CREATE THE BUDGET By Christine Christman
Create a budgeting system, from initial estimates to annual summaries.
© 2015 Christine Chirstman P. 2
CONTENTS 4
Introduction
5
Four Quick Estimating Methods
8
Zero Based Trade Show Budgets
12
Sample Budget Worksheet
23
Basic Budget Template
14
Research for Accuracy
16
Ten Common Budgeting Oversights
19
Annual Budget Template
Š 2015 Christine Chirstman P. 3
INTRODUCTION
B
udgeting for trade shows can be like shooting at a moving target. You can have your plan in place and consider as many details as possible, but inevitably, well, things happen.
The 10% fudge factor is important in the trade show budget. Graphics get scratched and need to be replaced, promotion items go missing, I&D takes place on a Saturday (and labor is time-anda-half or double time). Yet, it is essential to have a working budget in place. In this module you’ll see how to establish a working budget. This eBook provides a general framework for creating your budget. For more details about specific tasks, (e.g. building a custom exhibit) see that specific eBook.
10% Š 2015 Christine Chirstman P. 4
BUDGET ESTIMATES FOUR QUICK METHODS FOR ESTIMATING A BUDGET
1. Based on Space Cost 2. Based on Budget Histories Percentages 3. Based on Previous Show Budget 4. Based on Cost per Visitor Reached
© 2015 Christine Chirstman P. 5
1. BUDGET ESTIMATE BASED ON SPACE COST If you know how much you will spend on your space, you can use the industry average of 30% to calculate a ballpark estimate. In other words, knowing that space costs are approximately one-third of the total budget, multiply that cost by three to get a very rough ballpark figure. Since space reservations are typically made a year in advance of the show, that budget figure is one of the first you will know for certain, and can be useful for these early estimates. Keep in mind that when you use a portable exhibit, space costs often represent a larger percentage (from 30-50%) of the total budget.
Sometimes you are asked to provide budget information before you get a chance to
You can also create your own multiplier based on past show budgets.
create a thoughtful, researched budget. Here’s a few ideas.
SPACE COST $1500
MULTIPLY ESTIMATE BY 3
$4500 You can use industry averages to get a quick idea of how your budget will break down.
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2. BASED ON BUDGET HISTORY PERCENTAGES If you have budget histories for shows you can calculate average costs. The categories here are the most common budget entries and offer a great place to start. With good budget records you can calculate average costs and keep those averages handy when you need to get a quick estimate for a show. Exhibit construction (Costs to build a new exhibit, amortized over the number of shows at which it is expected to be used.) Booth space rental Refurbishing (Cost to refurbish the exhibit for a single show) Transportation Show services (Installation/dismantle labor, drayage, electrical, etc.) Special Personnel (Hosts, hostesses, presenters) Specialty advertising (Pre-show promotions, at-show promotions, giveaways, etc.) Miscellaneous Exhibit personnel costs (These may not be included in your show budget. You can identify whether those costs come out of your marketing budget, or sales or some combination.)
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3. BASED ON A PREVIOUS SHOW BUDGET If you have a record of past expenditures on the same show you can adjust for inflation and add new items you will be using this year to calculate a current budget estimate.
Here’s a reminder: How to Calculate Potential Audience
1. Total attendees - Press, Exhibitors, Etc
NET ATTENDEES
2. NET ATTENDEES
4. BASED ON COST PER VISITOR REACHED
X Product Interest (Avg = 16%) Potential Audience TOTAL ATTENDEES: The total number of registrants for the most recent show.
This is a bit like going in the back door, but it can be a helpful direction to take. If you have calculated your target audience at a show, and you know what you want to spend per visitor that you reach at the show you can calculate a budget estimate.
NET ATTENDEES: The total number of registrants excluding exhibitor personnel, press, spouses, students.
PRODUCT INTEREST: This figure represents the percentage of the
In our example to the right, the potential audience is 921. Say that you are willing to spend $50 for each contact made at the show. You would then multiplly 921 X $50 and your estimated budget would be $46,050.00. While this method can be good for putting boundaries on your show expense, be sure to hold that up against the reality of expenses. For example, if the estimate is roughly $46,000, then your space cost should be about 1/3 or that or $15,350.
total audience who had a high level of interest in your products. Custom research is available to determine product interest for your specific company and products. Industry averages are also available to use as a rule of thumb figure.
TARGET AUDIENCE: This is typically a percentage figure based on job function/job title, geography, or other indicative data from the attendee demographics. It is the percentage of the Net Attendees that you have identified as your target audience, using product interest averages or other factors.
Š 2015 Christine Chirstman P. 8