If you’re planning an event, there’s one step that is essential to making that event happen: creating the event budget. Luckily, it’s a repeated action so you can easily create a basic framework for your budget, edit it along the way, and use tools that you probably already have to make it come together. It might seem daunting and finite to create an event budget, but as long as you make one that is realistic and builds in padding in case of emergency, you’ll be all set.
Here are some basic things to think about while getting started:
- Using Excel/Google Spreadsheets
- Potentially looking into event budgeting software
- Adding line items for every single detail
- Knowing when payments are due (being late could incur an extra cost)
- Adding expected amounts and actual costs so you can see if you are over budget
What are you budgeting for?
The first step to creating your budget is to figure out every single moving part of your event that could potentially incur a cost. By keeping the smaller details that make up your event in mind, you’re able to get a more accurate budget versus one that simply includes the bigger pieces of an event like catering, venue, and AV. This is a preliminary step that you can continue to refine along the way as you speak with vendors and get a more accurate telling of your budget.
Budgeting tools don’t have to be fancy– you can start this step as quickly as opening up an empty Google Sheet and entering budget items. Start by creating a few columns:
- Item: what is the individual aspect of your event that you’re budgeting for? During this step, it’s important to be as specific as possible and to break down every single item. It’s not a good idea to lump things together. For example, grouping alcohol and food together might make intuitive sense, but putting them under the same category in your budget may cause some problems. If you need to make changes or cut out a line item, you don’t want to unintentionally alter the budget from something else in the process. Say you wanted to add an extra $100 to the food and alcohol line item. Would that money go towards extra sides or more bottles? The key is to be as detailed as possible.
- Description: add a detailed description to the item you’ll need for your event. You may ask, “Is this step really essential, or is it more of a nice-to-have?” Descriptions are absolutely necessary for your event budget! This is an important column to include in the case where your budget needs to be approved by someone in your organization who may not know what each line item is (and how essential or non-essential it is to making your event happen.)
- Amount Needed: quantities play a big role in budgeting. Increasing quantities can quickly deplete your budget. On the other hand, eliminating unnecessary quantities of something can rapidly replenish your budget. Tracking what you think you’ll need before the event as well as noting the actual quantities you used will help you mold what your future budgets look like.
- Estimated Cost: while one venue may charge a different rate than the one next door, simply knowing a ballpark figure can help you understand what kind of budget you need to ask for before an event. In the next step, we’ll tackle how to get the estimated cost as close to the actual cost to make for an accurate budget.
- Actual Cost: just like the name suggests, this column is where you’ll track the actual cost of the item. This step is crucial for future budgeting sessions to understand how costs are increasing (or decreasing) and whether or not you’ll need to think about creating a larger budget for that event for years to come.
Not sure what I’m talking about? Download Endless’ free event budget template for an example of what a comprehensive budget looks like.
How to Research Costs
Now that you have the beginnings of an event budget, you can focus on getting your estimated costs closer to your actual costs. Researching prices will help paint a picture what your actual budget will look like.
If you’ve hosted this event previously, you can look retrospectively at the amount that was spent, the line items that were utilized, and the number of guests that attended. If you expect that the event will expand in the current year, it is important to keep everything proportional using multipliers. Historical data will help put a benchmark budget in place, but you can take it one step further by getting budget details directly from the vendors’ website or by calling them. Most vendors are able to provide general figures to give you a better idea of what budget you’re looking for. For example, renting event space at a university could run more expensive when school is in session, but you could get a better rate outside of the semester. Your vendors can also give you details about the space, like free vs. paid wifi, included vs. discluded basic AV, and so on. If you find out that something like AV is included in the price of the venue, this will free up some money in your budget to potentially spend elsewhere.
Calling vendors and suppliers to get financial data isn’t always the quickest process, but it can help you understand what your budget will entail realistically. Starting a new worksheet to track potential vendors for each line item will clarify who you’ve reached out to, who’s responsive, and the costs you uncover for each vendor. Once you’ve connected with a vendor, give them as many details about your event needs and ask for the cost and what that cost includes. There might be costs you may have left out like gratuities, service fees, or tax so make sure that the vendor gives you as thorough of cost breakdown as possible. Go through each line item for each set of vendors and figure out which vendors will work best for your event. This step can be tedious so make sure you start the budgeting process well before your event happens.
Time to Get Real: Estimating The Costs
Now that you have a general idea of what you’ll be tracking when it comes to costs, it’s time to figure out the line items. Take yourself through the lifecycle of your event: what are some of the things that could cost you money along the way? Don’t stop at just the big ticket items like your venue, food and beverage, and AV (although these do make it on the list): think of smaller costs like taxes, fees, marketing, and travel. Small costs can end up devouring your budget if you don’t account for them on the front end.
