One of the most unpleasant surprises when organizing a party is exceeding the pre-defined spending limit. To avoid this, the team of event planners and organizers needs to have effective and controlled financial management.

Establishing this financial plan is not an easy task, because if any detail is left out, the entire organization of the party can be compromised. Therefore, organization, attention, and constant monitoring of expenses are necessary.

Another important point to highlight is that each occasion has its own peculiarities. It is necessary to analyze each event to define an effective financial management plan for that moment. For example, issues such as the number of guests, the necessary setup logistics, and items that can or cannot be left out will vary according to the party being held and are topics that greatly impact costs and need to be defined and analyzed in advance.

In short? Good financial control is essential for any type of project, from businesses to personal life and events. Now, to help you, who are organizing a gathering, to have proper financial management and avoid problems, we have produced this comprehensive guide. 

PGrab a pen and paper, and check out the tips below!

What does financial management for events involve?

First, it's necessary to understand the basic concept of financial management. This refers to the actions, processes, and practices of the company's or project's financial activities. Furthermore, it's worth mentioning that this term encompasses everything from planning to fiscal analysis and controls of monetary transactions.

So, what does financial management encompass when we talk about events? There are numerous points that need to be analyzed, and Those in charge need to keep these issues very clearly in mind: 

• The purpose of the event;
• What are some possible unforeseen events that could occur?;
• The format, date, and location of the party;
• What is budget of the event, in other words, what is the maximum budget for the occasion.

Good financial management needs to encompass the points mentioned above, because this allows you to determine the amount that can be spent on venue rental, catering, musical entertainment, decoration, and more. 

Why should I worry about the financial management of events?

We know that poor financial management is detrimental to any company. And this is no different in the events industry. 

With good control, monitoring available resources and expenses, creating different budgets, and negotiating prices, you can reduce event costs and ensure the event is a success, without financial worries. 

Furthermore, it's worth mentioning that if you're organizing an event open to the public, with ticket sales, for example, this financial management is even more important. This is because you need to be very careful not to go into the red.

And, in addition to balancing the books, with good financial organization in events open to the public, organizers can analyze whether a future edition of the event is feasible, and whether larger investments are viable. Similarly, new sponsors may be interested in financing the event.

How to implement good financial management in your event.

Aware of what financial management entails, and the importance of having good practices, now is the time for the practical part: how to implement it? 

Before we present you with 4 more general tips, it's important to mention that there are specific precautions to take for private or public parties. 

For example, if you are organizing a private event, such as a wedding or a 15th birthday party, certain items need to be included in the financial planning. These include specific outfits, dresses and suits, and personal expenses such as makeup, hair styling, and accessories. 

However, if your event is open to the public, such as concerts, workshops, and festivals, other issues need to be considered. Some examples include: setting ticket prices and sales platforms, sponsorship budget, and pre-event investments in marketing and advertising. 

Now, let's look at some general tips that will ensure effective financial management for your event.

Establish fixed and variable costs. 

The first tip is: clearly define the costs of the event. That is, which products or services will be contracted. It is essential to have this definition in a macro way, covering all "areas" of your party, because this way you can have an idea of what will require financial investments.

Furthermore, it's important to know that there are fixed and variable costs, and what the differences are between them. For example, consider the following:

• Fixed expenses: those that are indispensable regardless of the size and type of event. The venue, sound system, furniture, silverware, and speakers, if applicable, are considered fixed costs. 
• Variable expenses: these are expenses that vary according to the number of people and the format of the event. Some examples include the type of menu chosen, any necessary support materials, kits and gifts for guests, among others.

Contact suppliers in advance.

Good financial management requires that everything be done in advance to be able to research the best prices and options on the market. Therefore, it is essential that you contact your suppliers with adequate notice to request quotes and negotiate prices.

However, it's important to emphasize that prior decisions must be made before this contact can be made. The budget, the services to be contracted, and the products that will be available at the event need to be established. 

With these items determined, simply monitor the resulting values against the spending limit. And, if necessary, make adjustments to the initial plan to stay within the pre-established budget.

Pay close attention to cash flow.

Cash flow refers to the money that enters and leaves a company, and this also applies to events. Therefore, it's important to keep it updated daily and conduct periodic monitoring to understand how much was spent on each item or contract for the event, and how much money came in.

This helps you avoid getting lost amidst so many demands and numbers. Now, an extra tip: separate your cash flow by category. This way, you can more clearly see where the biggest expenses are., It understands the costs of running the event, identifies losses, and also where it is possible to make greater investments.

Use a control spreadsheet. 

This might sound like a cliché, but it makes all the difference. Having a detailed and up-to-date expense spreadsheet ensures that the financial management team has a more 'visual' understanding of the event's expenses and profits.

With it, you can organize the Total budget, fixed and variable costs, the value of each service or product contract, what was sponsored (if applicable), what still needs to be purchased and contracted, and their respective budgets. 

Finally, if you are organizing a party open to the public, with a spreadsheet focused on financial management, you can also understand after the event what your Return on Investment (ROI), or profit, was. 

Host your event with us.

Interested in holding your event at the Center Convention? You can check out all the infrastructure available at the Convention Center and throughout the Center Shopping Complex by speaking with our team. Call us at (34) 3239-8300 or email comercial@centerconvention.com.br. You can also reserve a date by clicking [here]. HERE.