A budget may be built as a fixed amount, by the variable of costs per
attendee, or as a combination of the two. As the event timeline unrolls,
it will be necessary to constantly track the costs associated with each
aspect of the event, and recalculate any variable costs to readjust
the overall budget. For example, a caterer
may insist on a minimum charge that will be same whether there are
0-25 guests, but then start charging by the head. The organizer will
hence know the minimum expense associated with catering,
but will only know the actual bill once registration is completed. If
the event budget is non-negotiable and there is no revenue stream, the
event’s coordinator will need to be very responsive to maximizing
the assigned budget while meeting the event’s goals.
If the event has been previously held, it should be possible to refer
to past spread sheets to determine if the budget allocation is reasonable.
Was the cocktail party before the awards dinner 50% over budget because
of alcohol consumption, while only half the guests showed up for the
actual dinner? Then budget accordingly this time around.
It is often worth purchasing financial software
specifically tailored to event management. It should allow you enter
data that tracks and reports on all aspects of the event, such as budgeted
amounts, negotiated amounts, and actual expenses. Customized reports
can show the percentage of costs within sub-budgets (how much of the
décor budget was spent on lighting, versus flowers, versus fabric,
versus props). This will help in current and future negotiations with
suppliers. The comprehensive financial picture provided by the right
financial management system will result in cost savings.
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Conventions.com
Event Planning 101
Chapter 9: Financial Management
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