In this blog post I’ve concentrated on the most obvious of risks: the financial risk of running an event. I’ve listed ten practical things every event organiser can do to go about removing event risk. Every one should be considered for every event: no matter if it’s a new event or a re-run of a previously successful event.
Ten Tips on removing event risks
The venue is likely to be the single most expensive part of your event so you really have to dedicate a lot of time to the negotiation and the contract. This serious limits the risk. So in my list the first few are dedicated to the biggest expense: remember all these tips are ways to ensure you don’t spend what you don’t earn.
1. Contract to as little as you can to secure the use of the room or the venue. At the early stage of booking a venue there is no need to sign up to AV packages, menus, staging, venue graphics, etc. If you have to book then book the lowest possible package. In almost every instance you can add this to your booking if your numbers do appear.
2. Almost every venue will look for as high a minimum number for your booking as possible. You should be looking for as low a number as possible. Obviously the venue will not let you book a theatre on single figures attendees but you will be surprised how much lower they are willing to go to confirm a booking especially some months out from your event. I would say that for a room for 80 – 100 the venue is likely to take 50 – 60 as a minimum and a room for 250 the venue will take 150 – 175. So go low!
3. Ask your venue if they are willing to REDUCE the DDR rate the higher your numbers go above your minimum. This has worked for me on several occasions. For a dinner of 1200 (booked on minimums of 900) a reduction of a few pounds per person above my minimum numbers reduced the amount we spent by almost a thousand quid.
4. This is possible a bit general but I will stick by it: try to avoid fixed costs where possible. A fixed cost stays the same if you have 10 or 100 attendees so it’s best to link your expenditure to your revenue.
5. Have a budget. I know. Who doesn’t have a budget for their event? Well unfortunately I see it too often. You need a detailed budget that includes every conceivable expense as well as every likely income. My tip is to be realistic, not pessimistic and not optimistic. Most people advise you to err on the side of caution and I can’t quite agree with that. If you want your event to be a success you have to have enough risk in the budget to allow you to plan the event you want.
6. Another budget related one is to have a contingency. I normally set a 5% of expenditure in my budget for a new Gallus event and drop down to 2.5% for a rerun (unless it has changed dramatically). Using the chart above will allow you to decide on the contingency and I’ve added these in to provide some guidance.
7. This one is so obvious that it is probably why we fail to do it. Most busy venues will have an organiser moving their gear out as you move in and once you are moving out there will be someone ready to move in. So why not ask the venue for the details of the organisers who are sandwiching your event? Contact them and see if you can use the same suppliers. How simple is this?
8. Keep your cards close to your chest. When you start advertising your event it is unlikely that you will have to tell everyone about everything that is going on. So stick to the basics and start talking about the things you are doing once you can afford them.
9. Really good research avoids risk. And so does event experience. To really limit the risk of your event you should research your competition and your potential customers. Mix this with your gut feelings and your experience (or call upon it from someone like Gallus Events) to ensure that you are nicely de-risked.
10. I absolutely love this idea. It’s called Crowd Sourcing. This allows you to advertise your event before you incur ANY COSTS. Offer a great discount to those who get on board early and other incentives too. You can be really creative with these incentives! If your event proves to be popular and the initial funding covers your costs (most crowd funded / sourced events “tip” once all the costs are covered) you run your event and you remove all the financial risk.
At Gallus Events “risk” is not a four letter word. If you don’t have any risk in your event it isn’t likely to be particularly innovative; undeniably one accompanies the other. But in saying that every event should be properly de-risked no matter how innovative it is. A final and important point we organisers have to be conscious of the risk apatite of our clients. Don’t risk the relationship.