In the competitive world of business, a company's image can be just as important as the products or services it offers. That's why firms spend millions of pounds each year hosting or attending conferences, running charity events, organising product launches and throwing company parties.
To ensure the occasion runs smoothly, event management companies are often brought in to run the behind-the-scenes show. While a flair for arranging activities or parties for friends and work colleagues may indicate an interest in event management, much more is required to achieve a footing in this field.
Well-established competitors will already have a client list, tried and trusted suppliers and a portfolio of successful events to entice new business. Being able to attract customers away from the competition means being able to show you can deliver on the day and at a reasonable price - not easy without the experience to prove it.
Having said that, the variety of events required by prospective clients, whether companies or individuals, means there are a lot of niche opportunities for anyone with the imagination and enthusiasm to exploit them.
What is it?
Event management can incorporate the whole spectrum of activity organisation, from setting up conferences for blue-chip companies to organising a wedding. Basically, any occasion that needs organising can be handled by an event management company.
Sarah Withers launched her company, Aspect Event Management, in 2001. "All of the events we manage are for corporate customers, as they have more money to spend," says Withers. "We have been asked to do weddings, but they are likely to have more financial considerations. We have received most recognition for our themed parties, but we also do team-building courses, conferences, product launches and family fun days."
Her advice is to concentrate on specific areas, rather than provide the whole gamut of services, where you will hit a lot more competition. "By developing a niche you get to know the contractors - who provide the services such as catering and lighting - and will get better deals if you are using them repeatedly. You can get spread too thin otherwise."
In setting up Banbury-based Heirs & Graces in June 2001, Sam Turner also decided to target the corporate side of the business but has focused mainly on arranging conferences, as there were no conference agents in the area. "There are a lot of events companies," she warns, "which means a lot of competition."
Who is it suited to?
The barriers to entry for start-ups are very low, with little initial outlay and no professional qualifications or association memberships required to begin trading. However, creating a successful event management company requires more than the ability to organise a night out.
"I have been working in hospitality for 11 years," says Turner. "I have an HND in hotel and catering management and previously worked for an events company. The contacts developed during this time have been absolutely invaluable." The experience gained and contacts developed from working in the industry have helped in talking to potential clients and knowing how to organise an event.
But turning prospects into customers and getting them to come back requires enthusiasm, dedication and the establishment of a rapport. "The only element that one has over the competition is personality," Turner explains.
Withers also had some industry experience, having worked for a public relations firm. She decided to start her own company when her former employer relocated from Swindon. She opened a business account with Barclays on her 18th birthday, but her age has been a mixed blessing. "I have had problems with firms, especially suppliers, not taking me seriously, but it has helped with other clients because of the novelty."
Setting up was not hard, says Withers, but to keep the business going you have to be motivated and maintain a positive attitude. She started by making lists of companies in the area from local directories and from sorties around the business parks and then began cold calling to get appointments.
Most of the jobs Aspect Event Management gets now are repeat business or recommendations from clients. "Keep a sales diary and call contacts every couple of months in order to get that repeat business," Withers advises.
The business plan
Although you don't need to do a business plan unless you are borrowing money from the banks, it is a good idea. The template employed by high-street banks - which is known as MORFA (market, objectives, resources, finance and ability) - can help generate ideas on how to structure your business, says Nick Brewster, business banker with Barclays Bank in Swindon.
Identify your customers and judge whether there is sufficient demand for your business. Location is therefore very important. Swindon is on the booming M4 corridor and is home to many large, successful companies, including Motorola, Intel and Lucent Technologies.
Oxford also has a number of large firms situated locally, such as Vodafone and Alcatel. What's more, it has a fairly central location nationally and is close enough to London to service firms situated in the capital, but without having to pay London rents and thereby lose competitiveness.
You need to be clear about what you want to achieve - is the business going to be set up for enjoyment, to earn a steady income or to get rich? But keep an open mind about unforeseen opportunities.
What is available to you and what do you need to obtain? With relatively little required in the way of equipment (see below), this could come down to how much experience you have of the industry. But even the most experienced organiser needs some help sometimes, so make sure that friends and family are behind you.
