Page 132 - DMGT304_EVENT_MANAGEMENT

Unit 5: Financial Management

ahead for secondary reasons (in this case social reasons), this could still be done, even Notes
though very little profit could be made.

Second, further money could be raised during the event itself, separate from ticket revenue.
Venue: the Garden Suite, Midland Hotel, Derby, England. Event date Friday 24 September
2004. Maximum capacity of the value 150 diners Ticket Price 45.

Fixed Costs For 150 people For 38 people

Venue hire 300.00 300.00
Guest speaker’s expenses 150.00 0.00
Menus and place cards 75.00 2.25
Mail-out to shareholders promoting the event 285.00 285.00
Photocopying of booking form for mail-out 60.00 60.00
Photocopying and mail-out of booked tickets 51.75 30.00

921.75 622.25
Variable Costs
Costs of dinner per head 26.40 3,960.00 1,029.60
Total Costs 4,881.75 1,706.85
Revenue of ticket price 45 6,750.00 1,710.00
Profit on event 1,868.00 3.15

This is very common at charitable dinners and is done by holding raffles, playing bingo,
having a range of money-raising games (e.g. tops and tails, etc) or holding auctions of
donated gifts or pledges. Third, the very act of holding the event might bring in new
sponsors, advertisers or useful contacts. In consequence, if organizers at any fund-raising
dinner had to make a decision about whether to run their dinner in the case of only break-
even on ticket sales, they might still wish to carry on because of the secondary benefits.
Based on this case:

1. Suppose the above event had three additional revenue-earning games, a raffle, a
bingo game and an auction of a prize, which respectively brought in E350 per
activity, what would be the total profit of the event at its maximum capacity?
2. Consider any fund-raising activity or dinner you have attended. How has the main
revenue been earned and what additional sources of revenue have the organizers
found?

3. The guest speaker's expenses in this case were very small, the speaker being a local
man with an interest in railway history. What might the costs have been for a
celebrity' or professional speaker?
4. Might these costs have wiped out the potential profit of this event? How could this
be overcome?

Source: authors, 2004

5.10 Summary

The event budget is a projection (forecast) of the income and expenditure that the event
will incur based on plans made and information gathered.

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