Budget Busters

Staff Writer
Columbus CEO

In the wake of the recent economic downturn, most companies have been forced to tighten (if not eliminate) their event budgets. Gone are the days when clients might walk in with unlimited resources, says Erin Peschel, director of marketing and national sales for the Conference Center at NorthPointe.

"Everyone has to account for every single dollar spent now," she says. "Clients will say, ‘We need to spend money on a meeting, but we don't want it to seem like we're being extravagant.' "

Therein lies the challenge: how to keep costs down while still attracting-and impressing-attendees.

NorthPointe tries to keep clients' costs to a minimum by offering two packages, Peschel says. Both include meeting space, basic audiovisual production, morning and afternoon breaks (with pastries, snacks and beverages) and lunch in the dining room. The complete package tacks on a hotel room, breakfast and dinner.

"The idea with the packages is that it's supposed to make it easier and cheaper, ultimately," Peschel says. "[At other venues] every time someone cracks open the seal on a bottle of water, you're being charged another $2.25. The alternative here is the package is like an all-inclusive resort."

Other venues are finding ways to shrink costs or work with vendors. "It's the new norm. The more versatile and creative we get, the more opportunity we have to do amazing events and deliver what the client wants," says Gary Bias, executive producer and CEO of EventCo Productions. "We're honest about the parts and pieces and what it takes to make an event happen."

Despite constricting budgets, many businesses and nonprofit organizations still need meetings and events to network, spread information and raise funds. Local event planners and hosts have devised some creative and effective ways to meet those budgets and still meet expectations.

Staying on Budget

Bias says today's climate is similar to the business travel slowdown that followed Sept. 11, 2001. "A lot of people were using in-house services. Receptionists became event planners. Maintenance people installed lighting. People found creative ways to exist through the economy," he says.

Meetings and events aren't going to disappear, Bias says: "They have a cause, whether it's a celebration, an awards show or for information. People use them to create motivation. They are scaling down the glamour because they don't want to look too over-the-top, but they know they need to make a statement."

Most businesspeople, unless they plan meetings on a regular basis, don't know how to look at an event budget, Bias says. "We sit down, roll up our sleeves and figure out their hot buttons-what they need to have happen."

Columbus-based EventCo produces full-service events across the country, including audiovisual, lighting, design and catering needs. The company works with each client to develop budgetary line items. As decisions are made-how many people, how much food, what kind of program-the bottom line fluctuates. "We take it step by step," Bias says.

The Hilton Columbus/Polaris reviews food and beverage minimums before signing a contract with a client, says Nancy Howard, director of sales and catering. "We ask if there's a certain budget and then we'll get our chef to create menus to customize prior to bidding on things," she says.

A client might want breakfast, lunch, a break and dinner, but only has so much to spend. "Knowing we have a lower budget, the chef will use some local vendors and growers so he doesn't have to ship from further out. Overall, we still want to give a quality product. We don't want it to look like it's cheap," Howard says.

Flexibility is Key

Events can change from year to year depending on a company's finances. "Last year, a group might have done a high-end dinner and this year they want to go down to a mid-range menu," says Dan Redman, director of catering for Catering By Design. "We just have to communicate so they know what they're getting for their dollar."

Catering By Design has a banquet facility equipped to serve 300 people, handles food service for the Aladdin Shrine Center and does off-site catering for events with several thousand guests.

"We try to work with the client's budget. That could mean changing the menu or not using the high-end tablecloths," Redman says. "I still want to impress their guests and give them an enjoyable experience."

Some clients arrive with a firm price limit in mind, while others may just have a vague notion of not overspending. "Sometimes they don't know their budget, but they only know their agenda. We, based on their agenda, can figure out what they will probably need," Peschel says. "Sometimes they come to us with a budget and say, ‘This is what I have to spend,' and we can say, ‘OK, here's what we can do.' "

For nonprofits, the budget is strictly enforced from the get-go, says Carol Aller-ding, director of events and sponsorship development for Experience Columbus. "Our goal is more for less, and budgets have been tighter in the last three years," she says.

"I have to raise every penny that I'm going to spend. We need to raise money for marketing efforts. So we have to sit down and determine the right amount to be charged and the right amount of expense so we don't have to come back and take dollars from marketing," Allerding says.

The key for both for-profits and nonprofits is to know what's necessary for an event to be successful. "We spend time to fully understand all the pieces," Peschel says. "We end up coaching and asking a lot of questions to make sure what we are quoting is inclusive. We don't want to end up on the other side, trying to stay within their budget and they need to add on things unexpectedly."

Sometimes, budgets may be so constrained that it's impossible for a particular venue to work within them, says Bob Monica, NorthPointe's general manager. "Maybe you sit down with someone and say, ‘From what we see, this is not a viable plan and this is not the place to do it.' If you're looking to do the cold spaghetti, no refreshments, the bathroom's a half a mile away meeting, then that doesn't meet our business model."

Keep Goals in Mind

An organization's budget is important, but Monica says the most critical event planning factor is to start with the end result in mind. "One of the things we try to focus our clients on, particularly in an era like right now when people are on a tight budget, is that they get so focused on the cost of the venue that they lose sight of what they're putting at risk," he says.

Organizers who plan an event too cheaply and without regard for its purpose risk wasting attendees' time and travel expenses as well as the desired outcome. "Let's say you're having a sales kick-off meeting and you want to earn $100 million for your company. That's your goal," Monica says. "Well, what if you don't plan that meeting right and it's bumpy and unsmooth? Now we're going to lose $25 million that our salespeople didn't get the job done on because we didn't get the message through."

Bias agrees: "People need to go into an event in this economy with an open mind, be aware of what the budgets will be and understand what they want to accomplish."

