You envision a Gatsby-worthy celebration, a bash guests will be talking (and Instagramming) about for weeks. There will be plenty of cocktails, mocktails, sequins, and glitter. But there’s one little problem. You don’t have the money to pull off the party you picture.
It takes a leap of faith to start a party planning business, but it doesn’t have to take a ton of cash. Figure out what expenses are unavoidable up front, which ones you can save for later, and how much revenue you stand to bring in from ticket sales and more. Then, position your party planning business to entice potential partners and sponsors who can help you foot the bill.
Before you throw the first party in what will hopefully become a full-fledged business, here are the ground rules to starting a party planning business without a lot of cash.
Come to terms with unavoidable party expenses
First, the reality: at minimum good party has entertainment, food and drinks, decor. All of these things cost money. You may also need capital to secure a venue and for certain small-business expenditures like insurance and licensure.
Write down every expense you can think of and put them in order of priority. This will help you streamline and strike out any “nice to haves” you can add in later, once you start making real money.
In the initial planning stages, your party-planning budget might be half-baked, but even projections or estimations are better than nothing.
Write down realistic revenue projections
“Defining the value of your event means putting it into dollars and cents,” says Eventbrite Senior Technical Customer Success Manager Shirene Niksadat. Your revenue projections are your proofpoint that your party planning business will make money.
Will you be selling tickets? If so, how many do you think you can sell per event? Consider a pricing strategy that includes different types of tickets, such as early bird tickets, VIP tickets, and tickets to “after parties.” Using an event ticketing platform will give you easy access to your ticket revenue for each party you throw, and for your overall business.
Make sure you consider any other income streams your parties will bring in. For instance, will you be selling merchandise? Will there be a cash bar? Will you charge for food?
Make a pitch for initial funding
Once you know your numbers, you may realize you have tone down the level of Gatsby at your first party. Or — better idea — find investors to help you pay for it. These might include sponsors, partners, or your crazy rich aunt.
Regardless of who you are trying to convince, you’ll need some numbers to prove your idea — a comprehensive list of all your expenses, also known as a budget. Use facts and figures to convince investors that your first soirée has the chops to evolve into a full-fledged party planning business.
Crowdfunding might be another option for raising party funds. Crowdfunding also helps build event buzz — critical marketing in the early days of your party planning business.
Invest the revenue you have wisely
Play it right and you may only need to raise funds for your very first party. Then, reinvest the revenue you make from that event ,in growing your party planning business to stretch every dollar further.
Use your ticket revenue to:
- Pay vendor bills in a timely way: Your catering and floral art can make or break your party. Keep your relationships with vendors in good standing by paying them on time.
- Put money into your marketing: Let more people know about your parties, and you sell more tickets. Sell more tickets, and you have more money to put into your marketing. It’s a virtuous cycle.
- Lock in the next event: Competition for venues can be intense. Use your earnings to put a down payment on your dream venue for next year so you can start party planning early.
Pro tip: Customers of Eventbrite’s Professional and Premium packages can apply for Scheduled Payouts to receive funds two times a month or once a week. This is an excellent option for those who don’t want to wait until after the event wraps to begin reinvesting ticket revenue.
Unlock the true potential of your party planning business
Never let a lack of cash flow squelch your party planning dreams. Your initial financial planning will pay off as you scale up your business to celebrate with more and more guests.
Budgeting is only one element of creating a comprehensive party planning business plan, by the way. To give your party planning the highest chances of success, without a big cash infusion, download The Event Business Plan to Launch, Grow, and Propel Your Event.