7 Must-know Tips For Event Budgeting

7 Must-know Tips For Event Budgeting

An event budget is one of the most crucial aspects of any event planning endeavour. It plays a central role in determining the scope of your event, and ensures that you maximise your ROI while keeping within the boundaries of your allocated resources. However, rising costs, shifting consumer behaviours and increasingly stiff competition for audience attention mean that your event budgeting efforts need to be more efficient than ever.

The good news is that it pays off. In a 2023 report about the state of in-person B2B conferences, 80% of organisers say that in-person events make the most impact as a marketing channel. This means that following a carefully crafted event budget is likely to make a positive impact on your ROI.

Here are seven important steps to follow when you’re creating your next event budget:

1. Outline the financial goals of your event

The first step in planning any event budget is to set your goals. This should include predicting, as accurately as possible, whether your event will generate a financial profit, break even, or result in a loss. 

Keep in mind that you will most likely have to update your budget as your event planning gets underway, but it is still important to set your financial goals at the start of your planning process. This ensures your goals will guide your budgeting decisions, not the other way around.

2. List your fixed and variable costs

Break down your expenses into fixed and variable costs. Here’s how to differentiate between them:

Fixed costs refer to any costs that usually remain constant throughout your conference planning process.

Examples: venue rental, equipment, IT, speaker fees, marketing costs

Variable costs refer to any expenses that may increase or decrease depending on your conference turnout.

Examples: food and catering costs, staff salaries, guest favours.

3. Pinpoint your revenue sources

A crucial component of your event budgeting, identifying and locking down your sources of revenue helps to offset your expenses and potentially generates a profit for your event.

Here are some examples of revenue sources to consider:

• Sponsorship (Exhibitors, media sponsorships, promotional partnerships)
• Advertising (Selling physical and/or online event space, referral perks)
Upgrades (Tiered packages, seat upgrades)
Merchandise (Plushies, t-shirts, other event-specific or branded merchandise)

Another useful method is by taking reference from past events. Look at them, and find out if you can make use of similar sources of revenue in your event budget.

4. Prepare a proposal for your event budget

Create a document listing out all the details of your event budget. This proposal will present all the relevant financial information in a succinct format, while serving to convince stakeholders of your rationale and justifications for your financial requirements.

Here are some pointers to include in your proposal:

• Your expected revenue and expenses
• The goals and objectives of your event
• Market research, or any information on similar industry events
• Any relevant data from past events by your company
• Any potential additions required for your budget 
• Contingency plans for your budget 
• Your process for measuring ROI on your event

5. Calculate your cash flow

A simple but necessary event budgeting task, calculating your cash flow gives you an overview of how much cash you will have on hand for your event. A positive cash flow will give you breathing space for any unforeseen circumstances and expenses, while a negative cash flow will mean you may not have enough cash on hand to proceed with your event.

Here’s how to calculate your cash flow in two simple steps:

1. Combined Revenue – Accounts Receivable =
Cash on Hand (Before Expenses)

2. Cash on Hand (Before Expenses) – Accounts Payable =
Cash on Hand

6. Track your event budget

Planning your event budget is a fluid and ever-evolving process. During the planning process, some expenses can only be predicted, while some revenue sources might unexpectedly turn up. This means it is essential for you to track your event budgeting updates along the way.

Arrange regular scheduled meetings with your company accountant to provide any financial updates on your event budget. There is also a suite of event management or financial software to aid you on your event budgeting journey, if you require assistance.

7. Review your event budget's financial performance

After the actual event, it’s time to determine the accuracy and ROI of your event budget. Review your event budget and find out how close the actual cost of your event was to your initial projection. If there should happen to be a huge discrepancy, review what measures you can take to reduce the difference in future events.

Finally, to calculate your ROI, follow this simple equation:

Total Revenue – Total Event Cost = Total Profit

Maximise your event budget with an experienced agency today

Budgeting for your event can be a complex affair for a number of reasons. Unexpected costs might cause your projected budget to skyrocket, throwing your calculations off course and ultimately reducing your ROI.

Working with an experienced events agency will help to reduce that uncertainty. Unearthed Productions is an award-winning full-service agency that conceptualises meaningful experiences for a multitude of event formats. We will help to plan your event budget according to your needs, while making sure you stay on track to achieving your intended ROI.

Whether it’s an in-person or hybrid event, we’ll be there by your side to take care of your needs. Plan your next event with us today!

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