Even the small details are important, planners say. Take the case of ABC Company, which is holding a business meeting to present important information but chose a venue with uncomfortable chairs. "What they're doing as human beings is squirming in that chair and thinking, ‘Maybe I can get up and pretend I'm going to the bathroom.' " Monica says. "That's what they're thinking. They're not thinking about what they're listening to. ... If you bring people together for two or three days and put them in a room and you let them walk away without gaining your objective, you truly have failed."

Guest Experience

Perhaps the best way to stay on budget and on point is to understand attendees' needs and expectations. "If a guest is at a fundraiser, they're going to expect to be entertained and be educated about the cause. They'll be fine with a cash bar and chicken, but they won't have a good time if they didn't get the information they needed," Allerding says.

"If a guest is coming to an annual meeting and they need a lot of information, we will spend money on audiovisual, but not have a centerpiece or a lot of décor," she says.

"Every event is so different. I think that no matter what the event is, there are certain things I have to accomplish," Bias says. "What are the three most important things? They might really want to focus on branding and making sure guests leave with a full understanding. Food might be No. 2. The color orange might be really important. I listen to that and when we do the proposal and break it down on paper, we feed those items back to show we're paying attention to what we're supposed to deliver."

Before booking a bare-bones event whose only amenities are saltines and warm tap water, think about attendees. "You have to consider their expectations. Who are they? What are they expecting? Are they expecting to walk in and get breakfast? Are they expecting to be able to get their other business done while they're here? Are they expecting to be able to get on the Internet?" Peschel asks. "If someone is walking in expecting to get their morning cup of coffee and it's not there, you have ruined their day. I mean, they're not going to be there mentally."

Experience Columbus surveys everyone who comes to one of its events, including attendees and staff. "We ask about the messaging, the details, the seating, the visual, the food. That helps us establish what meant something to them and if we did a good job getting the message across," Allerding says.

Venues have an image to protect, too. Guests often don't know the difference between what the facility has provided and what their company contracted for. So it may be in the meeting place's best interest to avoid looking like the cheapskate-particularly if a few attendees might one day be clients. "You don't have to compromise on quality, even if you have a group that is very low-budgeted," Howard says. "We've been known to put some extra items out so that the hotel doesn't look bad. Just to make sure that the quality and the hotel looks good, because they don't realize that our hands are tied because that's all the organization paid for."

Cost Savers

Event planners have found subtle ways to cut costs and still meet goals. "We really work with our side partners to make sure we're in a good relationship with our suppliers and vendors. They get appropriate exposure to use our events to show for potential future business. They understand that we might need to cut back in lean years and work with us," Allerding says.

Take Experience Columbus's hospitality house at the Memorial Tournament. "I had a $2,000 ice bill last year. I went to our supplier and said we needed to cut back," Aller-ding says. "We sat down and talked about ways to cut that cost and make sure we were only using ice when we needed it. If it saves us $500, that's $500 I don't have to raise."

When times are tough, communication is key, Allerding says. Companies that are honest will find partners and suppliers are flexible more often than not. "They'd rather work with you than lose business or have you not be able to do the event at all," she says.

Other times, it may be better to seek out newer options. "You have to look at other creative directions and opportunities. You can't get stuck using the same vendors," Bias says. "There are lots of other catering companies, linen companies, staging and rental companies. Get out there and see who has a more effective product or who can give you a better price because you need a package."

Another tip: Ask about events scheduled before and after yours to see if anything can be reused or shared. "If I want to save money on my menu, I'll find out what they're serving in the other ballroom. If we serve the same thing, maybe they can give me a better deal because the kitchen is only producing one thing," Peschel says. "It's a concept that we use every single day."

NorthPointe serves buffet-style meals for all its events in one central dining room. "We're able to offer volume because everybody is eating the same thing," Peschel says. "You can expand that into a lot of different areas, like audiovisual. What was the setup in the ballroom the day before? If I could use that, I could save time on room rental and on setup. Maybe you could split it with the other group."

Ask if the venue has an abundance of any foods, then plan the menu around that. "You can find out if the chef over-ordered a certain item or if an organization coming in the week prior has over-ordered. Find out if there's anything the chef wants to get rid of instead of letting it go bad," Howard says.

Companies can also cut costs by adjusting the amount of food, such as serving a continental breakfast with a few hot items rather than a full buffet. "You should be upfront and honest with your planner and be open to suggestions or changing certain times," Howard says. "Maybe have an early reception without a dinner. If you have it during dinner, people are going to want to eat. Or have it after dinner and people will eat on their own and come to the reception already full."

Another way to save money is to keep the meeting as efficient as possible. Don't plan three days for an event that only needs two. "Don't lob off information. Don't screw up the meeting because you're trying to compress it," Monica says. "But if you watch meetings, there's a lot of wasted time and energy because they're not organized effectively. You have to be disciplined. When you tell your attendees they should be back in 10 minutes, they have to be back in 10 minutes."

Using insider tips to save some cash is all well and good, but don't sacrifice making your mark on the attendees, Peschel advises. "There's a time and a place for webcasts and for delivering information like that, but I think we should remember that there's also a very important time and place for the people connection and how that will advance your business.

"When you do bring them together, do it right. I'm not saying go to a resort and spend tens of thousands of dollars on every attendee and give them big lavish gifts. It doesn't have to be that. It can be very small, thoughtful and well-planned. Just remember that they're people. Remember your objective and create the experience."

Michelle Davey is an editorial assistant for Columbus C.E.O.

Reprinted from theAugust 2010 issue of Columbus C.E.O. Copyright © Columbus C.E.O.