The Basics of Building a Practical Event Budget
Creating an event budget is one of the first steps in the event planning process. It lays the foundation for the rest of your work.
Whether you’re new to event planning or you’re a veteran planner, a solid budget keeps you organized and helps you prevent overspending. It even helps you make creative decisions by narrowing your choices (it’s easy to pick chair covers, for instance, when you know which ones you can afford).Creating an event budget is one of the first steps in the event planning process. Click To Tweet
Before you start touring venues, tasting food samples, or sending invitations, create a budget document to manage your costs. If you don’t take your expenses seriously, you risk creating a poor event experience and a financial disaster.
Setting Up Your Event Budget
Your first step is to prepare a budget document to track your costs.
Managing a budget in your head isn’t feasible, so you’ll need a tool. There are plenty of event planning software tools worth exploring, or you can set up your own spreadsheet.
The biggest advantage to a custom spreadsheet is that you can tailor it to your specific preferences and needs. If you decide to create your own budget spreadsheet, you’ll need the following columns:
- Item name (e.g. “Venue rental”)
- Item description – Any pertinent details that apply to the budget
- Projected expense – How much you think it will cost (can use vendor quotes here)
- Actual cost – What the item actually costs
- Paid? (Mark whether you’ve paid for it yet or not)
Feel free to add any other columns that make sense in your circumstance. If you work with a team, keep your budget data in a central location for everyone to access.
Event Budget Expenses
Let’s go over the basic categories of expenses that apply to nearly every event. Consider these carefully as you prepare your budget. List them in the “Item name” column of your spreadsheet.
1. The Venue
The venue is usually the largest expense in any event budget. Most event planners choose their venue before they make other purchases or commit to other vendors.
Since the venue is the most impactful component of your event, its cost will likely determine what you can spend on everything else.
Additionally, your venue will also have the most impact on your budget. For instance, if the venue provides food, you can eliminate that line from your budget. But if the venue doesn’t provide wait staff, you may need to hire your own. So once you choose a venue, you’ll inevitably have to revisit your budget to make changes.
Selecting a venue is a big process, so take it seriously. Make sure you understand its real costs. Many venues have a schedule of additional fees on top of the advertised price. For instance, they might charge a cleanup fee or a security fee.
It’s also important to understand exactly what you get for your money. Many venues have a menu of additional services, like valet attendants, Wi-Fi, or specialized equipment. Don’t assume anything comes with the base price. Make sure your contract details everything.
2. Speakers or Entertainment
Depending on your needs, entertainment could be a big or small expense. If all you need is a DJ for the day, you won’t invest much. But if you need a high profile keynote speaker or popular music act, you may end up spending as much on entertainment as you spent on the venue.
Like your venue, this is a component that reaches beyond today’s event. Your attendees will talk about the entertainment. Great entertainment won’t just drive sign ups for today’s event. Word will spread and create buzz for your next event too. So don’t be afraid to spend on quality.
Your venue may include your general staffing needs, but you may need some specialized people to handle complex tasks like registration, organization, and managing speakers and/or entertainment. Expect to compensate good help for their labor, travel expenses, accommodations, and meals.
4. Signage and Branding
Creating a powerful event experience means bringing your brand to life. To do that, you’ll need to include branded elements throughout your venue.
This is one of the places of your budget where it’s easy to overspend, so it’s important to have a clear vision in mind before you start buying visual elements. You wouldn’t, for instance, want to spend a load of cash on a waterfall feature and then run out of money to label the bathrooms.
HubSpot’s INBOUND event takes branding to the next level with giant 3-D signs and high quality displays scattered throughout the entire venue. They use artwork to inform and amaze their guests.
You might not take your branding to this level, but it’s important to give your event its own personality. Create a vision of what your event should look like and how it should make guests feel, then itemize the cost of your displays, decorations, and signs.
5. Technology Expenses
Most modern events use technology in some way to enhance the experience (especially video). You may need microphones and PA systems, televisions or projectors, digital signage, or a custom event app to create a truly engaging experience for your attendees.
Start by making a list of the different types of technology you’ll need for your event. For instance, if you plan to have a single speaker at any given time, you’ll need at least one computer and screen for their display equipment.
Next, make some calls to get an idea of how much that equipment would cost for rental and setup. Depending on your needs, you may want to hire a contractor to manage the pieces.
6. Promotional Expenses
Planning the event includes marketing it. You’ll need to decide how much you’re willing to spend to attract people to register and attend your event.
How you attract attendees will depend on your event and audience. If you’re planning a company picnic, marketing might be as simple as sending a few emails to the company email list, announcing it over the PA system, or asking managers to hand out flyers to their teams. In these cases, your expenses would be pretty low.
If you’re throwing an industry conference, however, you may invest more into marketing. You might choose to use email marketing, blogging, paid ads, press releases, and affiliates to get the word out. In these cases, your promotional expenses would add up quickly.
7. Emergency Fund
No matter how carefully you budget every detail of your event, it’s critical to set aside some cash as an emergency fund. Undoubtedly, you’ll have a few last minute expenses you can’t avoid.
Here are some examples of instances where you might need an emergency fund:
- A speaker cancels, so you have to find someone at the last minute (expensive).
- After setting up, you realize you don’t have enough signage to help your guests get around.
- A vendor fails to deliver a food ingredient, so you have to order something else.
If any of those instances occurred during your event, a stash of cash would literally save your event. Set 10% to 20% of your total budget aside for emergencies.
8. Food Expenses
If the venue you choose won’t cater your event, you’ll need a separate line item for food.
Fortunately, food is a special category because you have a lot of control over what you serve. There are always ways to raise or lower the cost of this expense. If another budget item goes over, you’ll most likely be able to make adjustments to your food budget to compensate.
Most caterers will give you a price per guest to help you plan meals. Total your guests, speakers, volunteers, staff, and anyone else who’s a part of your event, then add 10% for incidentals.
It’s smart to send every attendee home with something in their hand. Some events give their guests small tokens like pens, keychains, or stickers. Other events give their attendees gift bags worth hundreds of dollars.
You may want to give different gifts to different people depending on their role. For instance, a keynote speaker would receive a nicer gift than a volunteer or someone who purchased your cheapest admission ticket.
10. Other Expenses
Every event is different, so we can’t predict exactly what your event needs. The previous categories apply to every event, but here are a few less common expenses you might incur:
- Equipment rentals (tables, chairs, bars, tents, attractions, stages, lighting, audio/visual, etc.)
- Printing (invitations, schedules, programs, badges, etc.)
- Costumes, uniforms, or specialized clothing
- On-site medical services
- Cosmetic services (hair, makeup, manicures, pedicures, etc.)
- Activities (golf, spa, demonstrations, games, etc.)
- Software and apps
- Permits and licenses
- Transportation (moving equipment or people around)
- Legal Fees
Event Budgets Are Living Documents
No matter how carefully you budget for your event, something will always come up. A cost will change, which makes that feature unaffordable. Or perhaps you’ll find a cheaper way to make something happen, freeing up some cash you can spend elsewhere.
It’s necessary to stick to your budget so you don’t overspend, but it’s also important to let your budget evolve as you move through the planning process and gain more information. Don’t be afraid to revisit your budget document and evaluate it for changes. When costs change, make sure to update your budget document promptly, otherwise you’ll risk making decisions on bad information.
Success Means Planning Carefully
The secret to a successful event is meticulous planning. The best event planners in the world know how to step back to look at the big picture and wade into the details. Cost is a critical component of good event planning, so it’s imperative that you budget carefully and spend wisely.