Here are some things you might want to consider for budget line items:
- Costs to travel to your event: Is there a room block for your event? How much will it take to fly out your entire team? And once you get there, will it be a $100 cab ride to the venue?
- Food and beverage: Is there a minimum you’ll pay in order to hire a particular caterer for your event? What are the service fees and gratuities? Is your event better suited for a cash bar or a hosted bar with a bartender? If so, how many bars should you have? (Pro tip: use a tool like Social Tables’ Pocket Planner to use CIC-approved quantities for food and beverage.
- AV: Take a look at your AV quote: which components do you absolutely need vs. what is a nice-to-have? Are there pieces of the AV agreement that could incur an additional cost like damage fees or per diems? What should you not hack off the budget OR always plan for when it comes to AV needs? Does your in-house AV provider include fees that you should be aware of?
- Venue rentals: What venue/ space rental considerations/ hidden costs are there? Could you get charged after the fact for damage to the space?
- Could different spaces have different costs?
- Luxury hotels
- Small breakout rooms
- Meeting spaces with all inclusive packages with F&B, AV, wi-fi, and on-site support
- Marketing: What event marketing costs will there? Is there a budget set for Facebook ads, traditional marketing, giveaways, and contest prizes?
- Video production and photography: How will your videographer or photographer charge you for capturing the event? What’s included with it? Do you get access to the raw files or strictly the final product?
- The cost of internet? How much will it cost to get additional wifi coverage in your venue vs. in public spaces?
Not all of these line items will find their way into your budget but they’re worth keeping in mind if you plan a variety of events.
How much should be included in a “rainy day” fund (i.e. backup)
- Pad your budget for any unexpected costs (I usually build in 15% just in case)
- What are the biggest variable costs?
- Cancellation fees: no one likes to cancel an event but if you must, what could potentially cost you in the end?
- Worst case scenarios! Think about the absolute worst things that could happen and plan accordingly.
- Do not procrastinate creating your budget. It may seem like a daunting task, but it is a vital first step in your event planning journey. Download our free event budget template to help you get started.
- Define the focus of your event. Do you want people leaving remembering the electric ambiance, or do you want them leaving remembering the delicious food? Allocate your funds according to your priorities.
- The more details you add, the more accurate your budget will be. Ignoring one small item can be the difference between being under or over budget.
- Keep in mind that sometimes the cost of one element is dependent on the cost of another. For example, your AV costs could change depending on the venue you choose.
- Explore all you venue options. Some newer venues are transforming into one stop event shops that help eliminate the back and forth in sourcing multiple event vendors. These newer venues could potentially save you a significant amount of money in the long run!
- Don’t underprice an item to make your budget look pretty. Underpricing something may look good on paper (or screen), but it will ultimately lead to losing money when the event comes to life.
- Use your rainy day fund for emergencies only. It might be tempting to use your safety net to add some extravagance to your menu or to add some extra decor. However, dipping into your backup funds for frivolities may leave you in a scramble when a real catastrophe strikes.
- Do your research. If you put in the time when researching venues, catering companies, and AV companies, you could end up saving a lot of money. It may be tedious, but you find the best deals when you compare all your options.
- Make sure everyone is on the same page. After you create your budget, make sure you share it will everyone involved in the event. You may know how much you want to spend, but the rest of your team might have a different idea. You don’t want the person in charge of food planning for a five-course meal when you only budgeted for some light refreshments.
- Don’t be afraid to spend. You don’t always have to go with the cheapest option if you have the money for it. Yes, you may be rewarded for showing your boss a receipt that is incredibly under budget, but the quality of an item is important too! Adding a little extra money here and there can be the difference between a mediocre event and an incredible experience.
Top 10 Tips for making a budget
Spending money can be a stressful part of event planning. No one really enjoys seeing their hard-earned money flying out of the bank account! However, this stress can be alleviated with the creation of a simple budget spreadsheet. Sitting down and plugging numbers not only allows you to visually see where your money is going and coming from, but it also forces you to think about the focus of your event. Does more money need to be put towards AV? Is there enough money to cater a nice meal? The creation of a budget allows you to think about and see all of these small details. Without this critical element, you may end up being wildly unprepared for your next event. However, as long as you follow the simple steps above and keep in mind all of our little tips and tricks, you could be well on your way to creating the best (most cost-efficient) event of the year.
Without this critical element, you may end up being wildly unprepared for your next event. However, as long as you follow the simple steps above and keep in mind all of our little tips and tricks, you could be well on your way to creating the best (most cost-efficient) event of the year.