Do You Know How to Handle These 7 Event Budget Busters?
One of the most difficult things to do in event planning is to build a realistic budget and then stick to it. Even the most seasoned event planners can’t avoid the surprise of unexpected costs. How can you make sure your client’s budget stays afloat? By making sure you have a good financial buffer in place! Depending on the event, you should allocate 5-15% of the budget to unexpected costs. That way, when your vendor says you owe them $200 to feed their catering staff the day of, you won’t have to drop the DJ to afford it.
This is not an exhaustive list by any means. You’ll encounter many situations like these throughout your event planning career. It will make it easier to problem solve if you can predict potential road bumps. Can you handle these 7 event budget busters?
When you’re inquiring about rates for venues and vendors, you’ll likely receive an estimation of costs. As with most estimations, the total does not include tax. Tax rates differ between regions and states, so it’s difficult to give a true estimate of how much you can expect to pay. However, you know vendor products aren’t cheap. Why would a client hire you to plan an event if the budget is under $100? If the venue your clients decide on costs $3000 for 4 hours and tax is 7%… you do the math. Tax charges can become quite high! Don’t be caught in the dark, and make sure you factor tax into the budget.
Remember, your clients pay staff to come in before the event and set up. These same people must also take everything down and restore the venue back to its original state. If the event runs late, expect high overtime fees. Some venues will charge by the hour for additional time spent after closing time. If the event runs late, the vendors have to stay, too! This means that staff will collect overtime to dispose of the waste, clean, and pack up. Your clients may have a hard time stomaching such high costs, so make sure to wrap things up on time!
3. Timing of the Event
Wedding season is during the summer and early autumn months. Even if you’re not necessarily planning a wedding or reception, venue prices will skyrocket. Demand is high for venues of all sorts, so conference halls, hotels, and outdoor spaces may be booked back to back. If your clients are flexible about event times, you can help find them the best deal possible. On top of soaring prices for summer climates, you can expect a steeper price for vendors during weekends. Opt for weekday events. Catering and other vendors may also have cheaper rates during these times as well.
Similar to taxes, gratuities can sneak up on you! Some businesses build gratuities right into their contracts but don’t count on it. If you’re planning a wedding for a bride and groom, hair and makeup artists expect a tip. This shouldn’t come as too much of a surprise as they are more or less expected to tip for these services at a salon. Other services that require tips are transportation, set up, catering and bartending. We did the legwork for you and compiled a more complete list of where you should tip. Check it out here.
Venue selection is one of the first decisions your clients will make. But the price listed on their website doesn’t include all the other expenses you need to pay. Some venues make you pay for insurance in their contract. Don’t even get us started on the halls that charge you for electricity! Venues are all priced differently. If the venue price varies per head, make sure you don’t pay for extra space you don’t need. Venues may be able to throw in free parking if you’re an expert negotiator, but other fees usually aren’t avoidable. Some spaces require you to purchase in-house vending options. This would restrict your options. You would have no choice but to use their services even if they’re more than you budgeted for. Talk about ballooning expenses!
6. Sound restrictions
Is your venue outside? Maybe it’s in a quiet neighborhood? If you’re throwing a party with alcohol, things can quickly turn rowdy. Ensure you look into the appropriate sound permits. If by law you’re supposed to shut down everything by 11pm, don’t push your luck. 15 minutes of fun may not justify a hefty $1000 fine from a noise complaint. Speaking of sound permits, is your hired entertainment playing today’s greatest hits? Events can be subjected to copyright laws. Check with your venue manager for more information, or research local regulations!
This category applies to multiple components of your event. Say you are planning a corporate conference. If your clients are hosting delegates from around the country, you’ll need to book accommodations for them. On top of that, you’ll need to factor in transportation costs from the airport to the hotel and then from the hotel to the conference venue. The same applies to entertainment hires and guest speakers. Imagine also that your clients hired external caterers instead of using the in-house options. You then have to pay for those transportation costs. This includes the transportation of equipment, labor, and the actual products. Transportation of materials and people can easily eat away at your budget!
Have you encountered any of these budget busters?