Making ends meet

zoom

Budget management doesn't have to mean cutting corners; with careful planning, even Dubai can be a bargain.

As well as dealing with a couple of thousand e-mails per day and holding a phone in one hand and a chequebook in the other, balancing budgets can be the toughest challenge for any event planner.

While no one disputes the importance of local, regional and international meetings, other factors like finding skilled staff and covering increasing rent costs can put a squeeze on the amount of cash available to event planners.

International polls show that the amount of cash put aside for meetings and events varies according to the nature of the function.

The American Express and Meeting Professionals International Future Watch 2008: a comparative outlook on the global business of meetings survey found that association planners predicted a 9.3% decrease in meetings budgets, while corporate planners believed that they would see a 27% increase in their meetings budget.

But whether the trend is up or down for planners in the Middle East, budgets still need to be managed.

For TraVision Inc. group president Bicky Carlra, budget management is all about making sure that the right person is doing the job: "As the spend of any corporate grows, it is critical to recruit professionals in-house to manage meetings/incentives - even if they still deploy a travel management company (TMC) or a professional meetings company to implement the same - thus using in-house expertise and a TMC's buying power," he explains.

"This will cut some of the unnecessary margins added. An experienced and trained meeting planner and a creative supplier can do wonders to a budget.

But planners should consider the profit strategy of the TMC or event organizer before they select one, he adds: "There is no motivation for an agency to reduce cost if they earn their revenues from a commission on the total budget.

"With a cost-plus structure you are aware of the real cost and management fee paid, which is based on the value addition the agency/TMC/professional congress organiser (PCO) brings to the table.

Accommodation and venue are generally the highest cost factor of any event, but a little flexibility goes a long way toward reducing the cost of a meeting, particularly in high-cost Grade A cities, Carlra argues.

"Companies may still try to focus on tier-one cities or cities that have special interest to their groups, but it's getting harder, as room rates have climbed 20-30% in the past year and there seems to be no low season anymore for cities like Dubai," he says.

"The easier solution is of course to go to second- or third-tier destinations, where rates are lower and there is availability. However we all know business-meeting attendance can drop significantly, especially with incentives, if the destination is not right, as it plays a critical role in drawing the right people."

One solution is to choose four-star accommodation for delegates and hold meetings or gala dinners in a superior venue.

"The other way is to use the twin city advantage," Carlra explains.

Print | Email | Discuss this article |

READERS' COMMENTS

View all comments (0)

Have your say

Click here to post a comment

Add your Comment All posts are sent to the administrator for review and are published only after approval. ArabianBusiness.com reserves the right to remove any comment at any time for any reason. Please keep your responses appropriate and on topic.
Name *
Remember me on this computer
Email *	(Your email address will not be published)
City
Country
Subject *
Comment *
Notify me of further comments
Security Code *
Please click post only once - your comment will not be published immediately.

MORE FROM ARABIANBUSINESS.COM