WEEK 11: EVENT FINANCE & TICKETING & Future of the Industry
Outcomes:
• Understand why finance is critical to event lifecyles.
• Explain why forecasting budgets and costs is a critical management operation.
• Explore various methods of earning revenue which contribute to event finance.
• Understand the Ticketing industry and its relationship with events.
• Identify ticketing strategies which maintain cashflow.
• Explain the ticket onsales process and how allocations work.
• Awareness of the dangers of financial risk and how to avoid them.
Event finance:
• Events cost money to stage
• Costs are dependent on the scope and scale of the event
• Free events still cost money to stage. This cost is borne by the organisers and/or sponsors
• Event costs can quickly spiral – finance overruns are a critical issue.
• Events may fail if finance not available or inability to take financial decisions.
-Planning where money comes from and how it is used is critical to financial control and success.
Cash is King
• Managing that money/ cash/ expenditure is very important
• Often we receive money up front well in advance of the event/ gig/ etc.
• Sometimes this can be a year or more before the event, and we might not pay suppliers until
after the event.
• Therefore…….. Cash is King
-Costs of staging the event must be forecast in order for fixed and variable costs to be calculated. -
Break Event Analysis identifies the point at which the costs and revenues are equal. This answers
the key question ; How much do I need to sell in order to cover my costs ?
-Critical to calculate how many attendees are required to cover costs.
-Understanding the difference between fixed and variable costs is key to calculating an events BEP.
-Fixed costs e.g. - Venue Hire , Equipment Hire
-Variable costs e.g. – Food & Beverage (dependent on visitor numbers)
-All costs need to be accurate and checked.
-Often, the BEP will be a factor in; venue choice, target demographic, theme & design,
, marketing mix and other event elements.
Budgeting:
• Forecasts and regulates the event operation over a given period of time.
• Sets targets for EM’s and organisers to achieve.
• A measurement of performance between forecasts and spending.
• A method to controlling expenses and defines clear responsibilities
• Helps ensure resources are used effectively.
• Administration is a mechanism to check what is going wrong.
E.g.. £1,000 budget on seating > £2,000 spent of seating
Sources of finance;
Ticket Sales Private investment
Sponsorships Partnerships
Raffles Auctions
Lotteries Merchandise sales
Catering Upsells
Souvenirs Program Sales
Charities Crowdfunding
Ticketing – Generates advance sales, provides access to event , easy to implement and recoup
revenue, accessible via apps
-Managed by a ticketing agent, funds can be used prior to event to cover staging costs.
-Quick and easy method of engaging customer bases and demographics.
-Industry is predicted to be worth $68bn globally by 2025.
TICKETING:
• Tickets have both a cost and a face value.
• Ticketing strategies should be planned as carefully as all other operations
• Price must consider cost of staging event and BEP
• Tickets are commonly generated electronically and sent via email (e-ticket)
• Some events produce a ‘hard’ or paper ticket. Sometimes classed as ‘souvenirs’ as they are
a memento and are collectable.
-Tickets can be sold at different stages of the event lifecycle. Common strategies ;
-‘Early Bird’ tickets often discounted. This allows access to the event for loyal fans for next years
event. Generates income at an early stage of an event life cycle.
Outcomes:
• Understand why finance is critical to event lifecyles.
• Explain why forecasting budgets and costs is a critical management operation.
• Explore various methods of earning revenue which contribute to event finance.
• Understand the Ticketing industry and its relationship with events.
• Identify ticketing strategies which maintain cashflow.
• Explain the ticket onsales process and how allocations work.
• Awareness of the dangers of financial risk and how to avoid them.
Event finance:
• Events cost money to stage
• Costs are dependent on the scope and scale of the event
• Free events still cost money to stage. This cost is borne by the organisers and/or sponsors
• Event costs can quickly spiral – finance overruns are a critical issue.
• Events may fail if finance not available or inability to take financial decisions.
-Planning where money comes from and how it is used is critical to financial control and success.
Cash is King
• Managing that money/ cash/ expenditure is very important
• Often we receive money up front well in advance of the event/ gig/ etc.
• Sometimes this can be a year or more before the event, and we might not pay suppliers until
after the event.
• Therefore…….. Cash is King
-Costs of staging the event must be forecast in order for fixed and variable costs to be calculated. -
Break Event Analysis identifies the point at which the costs and revenues are equal. This answers
the key question ; How much do I need to sell in order to cover my costs ?
-Critical to calculate how many attendees are required to cover costs.
-Understanding the difference between fixed and variable costs is key to calculating an events BEP.
-Fixed costs e.g. - Venue Hire , Equipment Hire
-Variable costs e.g. – Food & Beverage (dependent on visitor numbers)
-All costs need to be accurate and checked.
-Often, the BEP will be a factor in; venue choice, target demographic, theme & design,
, marketing mix and other event elements.
Budgeting:
• Forecasts and regulates the event operation over a given period of time.
• Sets targets for EM’s and organisers to achieve.
• A measurement of performance between forecasts and spending.
• A method to controlling expenses and defines clear responsibilities
• Helps ensure resources are used effectively.
• Administration is a mechanism to check what is going wrong.
E.g.. £1,000 budget on seating > £2,000 spent of seating
Sources of finance;
Ticket Sales Private investment
Sponsorships Partnerships
Raffles Auctions
Lotteries Merchandise sales
Catering Upsells
Souvenirs Program Sales
Charities Crowdfunding
Ticketing – Generates advance sales, provides access to event , easy to implement and recoup
revenue, accessible via apps
-Managed by a ticketing agent, funds can be used prior to event to cover staging costs.
-Quick and easy method of engaging customer bases and demographics.
-Industry is predicted to be worth $68bn globally by 2025.
TICKETING:
• Tickets have both a cost and a face value.
• Ticketing strategies should be planned as carefully as all other operations
• Price must consider cost of staging event and BEP
• Tickets are commonly generated electronically and sent via email (e-ticket)
• Some events produce a ‘hard’ or paper ticket. Sometimes classed as ‘souvenirs’ as they are
a memento and are collectable.
-Tickets can be sold at different stages of the event lifecycle. Common strategies ;
-‘Early Bird’ tickets often discounted. This allows access to the event for loyal fans for next years
event. Generates income at an early stage of an event life cycle.
