Buffer Your Event Budget for these Surprise Expenses

Are you trying to plan for your event budget and not quite sure where to start?

As we have come to experience, especially after the last few years, there are so many new – and oftentimes surprising – event budget items to consider. In this blog, we walk you through a few of the surprise expenses our team has been encountering as we plan and lead incentive trips and meetings around the world.

As you start crunching numbers, it is important to buffer your budget in anticipation of these items:

Tourism Taxes

It is no secret that many – if not most – popular tourist destinations experienced significant economic losses during the pandemic. At the same time that they were suffering, they were also investing millions into their safety systems and infrastructure.

Meanwhile, despite the economic suffering, these tourist destinations also witnessed a rebound of their environment through a lessening of pollution when tourism paused – as well as a significant lessening of overcrowding in the destination.

Now that tourism and events are rebounding, destinations are working to secure revenue to build back their economies while protecting their destinations from overtourism. In order to do that, they are starting to impose brand new destination and hotel taxes – often with very little notice.

Because of this, it is essential that you build a buffer into your event budget as new taxes could be implemented after you have selected and contracted your event destination.

For example, a new law in Hawaii requires that 3% additional tax be collected on all hotel and short-term rental stays. This could dramatically affect your room rate budget.

Another instance is that Quintana Roo in Mexico implemented a new visitor tax as of April 1, 2021. Formally, it is officially called “Visitax” and it applies to tourists who are visiting the whole state of Quintana Roo, which includes the popular cities of Cancun, Tulum, Playa del Carmen, Bacalar, Isla Mujeres, and Riviera Maya. The cost is about $10.00 per visitor (depending on the daily exchange rate) and can be paid through the Visitax website prior to arrival. For groups, it is possible to process and pay for up to 10 people at a time.

Meeting Space Fees

Contracting hotels pre-pandemic typically meant that on-site meeting space was complimentary. However, we are starting to see meeting space come at a cost. Many hotels are adding meeting room rentals to their list of fees. This is because hotels are trying to recoup revenue, but also because meeting venues are at a premium since groups are requiring additional space for social distancing. On top of that, be on the lookout for higher food and beverage minimums – yet another way hotels are trying to make up for lost profits.

Gas Price Increases

As global gas prices soar, everything related to transportation will follow suit.

This includes the obvious event budget expenses such as airport and excursion transportation, airfares, and rental cars. But it also includes all goods that are transported. Just about everything you touch and taste as you travel is being affected. Food, hotel amenities like soap and shampoo, cleaning supplies, and promotional gifts are all coming at an additional cost because of the impact of increased gas prices.

Hotel Room Compression

With an increased demand for travel, hotel room rates are skyrocketing, due to many events postponing their 2020 and 2021 programs to 2022 and beyond. This compression means that not only are budgets soaring, but it is also becoming challenging to accommodate groups as there is so little space available.

Impact of Safety Protocols

The most important thing to remember is that we are still planning during a pandemic. Providing attendees with safety protocols and equipment such as branded face masks and hand sanitizer is no longer a nice to have, it’s expected.

On top of “safety swag,” keep in mind that many destinations still have restrictions for events. If there are capacity limitations on motorcoaches, this means you will need to book additional transportation, which could include more vehicles, labor, gasoline, and even signage. Capacity limitations in event venues may require you to source additional spaces to accommodate your group.

Testing is another investment. We recently hosted an incentive program in California and many international guests attended. To organize their required PCR COVID tests to return home, we worked with a testing company to come on-site. It cost $450.00 for the technician’s time, and the PCR tests were $150.00 per person.

Event Attendees Higher Expectations

BONUS: This isn’t quite a surprise expense, but it is important to recognize that attendee expectations have changed. Now more than ever, event leaders need to think creatively to exceed those expectations.

Many travel incentive programs transitioned to virtual experiences, gifting, or cash prizes when the pandemic hit. This means that many award winners have not gotten to experience the sought-after trip they worked so hard to earn. Because of that, incentive winners and event attendees are looking for something new.

To ensure that we are delivering a worthwhile experience, we need to add more “wow” to the event. Sometimes that can be with personalized gifts, out-of-this-world entertainment, or new inclusions for adventure and excursions. In other cases, attendees prefer transformational experiences where they can connect with the local community or volunteer with a social impact project.

Whether big or small, adding that “wow factor” also adds to your budget.

This all may feel overwhelming to take in, but it’s important to know how to plan for your event budgets for the new year. We don’t want you to be caught off guard or stuck in a sticky situation, so we’ve got you covered with a team of experts ready to support you any way you need.

If you’re looking for a sounding board to help you draft your event budget, third-party planning firms like Achieve Incentives work day-in and day-out to advise clients on how to cut costs without cutting corners. Would you like to learn more about how we can help? Schedule a call with us today.

If you want to learn more about how third-party planning firms can save you money, read more in our Safe Travels Blog, 5 Ways Event Planning Firms Can Save You Money.

Reach out to Team Achieve to move forward with planning an incentive event without worrying about the details and knowing thorough research is being done on every front.