Having sufficient capital of your own to invest in the business will help give it a solid foundation, as there will not be any loan repayments to worry about in the early days when revenue may be low. Alternatively, are there any grants available to help fund the initial start-up costs? If you do need to obtain a loan from a bank, can you realistically pay it back?
Having some experience of event management is inevitably going to help you understand what your customers want and how to deliver it. Confidence and enthusiasm are the most crucial commodities, reckons Brewster. "You can't go into this industry if you are unable to talk to people and get on with them," he says.
How much does it cost?
Low cost and the short lead-in time it takes to get going make starting up an event management company an attractive proposition. Essentially, you need a telephone, a car, some stationery and a PC. Most of the time will be spent on the phone, talking to prospects for new business or organising arrangements for events.
However, transport is essential for getting out to client and supplier meetings and to be at the events when required. If you don't already own one, this could be your biggest initial investment.
Letterheads, business cards and confirmation slips are necessary outlays. You should budget for about £500. You also need adequate equipment, such as a PC, printer and fax. But don't get caught in the trap of shelling out for the latest state-of-the-art equipment. "Don't waste money," warns Brewster. "Fancy equipment isn't always a necessity. A second-hand PC is just as likely to meet your needs."
One of the great advantages of starting up an event management business is that office space - the biggest expense for many firms - need not be a factor. Because the work can be done on the phone, in face-to-face meetings over lunch or at the clients' and suppliers' premises, there is no need for a prestigious, and expensive, office. Withers started out from a spare room in her parents' house. "There was no point paying out for an office I didn't need and that was crucial in allowing me to minimise overheads," she says.
Marketing is another important consideration, as event management is a service industry that depends on promotional literature - such as mailshots, brochures and web sites - to attract business, says Fred Pettit, who runs Small Firms Services Ltd, an advisory company.
As most people use the internet for research, having a web presence is increasingly important in raising your profile. It allows you to showcase the types of services available and take information requests 24 hours a day, with little maintenance. Paying a designer to set up the site can require a significant outlay, though, running to several thousand pounds.
Similarly, a brochure will be a good, if expensive, investment, although you will need to have already organised some events - and have the photos to prove it - before you can put one together. Heirs & Graces had been operating for about two months before it invested in a brochure, to the tune of £2000.
How much can I earn?
The corporate market is the main one to focus on because they have the budgets to spend, notes Pettit. A lot of revenue will be commission-based, so the more extras you can bolt on to an event, the more commissions you will earn.
"Booking the venue is our bread and butter, for which we earn a basic commission usually ranging from 8-10% plus VAT," says Turner. You can then earn extra for organising the sundries, such as lighting, catering and entertainment, though all bar takings go to the venue. When dealing with suppliers with whom Turner has a more established relationship, she may get a fee, rather than work on set commission rates.
If booking a hotel for a conference or meeting, with no entertainment involved, Aspect Event Management also earns a commission of about 8%, which requires little work. When entertainment is included the company charges a set fee. The fee depends on how many staff are required to run the event, the hours of work involved in organising it and how difficult it is to do.
"We charge a flat fee for most add-ons, such as catering, rather than put a mark-up on the suppliers' charges, as it can significantly increase the per head cost to the customer and we need to make sure we are giving value for money," says Withers.
Event management is a seasonal business, so income will run in peaks and troughs through the year. As Brewster warns, cash flow can be one of the biggest pitfalls. September through to January is the busiest, when companies are organising conferences and Christmas parties.
Heirs & Graces takes on part-time staff when it gets busy, especially at Christmas, so that it can handle more events while demand is high. February and March are often quiet, as are July and August when many employees are on holiday, although corporate fun days can offset the dearth of conferences organised in the summer.
"At the moment I'm probably earning less than I ever have done before," says Turner, "but I wanted to do something for myself and with this business I've been able to take the risk without committing a lot of money to it." So if you are keen for a new challenge, perhaps this could be just the turn of events you've been looking for.