Keeping a CCI Financially Healthy
This is addressed to a CCI organising group, so “you” means that group. It is intended to be a complete guide to the small-business side of running a CCI; it mentions all the practical bits, but with a focus on money. This does not have anything to say about actual co-counselling! Actual financial decisions for any CCI event are to be taken by the organising group, this is a checklist of points to consider not a set of rules.
Negotiate early and clearly with the venue 1
Expected costs 1
Forecast number of participants 2
Budgeted base cost per person 2
Cash flow forecast, and calculating the deposit you need 2
Full payment before it starts – or cash at the door 3
Think about currency exchange 3
Discounts and sources of revenue 3
Discount process 5
Produce the advertising leaflet 6
Prioritisation and special-needs requests 6
Special-needs requests for (single) rooms 6
The Last Week: Keep something in reserve 7
Keeping track of the money 8
Other related jobs 9
Negotiate early and clearly with the venue
This is not a guide to choosing a venue, but be aware that the agreement you make with the venue has a big impact on your finances, especially the price per person and the minimum number of people (see Forecast number of participants). Negotiate! The venue may also be willing to negotiate on other matters such as the timing of deposit payments, see Cash flow forecast, and calculating the deposit you need.
Try very hard to get them to cover the key points in a written agreement, so that you don’t get surprises later. This means doing some of this work more than 18 months ahead, preferably 2 years.
Try to make sure the agreement covers everything the CCI will need from the venue – see The Last Week: Keep something in reserve. They are much more likely to promise a good choice of diets, or offer all day & late night tea + coffee, if you ask them before signing the contract, when they are still in sales-mode. After you’ve signed it, you are dependent on what they feel is reasonable.
Expected costs
The main cost at any workshop is the fee paid to the venue, but you will need to spend money on some other things as well. Here is a list of things you may wish to buy:
· Web site: This is now expected, but shouldn’t cost very much.
· Organisers’ travel: Meetings and visits beforehand. Some organisers may volunteer to pay for their own travel, but if this is expected then less well-off people are discouraged from becoming organisers.
· Welcome packs:printing the booklet is the main cost; it pays to shop around for that. You may also decide to give out other items which may add to participants’ CCI experience, for instance:
o bags (useful, and can sometimes be found very cheaply)
o notebook
o pen
o …
· Stationery:You may have a stock, but if you have to buy from scratch then this is a possible list:
o tissues
o flip chart paper, say 6 pads (many venues will provide stands)
o big paper (or thin card) for daily workshop charts
o A4 paper, say 1000 sheets (unlikely it will all be used, but cheap)
o some coloured paper, not essential but it’s good to have things available.
o validation envelopes
o paper/card for validations
o lots of different types of pens
o tape of various kinds - masking tape is good for fastening to walls
o blu-tack? But see note below on damage, under The Last Week: Keep something in reserve.
o scissors
o stuff for name tags
o stuff for name labels on room doors
o … and so on
· Cost & risk of currency exchange: best avoided, see Think about currency exchange.
· Optional extras at the event: Subsidy for transport (e.g. if a mini-bus has to be hired) or to pay for visiting specialists e.g. local musicians or dancers for a party night. Or these can be made self-supporting by asking for contributions.
· Childcare – if you want to enable people to bring children with them then you need to think about many things, in particular your country’s laws relating to childcare, which may say things about carer:child ratios, staff background checks, venue risk assessments and so on. This topic is not covered in this document, this entry is just as a reminder of one of the things you might want to spend money on.
Forecast number of participants
Some costs are per person but others (web site, organisers’ travel) are not. So for the budget you need to assume a number of participants for calculations.Be cautious.
If the venue want a minimum-number guarantee – and it is likely they will want something, if CCI is asking for exclusive use - be very cautious.
Historically, UK-Netherlands-Germany have usually had over 80 but this is not guaranteed, CCI UK 2013 had 69.Hungary-Ireland have recently been around 60, sometimes down to 50.One event a long time ago lost a lot of money, over 3000 GBP, since they promised 100 to the venue but only had 80. On the whole, numbers are declining slowly over time: 100+ was more common 20 years ago. In most people’s view 60 is still a reasonable minimum for UK-Netherlands-Germany but it would be good to have a lower commitment.
Budgeted base cost per person
Adding the extra costs (divided over the budget number of people) to the venue price per person gives a base cost per person. This is the basis for all the subsequent calculations.
Cash flow forecast, and calculating the deposit you need
You need a cash-flow forecast including deposits payable to the venue and deposits from participants. Or in other words, every time you have to pay money to the venue, you need to be able to pay it! This means you need to forecast how many participants’ deposits you expect to receive by each key date, and calculate a deposit amount which means you can cover all those payments.
Here is one example of booking dates (CCI UK 2013). Be warned that your bookings will not necessarily follow this pattern!
Date / Number of new deposits paid / Total number of deposits paid by that date / Percentage of total bookings31/7/12 / 6 / 6 / 9%
27/8/12 key date * / 10 / 16 / 23%
30/9/12 / 5 / 21 / 30%
31/10/12 / 0 / 21 / 30%
30/11/12 / 1 / 22 / 32%
31/12/12 / 0 / 22 / 32%
31/1/13 / 2 / 24 / 35%
28/2/13 / 4 / 28 / 41%
31/3/13 / 8 / 36 / 52%
30/4/13 / 10 / 46 / 67%
27/5/13 key date * / 8 / 54 / 78%
30/6/13 / 6 / 60 / 87%
28/7/13 start-CCI † / 7 / 67 / 97%
During CCI (discouraged!) / 2 / 69 / 100%
† The 7 deposit payments in the last month were all in the last week, though this does include 3 people who sent booking forms earlier but for various reasons had not paid when they sent the form.
