Your mission is to budget for upcoming events and don’t know where to start. Budget is more than just tracking revenue and expenses – like any business, cash flow is everything.
This step-by-step guide will be helpful.
First determine the target of the event. Your goals define the vision of the entire event, including the budget. What is your top priority? What was the scheduled attendee experience? Is this expectation a profitable event, or is it even acceptable to break down? Asking such questions will help the budget process roll.
Estimate your income from different sources of income. These may include ticket sales, sponsorship revenue and exhibitor revenue, etc. Don’t overestimate your income. Consider any variable or program that may affect income, such as unexpected bad weather.
Determine all fees. Create a list with each element of the event and related expenses, breaking it down into fixed costs (regardless of employee costs, those that do not change) and variable costs (those that vary according to the number of attendees.
Compile the master vendor list. This will make it easier to track the payment process for each vendor and manage your budget at the end of the event.
Track your fees every day. Keep track of your money from the start and update your budget in real time.
Create a contingency plan. Even with unforeseen expenses (e.g., the need to move outdoor activities inside at the last minute), you need to keep your budget. If you overspent in one area, you will need to find other areas for pruning.
Therefore, many planners create a smaller backup budget input/line item to offset these unexpected expenses. This may be the set number or percentage of the total budget of the event (usually no more than 25%) and applies only to emergencies.
Last but not least, focus on cash flow. Cash flow depends on time and terms. Schedule is when payments are attributed to the venue and your suppliers and expected revenue. The term is vendor-specific; for example, is the registered provider payable weekly or monthly.
Strategies to improve cash flow include setting a payment schedule with sponsors to get money before the event starts; passing in terms of payments briefly and extending the terms of the upcoming payments; and providing a credit check for your suppliers so that they can accept payments after the event ends.
