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You are here: Home / Auctioneers / Gala budgeting: Where smart Auction Chairs spend money
May 14

Gala budgeting: Where smart Auction Chairs spend money

Sherry Truhlar 2 Comments

Budgets for fundraising galas vary dramatically by organization. Whereas you might have access to a free venue and a donated meal, other groups must pay for those expenses.

Nonetheless, if we look at the budgets of gala committees across the country, we see some common expenses.

The second chart to the right shows how those expenses often rank.

The largest checks are often written to the venue and the caterer.  (In the case of a hotel venue, the venue and caterer are typically the same.)

Interestingly, I’m working with a nonprofit whereby the largest check they write will be for entertainment. The organization is paying for a well-known person to speak, with the hope his presence will drive substantial ticket sales.  I’m curious to see if this decision pans out for them.

Triangle chart showing costs of benefit auctions

Here’s the irony of our budget triangle:  The vendor typically receiving the largest check rarely has the same mission as you.

Let me explain it using vendor examples.

  • CATERING: Will a guest donate more money that night if the meal is better than expected?  Probably not.  A guest will enjoy the meal, but they won’t bid another $500 in the live auction because of it.  The caterer’s mission is to provide a delicious meal; not raise more money for your cause.

 

  • FLORIST: Will a guest donate more money because the centerpieces from the florist are exceptional?  No. The florist’s mission is to provide pretty centerpieces, not raise more money for your cause.

 

  • USPS: What about the US Postal Service? Will the mailman deliver your invitation in such a way that a new guest will decide to buy a ticket?  No.  The USPS has a mission of delivering timely mail; not raise more money for your cause.

 

  • VENUE: Does a new / compelling / interesting venue raise money? An unusual space might attract more guests, especially if it’s usually something “off-limits” to the public.  You’ll sell more tickets, but that doesn’t always translate to more money given onsite.  The venue has a mission of providing a safe facility, not raise more money for your cause.

 

  • ENTERTAINMENT:  What about a kick-ass band? If you budget more money for a band and get someone REALLY good, will you raise more money?  If the entertainer’s name is Bruce Springsteen, Billy Joel or Taylor Swift, you’ll sell more tickets and – similar to my comment about the venue — it might equate to more profit.  But if you’re spending a lot more to hire a local “better” band, save your money.  The band’s mission is to get people dancing, not raise more money for your cause.

Triangle chart showing auctioneer

Here’s the bottom line.

The ONLY vendor who shares your mission of raising money is your benefit auctioneer.

Your auctioneer is a professional sales person with the singular goal of getting guests to donate more money. To accomplish this goal, auctioneers use their personality, charisma and chant (the “fast talk”).  They facilitate the event so it has momentum. They cajole and entertain.

And if you’re using a good benefit auctioneer, you’ll usually get additional ideas prior to the event that will also help you raise more money. The best auctioneers will consult with you.

So when it comes to selecting vendors, where do you think your most important decision lies?

Your biggest decision should be who to hire as your fundraising auctioneer.  Your auctioneer is the ONLY vendor sharing your mission of raising money.

 

Copyright © 2013 Red Apple Auctions Co. All Rights Reserved

About Sherry Truhlar

Fundraising auctioneer and educator, helping schools and nonprofits plan more profitable benefit auctions. A prolific writer for her own blog and other fundraising sites, she’s been covered in The Beacon-News, Town & Country Magazine, The Washington Post Magazine, Northern Virginia Magazine, Wiley's Special Events Galore!, AUCTIONEER, and other publications.

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Comments

  1. Lisa Schaffer says

    May 14, 2013 at 10:38 PM

    Do you have any suggestions for the following situation? Our club has had Chinese New Year Dinner Dance with Silent and Live Auction for 12 years. There are several of the more senior members of the club who insist of keeping the Chinese New Year theme. On the other hand, there are many younger members of the club who would like to keep the Silent and Live Auction part of the event, however change the Chinese New Year theme and possibly get away from the “Dance” part of the event. We generally have between 200-300 people attend the event….at best we have a dozen people get up and dance for a song or two. Many of us feel that money is being wasted on a band. However the older people feel that when people are paying $85 per person they “expect” live music. Part of the reason that many of us want to change the theme is because we receive multiple complaints about how “terrible” the food is. We hold the event in a hotel which holds many conferences, weddings, etc. If we change the theme, we feel that we would have a much better menu choice. We’ve also been told by many of the non-members who attend that they attend the event because they are friends and co-workers of the co-chairs and that part of the money raised goes to the local non-profit hospital that many of us work. This past year we managed to get them to allow us to try using “PayPal” (which was successful). We also created a central email address (the one above) in hopes that all of the requests, questions, communication, etc. goes to one place and is directed to the proper person from that one central email address. Also, the older members of the club are completely against spending any kind of money…this past year the new co-chairs spent approx. $70 to purchase necklace and bracelet displays. It was such a hurdle spending the money that the person who purchased them decided it was best to donate them to the club instead of fighting with people to be reimbursed $70. Thanking you in advancing for your suggestions.
    Lisa Schaffer

    Reply
    • Sherry Truhlar says

      May 14, 2013 at 10:54 PM

      Wow! You’ve got a lot of questions tucked into this. Clearly you’ve got your hands full! The good news is that you’re not alone. This sort of resistance is pretty common.

      In fact, you might find it fun to watch this video clip (below) shot at a school, immediately following their auction. For 10 years, this event raised $17k to $19k. A new Auction Chair took the reigns, did her homework, and made three big changes. 1) They moved from a potluck to a catered meal. 2) They bought software to help with registration and check-out. 3) They hired a professional auctioneer (me).

      The committee approved the first two changes, but adamantly refused to pay my fee. So the Auction Chair stepped forward and paid for me herself.

      At the end of the night, they’d raised $68,000 … a $50,000 gain IN ONE YEAR. Everyone was stunned, thrilled, gasping, etc. This video was shot as guests checked out. You’ll hear from one of the “naysayers” who had argued against spending any money on their auction.

      Here’s the link https://www.redappleauctions.com/about-us/clients/orchard-house-school/

      (Incidentally, at their next auction, they raised $82,000.)

      Regarding the theme … I think you should change it for all the reasons you’ve identified, and others.

      And for further help, consider investing in a consulting package. At this time, rates start at $260 … and there is a LOT we can cover in 75 minutes. Learn more here: https://www.redappleauctions.com/benefit-auction-consulting-and-training/benefit-auction-consulting/

      Reply

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