Event Management Budgets, Contracts, and Licenses PDF

Develop Budgets, Contracts, and Identify Permits and Licenses Budgets and contracts are the backbone of any event. Budgets must be aligned with the organizations or client’s financial goals for the event. The final budget is mutually agreed upon by the client and event organizer. Th...

Develop Budgets, Contracts, and Identify Permits and Licenses Budgets and contracts are the backbone of any event. Budgets must be aligned with the organizations or client’s financial goals for the event. The final budget is mutually agreed upon by the client and event organizer. The contract seals and binds both parties with this agreement. BUDGETS Represents an action plan that each successful event plan must carefully develop. Event planner should use the expression “staying within the budget” every day and for every project. Each budget represents the financial philosophy of the event, they may fall into one of three categories: 1. Profit – oriented events. Revenue exceeds expenses. 2. Break-even events. Revenue is equal to expense. 3. Loss Leaders or hosted events. Design from the very beginning to lose money. These events usually are organized for the purpose of promoting a cause or agenda. A budget is made up of three basic parts – REVENUE, EXPENSE and PROFIT.  Revenue – refers to the earnings from the event.  Expense – refers to payments made for goods and services used for the event.  Profit – represent a surplus Important Items in the Budget  VENUE – the expenses incurred at the site are covered here. These include costs for the needed structures, function room rentals, and accommodations for the VIP guests, speakers, and staff.  PROGRAM – expenses for the delivery of the program such as sounds and lights, fees for performer and speakers, design and equipment needed for staging.  MARKETING – marketing plan such as advertising, public relations, and promotional materials.  MEALS – these are expenses for the food and beverage served to the guest and organizers.  STAFF/PRODUCTION CREW- Salaries and fees of the organizing team and other contractual workers designated for the setup, registration, and ushering are all considered here.  TRANSPORTATION – expenses that provide transport services.  LICENSES and PERMITS – permits and licenses in organizing the event from government agencies.  ACCOMODATIONS – host usually provides shelter for the speakers and other related guests.  PRODUCTION and STAGING FACILITIES – lighting fixtures, sound system, LED walls, camera, and other technical requirements.  FEES – performers/talent, speakers  SECURITY – expenses in hiring police, security guards, bouncers, and marshals  CONTIGENCIES – should be prepared to protect people, property, proprietary information, financial investment, and reputation. It is normally from 10-201% of the total cost. Some Revenue Generating Activities  Registration fee  entrance fee  exhibit sales  vendor fees  sponsorships  advertising  area branding  merchandise sale  ex-deals CONTRACTS – is an arrangement between two or more competent parties which is noted by a legal witness, usually lawyer. A contract defines the rights and duties of the contracting parties and should be a clear roadmap of the expectations and responsibilities of both parties. It is a legal document binds the event management company and client if the event is being organized for another company or an association. It is also legal documents that binds the event management company with the hired contractors and suppliers that provide the necessary services or equipment to run an event. Reasons:  Protect your legal interest  To abide ethical practices  To ensure the safety and security of your event stakeholders  To protect your financial investment ADMINISTRATION OPERATIONS CONTRACT BETWEEN  Management contract  Freight forwarders THE EVENT ORGANIZER  Sponsorship contract  Security Agencies AND SUPPLIER  Exhibitor Contract  Transport  Venue provider  Insurance  Entertainers and  Accommodation  Association/Organization Performers provider Caterer and partnership  Media Partners other F&B suppliers  Speakers’ agreement  Advertising or PR  Program equipment  Registration form agencies suppliers  KEY COMPONENTS OF AN EVENT MANAGEMENT AGREEMENT OR CONTRACT A binding contract must contain the key components: PARTIES The names of the parties must be clearly identified. The agreement must be between these parties, and the names that are used in the agreement must be defined. OFFER The offer is the service or product tendered by one party to another. The event planner may offer consulting services to a client, or a vendor may offer products to an event planner. The offer should list all services that an event professional offers to provide. Any miscommunication here may lead to costly litigation in the future. CONSIDERATION Defines what one party will provide the other upon acceptance of an offer. Consideration may be either cash