A meeting professional veteran share tricks for managing inflation, expectations and savings
Money moves mountains. Money also is essential to getting an event off the ground and is the bones of an event planner’s budget. Smart Meetings spoke with Heather Pilcher, CEO and executive producer of Blue Spark Event Design, to get the nitty gritty on the current state of event budgets and what meeting planners should be aware of as they ramp up to their post-Covid events.
Up, Up and Away
If you’ve been in the business the last three years you may have noticed prices have substantially risen since 2021. Most importantly, the coffee and cookies you depend on for in-between session sugar rushes have also fallen victim to inflation. Coffee now sits at as much as $130 a gallon in some places.
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Pilcher pointed to staff labor and equipment as another area that has increased in price point, “There’s a lot of people that make that magic happen, and that can really affect your overall budget.”
Scarcity in the Gig Economy
The pandemic forced many individuals to change careers, and this impacted staffing availability as companies downsized to adjust. Currently, price and availability seem to be the leading factors of concern.
“I think it’s just scarcity of people who actually want to do the gig work, but they’re not willing to come out anymore for $20 an hour or $25 an hour.”
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Room Rentals and F&B
Pilcher pointed to room rentals and F&B as other sources of price increases. She noted she has gotten more pushback from hotels on the request to waive room rental fees in the last year.
“Room rentals used to be something that you would have to pay if you had a really low food and beverage minimum or if you were coming in within like 60 or 30 days at a hotel,” Pilcher reflected, “Now, you’re coming in and saying, ‘I’m bringing a thousand people to your hotel. I want these this many ballrooms and this’, and you’re still seeing the room rental.”
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The rising price of F&B may also have a significant impact on your budget.
“The prices are so high for the individual menu items that the value of what you’re getting doesn’t equate a lot of times,” Pilcher stated, “I’m getting so much less food. Even though I’m meeting the food and beverage minimum, because the prices of meals are so high, so that is really a struggle.”
Ultimately, the dynamic between hotels and event planners has shifted since the pandemic.
“Hotels have really tightened up. They used to say yes to a lot more things because the money was flowing. I hear a lot more: no or let me check on that or let me see if that’s something that we are willing to do.”
Internal Expectations
The changing negotiating landscape makes it important for meeting planners is to communicate with leadership so everyone has realistic expectations of what to expect while building a budget.
A few points to consider:
- Goals and KPIs
“You need to know the goals of your conference. We have clients who need vastly different things. And if you don’t listen to what those goals are, you’re not going to be able to make budgetary decisions correctly.”
- Start Early
“There are so many things that are going to affect your ability to create a realistic budget, depending on how early you’re able to start.”
- Start Honestly
“Do not start with the budget and say, oh, we’ll just do that internally. We’ll stuff a thousand envelopes with our two person staff the night before. It’ll be fine. I guarantee you, someone’s going to hate somebody else in the morning, even if you are able to accomplish that.”
- Historical Data
“Hopefully, you’ve done this from the year before so you can take a look.”
- Estimate and Communicate
“Don’t be the person who makes the choice to do bright purple lanyards because it’s your favorite color. If it costs more for purple instead of white, make sure someone else agrees with you and that it’s a group decision.”
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Finding Savings
Despite all of the challenges of negotiating prices in 2023, there are still creative ways to maintain value and reduce the bottom line. One example is providing festive alcoholic beverages. Consider speaking with the hotel and creating pre-made cocktails. This is less labor and less cost but still offers a fun option for attendees.
Building off existing relationships can be helpful in negotiating costs. “Relationships matter. It’s much better to be able to pick up the phone and talk to somebody,” Pilcher said.
Also, negotiate gracefully. It doesn’t hurt to ask for discounts but be respectful if the answer is no. “If they’re unable to fulfill our requests, we need to respect that. A lot of the times, they’re giving us the best prices anyway because we work with them so often.”
