How to estimate costs

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Updated: 4/16/2007 2:29 pm
The best advice when developing a budget is to be conservative: assume that unexpected expenses will arise, and allow an extra 20% or so to cover them. If your organization already has a budget structure for events, follow it. If not, develop a detailed list by category, of every expense you can think of. For repeat events, look at past expenses as a guide; but be careful to confirm current prices. Rates can change. The event's main activity - such as the banquet, the play, or what have you - is typically the biggest single expense. Other major costs might include the site, publicity, and refreshments. You don't want to have wasted leftovers, so try to get as accurate a headcount as possible; have a cutoff date for registration, or encourage early sales by giving a discount on advance tickets. Invitations are another important expense: typically, the more elegant the event, the more the invitations will cost. You'll also have to allow for decorations, lighting, and possibly music or prizes. Leave a final category of 'miscellaneous,' but don't let it go over ten percent of the total budget. Finally, be sure to add in gratuity and taxes, as applicable. These hidden costs can easily tack on another eight to fifteen percent.
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