or in-kind product or services. ACCEPTANCE When both parties accept the offer, they execute (sign) agreement conforming that they understand and agree to comply with the terms and conditions of all agreement. TERMS Refers to the scope of work, event details, service conditions, mode of payment and delivery of the service. CANCELLATION A notice of contract termination is a formal declaration when both parties plan to cancel a contract without performing the obligations. FORCE MAJEUR Refers to any unforeseen and beyond the control. These may (ACT OF GOD) include hurricanes, earthquake, floods, volcanic eruptions, tornadoes, famines, wars, or other catastrophic disasters such as terrorism. ARBITRATION A place of a legal judgement when they fail to agree. BILLING Process of preparing a statement of expenses and sending invoice for collection of payables. TIME IS OF THE A clause instructed both parties that the agreement is valid only if ESSENCE it is signed within prescribed period of time. ASSIGNMENT An assignment of contract occurs when one party (assignor) hands off the contract’s obligations and benefits to another party (assignee). INSURANCE help protect your investment in a specific event. Event insurance may help cover your costs if you unexpectedly need to cancel your event or if you're found responsible for property damage or an injury caused during your event. HOLD HARMLESS In the event of negligence by either party, the negligent party AND agrees to hold the other party harmless and to defend it against INDEMNIFICATION harm. REPUTATION Is the opinion or belief of people about an individual, organization or association. COMPLETE Is the clause in the contract that signifies that all parties are in AGREEMENT agreement with the terms? RIDER Is an attachment to a main agreement and usually lists important ingredients that support the main contract? These may include sound equipment and labor, lightning, equipment and labor, food and beverages, transportation, housing for artist/entertainers, and other important financial considerations. ECO RIDER A type of rider that requires that specific activities take place to reduce the carbon footprint that is created by the event.  CHANGES TO THE When a change to a contract is needed, the affected party should AGREEMENT give written notification of the changes within a period of the effectivity of change. They can become appendices to the original contract TERMS AND Is the manner and flow by which the contract will be implemented. SEQUENCE OF EXECUTION TERMS Refers to the scope of work, event details, service conditions, mode of payment and delivery of the service. PERMITS Are issued by local, state, provincial or federal government agencies and allows you to conduct certain activities at your event. A permit may be issued only after you have submitted the appropriate documentation and have paid a fee. INTELLECTUAL PROPERTY The event Intellectual Property is protected under trademark law, design law, copyright law and consumer protection law. COPYRIGHT AND RELATED RIGHTS Copyright law offers several exclusive rights to creators of original works. These include the rights of reproduction, distribution, public performance, communication to the public, broadcasting on radio and television, and making the work available on the internet, among others. Rights owners alone can authorize or prevent such acts. However, while copyright confers the exclusive right of adaptation of a protected work. BRANDS AND TRADEMARKS Abusive use of a festival’s logo and the sale of fake arts and crafts are serious threats that can be tackled in large part by registering a trademark and/or certification mark. Trademark registration generally confers the exclusive right to prevent others from producing or marketing identical or similar products under the same or a confusingly similar mark. They are also better equipped to defend themselves against cybersquatting (the abusive registration of their mark as a domain name), thereby safeguarding their web presence, a powerful means of marketing the fest  References: Beech, J. G., Kaiser, S., & Kaspar, R. (2019). The business of events management. Pearson. Cruz, Z. L. (2019). Micro Perspective of Tourism and Hospitality. Rex Bookstore, Inc.. Roche, M. (2000) Mega- Events and Modernity: Olympics and Expos in the Growth of Global Culture. Abingdon: Taylor & Francis. Salama, M. (2021). Event project management principles, technology and innovation. Goodfellow Publishers Limited. Mathew James (2022) Become an Event Planner. http://becomeaneventplanner.org/meetingplanning.html Akash P (2017) https://www.slideshare.net/slideshow/mice-meeting-incentive-conference exhibition/76874001 Disclaimer This module is a compilation of different resources from multiple sources and authors. The authors are given due credit for their work and the person who compiled the resource materials. The assigned faculty is not the intellectual owner of the content.