* The “key dates” were when deposits had to be paid to the venue, so there was encouragement to book just before, see “price increases based on date” below.
If you start with a reserve of money in the bank then of course you can decide to use it to fund deposit payments to the venue if you wish. But even if you have a big reserve, it is sensible to ask for a deposit of at least 25% of “base cost per person”: you want participants to feel they have made a commitment! CCI UK 2013 asked for 36%.
Full payment before it starts – or cash at the door
It makes life much easier if everybody completes all their payments before the workshop starts – which is why you want to tell them how much they owe, see under Keeping track of the money.
But this can be difficult for travellers, who may have to pay a fee every time they transfer money; and some people are just late, or book too late. So “cash on arrival” (actual cash, or credit card to the venue) has to be another option. (Of course you can accept “cash on the second day” if you like, it makes things easier on the first night but harder during the event, the money-person has to keep on chasing people.)
Think about currency exchange
By far the simplest option is to do everything in your own currency, assuming that is the currency in which the venue’s price has been set, immediately convert any foreign-currency payments to your own currency and credit people with whatever results from this conversion. Then ask people to bring local cash when they arrive and do a final adjustment at the door.
This means that people have to pay the cost of exchange (between 2% and 8% depending on how it’s done) but if you cover this from workshop funds then it becomes another cost which has to go into the budget. If you publish a price in another currency then, apart from covering the cost of exchange, you also need to accept the risk of a big change in the exchange rate during the year after you publish the price, which could mean a significant loss (or a profit!). To have people paying “cash at the door” in your currency, but against a price fixed in another currency, is very confusing.
Discounts and sources of revenue
If your event is in a better-off country (Germany, Netherlands, USA, UK) then you will usually only get people from Hungary and Israel if you can give them a big discount (i.e. if they can pay much less than the “base cost per person”). Incomes there are much lower and most people who live there will need big discounts to be able to travel to workshops in other countries. And there are also some people in the well-off countries who don’t have much money and who will only come if they can be given a discount. Money for discounts has to come from somewhere. Here are some options:
· General uplift on the price, so the published price to participants includes a contribution to the discount fund.This is simple, and if you have a cheap venue you may not need to worry about anything more complex. But how much you can add on depends on what price you get from the venue, compared to what people will feel is affordable.This is your judgment!
· If you have a camping option then some venues charge very little for this so there is more chance that you can add an uplift onto the camping price, while still keeping the published price within reasonable bounds.
Warning: be careful if campers do not count towards the venue’s minimum-numbers guarantee. In CCI UK 2013 (which had a fairly large price difference), 17 of the 69 were campers.
· Donations:Most CCIs put an option “donate to discount fund” on the form. This usually brings in very small amounts of money (e.g. 10GBP), but you may feel it is good to have it there – and you may get one or two generous & well-off donors who can transform the finances!
· Price increases based on date. There are two main reasons for doing this: it’s a hook for advertising along the lines of “book now or pay more!”, and it encourages people to pay deposits in time for you to pay deposits to the venue, see “cash flow” above.We suggest you set your price increase dates about a week before the “key dates” when the venue wants to be paid, this allows for some people who just miss the advertised date. There is then a helpful side-effect: anyone who books after one of the price increases is contributing something to the discount fund.
Of course if you have a price increase almost a year before, to encourage bookings at the previous year’s CCI, then you can’t call it a price increase, because you don’t want to suggest that people who book during the year are paying an inflated rate, which might discourage them. Call it a “special early bird reduced price” or something like that!
It is up to you to set the amounts of the price increases, but be aware that if you set the very lowest early bird price below the “base cost per person”, then there may be a substantial number of bookings (23% in the example above) who would need subsidy from the discount fund: you probably don’t want to do this.
· Charging more for the better rooms: This all depends on what rooms the venue has to offer, but the general principle is that you can charge more for any feature you can identify:
o Single rooms: This one will certainly have many takers, there are a lot of people who will happily pay more for singles, so this is a good source of revenue.You choose the amount of the uplift; CCI UK 2013 added 7% for singles and initially had far more requests than could be satisfied.Plus 10% would probably be OK, perhaps even more. Of course if you don’t initially have any singles, but the venue is not full, then you can make some people happy and improve your finances by relabelling some twins/doubles as singles & charging more for them.
o Rooms with fewer people in them (e.g. twins rather than 3 people, or 3 rather than 6)
o Rooms with ensuite bathrooms
o Rooms which are bigger or more beautiful.If you happen to have a venue where there are big differences between the rooms, then by all means charge more for the better ones, but be prepared for the fact that most people won’t have seen the venue, won’t have seen how wonderful the rooms are, and will go for a cheaper option. So if you do this, it needs extra advertising: perhaps quite explicit, “contribute to the discount fund and get a better room”. Or just leave it to be a hidden cost of booking late, that the cheaper rooms may be full.
· Whatever you do, just remember that you will have to adminster the pricing system that you have created: so don’t make it too complicated!
· An alternative approach (never tried internationally) is a sliding scale: rather than quote a price with various extras, say “please pay between X and Y based on your income”, leaving it up to people to self-select where they would best fit. We are not aware of any occasion when this has been tried at a big CCI, so not sure what would happen. Obviously the home-country people pay less for travel so perhaps that needs to be factored in, for instance “please pay between X and Y based on your income, considering your travel costs”.