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Maximizing Your ROI: How to Create a Budget for Your Next Event

StaffConnect
September 25, 2024

In American Express' 2024 Global Meetings and Events Forecast, which involved over 500 meetings and events professionals—including corporations, associations, buyers, and suppliers—67% predict an increase in overall meeting spending. Of these, 13% expect a rise of more than 10%. Like many other industries, the events sector is evidently grappling with rising costs. Hence, it has become essential to refine event budget planning to manage these increases and maximize Return on Investment (ROI).

If you are an event planner still getting acquainted with event budgeting, this blog post is for you. Today, we guide you step by step on how to craft a budget for your upcoming event to ensure its success and achieve the highest possible ROI from your efforts.

What Is an Event Budget?

An event budget is an estimate of the expected income and expenses associated with hosting or planning an event. It includes factors such as venue rental, catering, entertainment, marketing, and staff costs. The purpose of creating an event budget is to ensure that all financial aspects of the event are considered and to have a clear understanding of what you can afford. This helps to prevent unexpected expenses and optimize the overall success of the event. 

How to Create an Event Budget

In the current economy, it has become apparent that events are experiencing budget-related constraints, which has been causing stress among event professionals. Believe it or not, a report notes that 53% of event professionals identify shrinking budgets as their primary challenge. Given this inevitable nature of budgetary limitations, the most practical solution is to adopt effective budgeting strategies.

To assist you in creating an actionable budget, we've put together a detailed guide structured to walk you through the process step by step:

1. Define Your Event Goals and Objectives

Before diving into numbers, clearly define what you want to achieve with your event. This will help you make your budgeting decisions and prioritize your expenses more effectively. For instance, if your goal is to foster networking among attendees, you might want to allocate more funds to social activities and venues that encourage interaction. Conversely, if the purpose is mainly educational, investing in top-notch speakers and workshop materials might be prioritized. 

2. Estimate Your Income and Set a Budget

If your event will generate income, such as ticket sales, sponsorships, and merchandise, estimate how much you expect to make before making any budget allocation. By doing so, you can ensure that your spending aligns with your potential revenue. This approach helps in creating a balanced budget where expenses do not exceed the anticipated income. Additionally, it enables you to set realistic financial goals for your event, prioritize essential costs, and identify areas where you may need to seek additional funding or cut back on expenses. 

3. Make an Event Budget Breakdown

An event budget breakdown is a detailed outline of all the income and expenses associated with organizing an event. It is an essential tool for event planners and organizers to manage financial aspects, ensuring the event is both successful and financially viable. It helps keep track of where money is being spent and identifies opportunities for cost savings.

Making an event budget breakdown can be challenging, especially if you are doing it for the first time or if you're working with limited resources. To help you in making an event budget breakdown, here is a 4-step guide you can follow.  

1. List All Possible Expenses

Before you make a cost breakdown, it's important to make a full list of all your expenses first. This list can include the cost of renting a place for the event, food service, entertainment, sound and video equipment, advertising, and event management software, among other things. By making this list, you get a complete picture of your budget and can quickly decide which expenses are the most important for your event's success.

2. Categorize Expenses 

Categorizing expenses from your most important expenses to the least helps organize financial outlays into manageable segments, allowing you to prioritize and track spending effectively.  This practice also aids in identifying areas where costs can be reduced later on in your budget planning.

3. Research Cost

After making a list of all your possible expenses and categorizing them, the next step is to start getting price estimates for each item to understand how much they might cost. This step is vital as it helps you create a realistic plan for your spending. You may research costs in various ways, such as browsing online marketplaces and comparison websites, reaching out directly to service providers for quotes, attending trade shows or market expos, leveraging social media networks, and utilizing cost estimator tools or software.

4. Assign Price Estimates to Each Category

Assigning estimates to each category in a cost breakdown is essential for creating a realistic and detailed overview of your event's financial needs. This enables you to allocate funds appropriately, ensuring every aspect of the event is covered without overspending. It also helps you prioritize expenses, identify potential areas for cost savings, and prevent unexpected financial shortfalls, ultimately leading to a more efficiently organized event that stays within budget. 

A little side note on making a budget breakdown, you may use a spreadsheet to list and categorize all your expenses. A spreadsheet will help you organize your financial information in one place, making it easier to track your spending and budget effectively. 

4. Plan for Contingency

During your event budget planning, it's crucial to set aside 10 to 15% of your total budget as a contingency fund. This strategic allocation acts as a safety net, absorbing unexpected costs without jeopardizing your financial stability. 

For example, when organizing an event with a $10,000 budget, setting aside $1,000 to $1,500 for unforeseen expenses can safeguard against budget overruns due to unexpected needs such as venue changes or last-minute supplier fees. This strategy guarantees that the event can go forward without financial obstacles.

5. Monitor and Track Your Budget Regularly

As you make bookings or purchases, regularly review your budget and consistently update it with the actual expenses. This helps ensure your spending stays on track and allows you to make adjustments as needed.

Event Budget Template

Every organizer may use a different approach to creating a budget. If you're preparing an event budget for the first time, here's a simple template you may utilize.

Event Budget 

  • Event Name:
  • Date:
  • Location:

Revenue Sources:

  • Ticket Sales:
  • Sponsorships:  
  • Vendor Fees:       
  • Donations:      
  • Merchandise Sales: 
  • Other:              

Total Revenue: 

Allocated Event Budget: 

Expenditures: 

  • Venue:
  • Marketing & Promotion:
  • Production:
  • Operations:
  • Miscellaneous:

Total Expenditures:

Summary:

  • Total Revenue:
  • Allocated Event Budget:
  • Total Expenditures:
  • Net Balance:

Streamline Your Event Planning at a Lower Cost With StaffConnect

If you're looking to save more on your event planning, leveraging an all-in-one event management software like StaffConnect could be a strategic move.

StaffConnect is an event management power hub that eliminates the need for multiple tools and subscriptions for event management, simplifying logistics and potentially reducing costs significantly. It automates laborious tasks such as sending reminders, freeing up work hours every day, and allowing you to focus on strategic objectives rather than manual tasks. Plus, our platform offers additional practical tools designed to boost your processes with ease. These include a centralized database, custom mobile app, multi-currency payment, calendar and app integration, live chat, and a lot more. 

Ready to dive deeper into StaffConnect? Book your free demo and get started on your path to more efficient and cost-effective event planning today.