Often mentioned in our blog posts, it was time we dedicated an article to this key element of your event planning: the budget. It can sometimes be a hindrance or even a source of anxiety for new event organisers, but a few basic rules will help you get started in complete serenity. By reading this article carefully, you will be able to create your budget and plan your event. Over time, experience will make you an increasingly savvy manager. But for now, let’s dive into our topic!
1. List all future expenses
When preparing a budget, it is best to start by listing all possible expenses that come to mind — even those you are not sure about. The objective is to draw up a comprehensive list, even if it means removing some of the expenses later to adjust your budget. You now have a forecast budget, whose purpose is to help you prepare and anticipate rather than predict to the penny what will actually be spent.
Categories of expenses vary according to the types of events organised, but some are mandatory and should be paid special attention. We have identified five of them.
When receiving a quote for the rental of a venue, you should pay attention to the time and duration of the rental. Sometimes, rates are quoted on an hourly basis, and additional fees will apply if your event overruns into the night — or if you are still at the venue the next day to clean or tidy up.
Few events don’t have a DJ or a band. In addition to the fees charged by these service providers, don’t forget the fees to collection societies — such as PRS for Music in the UK. Forgetting them means you may receive a fine if you are audited by the relevant bodies!
If you use professional staff, you must obviously take into account salaries, and don’t forget any bonus they may be entitled to if they work night shifts or overtime. If your staff is made up of volunteers, it is generally expected that you will provide meals and accommodation for them.
Our tip: Drafting contracts is necessary when using volunteers.
Food and drinks
Food and drinks are too critical to be forgotten! However, be careful about the delivery date and quantities as these are perishable goods. Do not have them delivered too early or in too large quantities.
You can add an “unexpected” or “miscellaneous” category for expenses that you may have forgotten or that are unpredictable. The watchword for this category is: do not hesitate to plan an overestimated amount to avoid any unpleasant surprise after the event.
2. Evaluate the costs
Create a tracking document
The easiest way to establish and monitor the evolution of your budget is to create a table. As far as the right tool is concerned, you have a choice between:
- Office software (Google Sheets, Excel, Numbers…)
- A notebook or a blank sheet of paper
- A pre-printed table to be completed by hand
Time for action! Start by creating two broad categories “Expenses” and “Revenues”. Inside these, add the below columns:
- Unit price (excluding VAT and incl. VAT)
- Total (excluding VAT and incl. VAT)
In order to facilitate the readability and monitoring of your budget, it is recommended to create expense and revenue categories with subtotals. Depending on your objectives, aim for profits (expenses < revenues) or a balanced budget (expenses = revenues).
Request quotes and make estimates
In order to know your expense amount and make an estimate of your possible revenues, you have two scenarios:
- Asking for quotes from your local service providers or online will allow you to know exactly what your expenses will be. Feel free to compare several providers to study their prices and offers. This will give you negotiating power and allow you to have good deals. Be careful not to confuse the prices excluding VAT with the prices including VAT displayed on the quotes!
- Make your own estimates when you cannot request a quote. Consider overestimating costs to avoid unpleasant surprises when it comes to spending the money. In contrast, you should slightly underestimate revenues. It is even possible to consider several financial scenarios: revenues lower, equal or higher than expected.
Finally, if you have already organised similar events, you should look back at your previous quotes and invoices!
3. Do not confuse budget and cash flow
Finally, it is important to keep in mind that revenues often lag expenses. While it is sometimes possible to arrange with a service provider to pay them at the end of your event, it is often necessary to pay them a deposit before the event. It is therefore critical to have a precise knowledge of the amount that will be available in your bank account when the invoices arrive.
Before the event, you will usually need a certain amount to pay a portion of the expenses, which will have to be less than the expected revenue at the end of the event. With Weezevent, for example, you can launch your ticket sales several months/weeks before your event, and receive the revenues from tickets sold every 15 days. You will thus gain in serenity and will be able to pay part of your expenses if necessary.
To organise events with simplified accounting, discover the benefits of our solutions by clicking on the button below: