate overall program savings and cost avoidance
- Show details and avoid lump sums, when possible (i.e. 100 rooms x 3 days x $199 room rate)
- Be clear about each item. Include the item name, description, vendor name (if known), projected cost, negotiated cost, final/actual cost. Include more specific notes on an item where needed
- Provide a way to include cost avoidance items, as well as negotiated cost items to show overall impact and value of program
While these are just a few tips for budgeting, I hope that emerging meetings professionals may find this information helpful. In meetings management, with experience comes confidence, yet something new to learn is always just around the corner.
Sabrina Colquitt, CMP
Senior Meeting & Event Planner