Five Savvy Ways to Reduce Costs in Your Benefit Auction Budget

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Five Savvy Ways to Reduce Costs in Your Benefit Auction Budget

Auction Budget

Five Savvy Ways to Reduce Costs in Your Benefit Auction Budget

How many times have we heard the adage that you must spend money to make money? Auction Budget That message was repeated in a Successful Meetings.com article posted on September 21, 2009. The article is entitled, “Business Travel Study: Companies Auction Budget That Spend More, Make More.” The study was funded by the National Business Travel Association and found that for every $1 spent on business travel, over $15 could be earned.

Auction Budget

Auction Budget

The report examined ten years of data, and cautioned that under-spending on travel during a recession could cause companies to lose out on profit. ‘Find some other area with less impressive return-on-investment (ROI) to eliminate,’ the metrics seem to suggest.

Groups planning a benefit auction may wish to consider this point, and apply it to their own event. Cutting some areas of a benefit auction budget will have a more harmful effect than cutting others. Look at the ROI for each section of your budget.

In the past two years, my clients have cut expenses in these areas with no-harm-done:

    • Created their own floral arrangements versus using a florist
    • Eliminated the auction catalog. (These groups offered it online.)
    • Redesigned the auction catalog to get more for less.
    • Used a DJ instead of a band.
    • One group eliminated some emcee entirely, mentioning (after we’d worked together for a year) that the auction was enough without the added cost of entertainment.

Three other line items which can often be reduced include:

 

  • Printing: Can you use electronic Save the Date notices and response cards?
  • Postage: Using electronic notices eliminates the need for postage
  • Food: Don’t change the quality, but change the meal.

One line item you should not eliminate when you are your fiscal belt is outlaying the cost for a professional benefit auctioneer. The return-on-investment (ROI) is too great.

The ROI when using a professional auctioneer is (conservatively, by my accounts) 25% higher than what an amateur could produce. That means that for every $50,000 an amateur would sell, a professional would sell the same merchandise for $62,500. 

A well-run event by a professional auctioneer gives the impression that the organization has its act together. Guests can freely donate, knowing their money is well-spent. A poorly-run event is a sign to guests that this is an ill-managed which should not be trusted with large donations.

professional working

Usually the auctioneer is the one working at the event who has ability to encourage donations. The band never stands up to ask for donations, and I’ve yet to see a guest stand up after eating a fabulous meal to say, “This meal was so good, I’m going to donate $5,000 to your non-profit!” It just doesn’t happen.

But an can apply subtle pressure to guests to encourage them to give more than they intended. That’s the skill of the auctioneer, and that’s what you pay her or him to do. In some cases, your auctioneer might be the only person asking for money. I know that at some of my auctions, both the Executive Director and the Board President feel uncomfortable reminding attendees that they are there to spend money. By default, I become the fiscal champion. That’s not a line item you want to cut!

Be smart when looking for ways to trim the budget. Eliminate your auctioneer, and your profits will drop quicker than your expenses.

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