Properly budgeting an event is probably the most effective tool you can have, not only for keeping tabs on when and if things starts to go awry financially but also as a checklist for all elements of your event.

The temptation to spend too much on an event because of the number of options available and the pressure to produce a perfect event is huge, but having a budget spreadsheet in place which divides all your spend into the elements you need, will ensure that your event either makes money or stays within the restraints of your budget.

Your starting point should be to consider your audience and decide how important they are to you, what impact you are hoping to make and your ultimate objective. Deciding what you want from the event will help to determine the venue, the programme and the cost. A word to the wise - organizing an event that is cheap and cheerful is often interpreted as cheap and nasty and will have a direct effect on how your audience views your company.

Once that has been established, it's critical to assess the needs of the event, such as the amount of space required, the programme and functions and what days of the week the meeting will occur. All of these elements affect the budget.

Third, you should familiarize yourself with the attendees. If they are high-level employees, costs will probably be higher. Special requirements, such as dietary needs, can influence food and beverage costs. Where the guests are travelling from can influence the location of the meeting and again, the cost.

After gathering this information, a budget spreadsheet that enables you to project expenditures and revenues should be drawn up. If your event has taken place before, you are at a distinct advantage. Looking at an event’s history is a good way to get a sense of the breakdown of costs associated with the event.

So if you are starting from scratch, what should you be including? The short answer is everything. Divide your spreadsheet into two distinct sections – income and expenditure – and take time to think through every element of revenue and cost associated with your event. The more meticulous you are at this stage, the more realistic your budget will be.

Expenditure

• Venue
• Marketing and promotion
• Food and beverage
• Speakers
• Entertainment
• Travel
• Accommodation
• Meeting facility
• Audiovisual
• Staffing
• Administration
• Shipping/Freight charges
• Postage
• Insurance
• Flowers and decorations
• Miscellaneous services.

In each category, you should include three columns: one for projected costs, one for actual costs, and one to capture the variance. Within each heading, look for every possible associated expense, including all taxes, bank fees and incidentals. It is also useful to add a cushion of about 10 per cent for unforeseen expenses.

Income

• Initial investment
• Registration income
• Sponsorship
• Secondary sponsorships
• Proceedings sales
• Ticket sales
• Bar income
• Miscellaneous income.

You will definitely have to pay a deposit for the venue at the very least if not 100 per cent up front. Set design and production would normally require around 50 per cent deposit as a minimum. Caterers normally require up to 75 per cent up front, whilst entertainers are normally happy to be paid after the event. If you use an event manager the whole event is likely to be paid up front, however you may save money by utilizing their large scale buying ability/discounts.

"You need to negotiate. Don’t accept anything at face value."

Next look at the different elements you have included as part of your event and call around to get prices – and here is the most important part. This is where you need to negotiate. Don’t accept anything at face value. You will undoubtedly have a limited budget so keeping costs under control is a skill you need to learn fast if you are putting on an event. So where are the main potential bottom line money-saving areas? 

• Consolidate your events, instead of having two or three small events, have one large one and this gets round the multiple booking of entertainments etc.
• Negotiate a discount with the venue if you pay the bill in full in advance. If the venue insists that you pay full rate, see what else you can get the hotel to throw in as part of the deal, especially if you have lots of attendees.
• Never pay a delegate rate and a room hire fee.
• Work with one AV company as a preferred supplier rather than using lots of different suppliers to take advantage of volume discounts and put all sessions that require the use of AV equipment in the same rooms so you don't have to pay for twice the amount of equipment.
• Use local speakers/trainers/suppliers to cut down on transportation costs.
• Design and layout printed material yourself i.e. agenda, delegate packs, maps, menus, signs etc.
• Think about hosting an event where you invite potential clients as well as existing ones. Hopefully the ones that have used you before will talk favourably about your service and encourage the potential clients to take the plunge and use you! 
• Look at whether sponsorship is an option. Are there businesses that would like to reach the target audience you are organizing the meeting for that would pay to put information in the delegate packs or set up a stand outside the meeting room?
• Don't use set menus, except as a guideline. Give the catering manager your budget and work with them to come up with a catering option that works for your group and the budget.

Having said all that, you need to be sure that your budget is realistic for what you want. We often have new clients, who want to put on a black tie event for huge numbers of people at an amazing venue and then give us a totally ridiculous budget with which to do it. As a rule of thumb, even for a very basic event, it is going to cost upward of £100 a head.

And finally, once you have your working budget in place you need to stay in control of it and use it as a working document and movable feast.

Tips for staying in control of your budget:

1. Get everything in writing: Verbal agreements mean nothing and putting on an event is hugely detailed. Remember that most of your suppliers will be dealing with several different events at any one time and so getting all promises in writing will save time and avoid confusion and costly mistakes later on.
   
   

2. Signatories: Make sure that the venue is aware of who can sign for expenses at the hotel and preferably limit those to three people to ensure you don’t end up with lots of unforeseen costs at the end of an event
   
   

3. Review budget daily: Check your budget on a daily basis. That makes it easier to spot errors, negotiate further or make necessary changes if costs are suddenly escalating in certain areas.
   
   

4. Accounts Filing: Make sure you keep a detailed file of all invoices and discussions under the same headings you have set for your budget in order to keep your daily budgeting reviews clear and easy.
   
   

5. Check all invoices: As soon as you receive an invoice, check it against the written quotation. Question anything that doesn't seem right. Don't sign off on any invoices until you are totally satisfied.
   
   

6. Be flexible: Remember to allow a certain amount of flexibility with your financial figures, because you will probably experience some unexpected expenses. Be sure to have a contingency of 10 per cent of your total budget for things that you just didn't think of.
   
   

7. Consolidate: One of the best gifts that you can give yourself for future events is a post-event summary. If you have recorded your results from past events, setting goals and budgets for the next event will be much easier. Take all the budgetary data, notes, and other useful information and summarize them in a computer spreadsheet.
   
   

Kevin Waters is MD of Elysium Events. A specialist in organizing live events, launches, parties, conferences and awards. For more information visit www.elysiumevents.co.uk