Whether you’re putting on races through a for-profit or a nonprofit organization, having a good grasp of your race budget can often make the difference between a profitable bottom line and days of post-race head-scratching about what went wrong to land you in the red.
Admittedly, building and maintaining a race budget is not a lot of fun - not to most people, anyway - but it is something that has to be done, and has to be done right.
So to help us understand what “right” looks like for a race budget, I’ve got the pleasure of being joined in the podcast today by SRSE Sports’ Sean Ryan.
Sean has been a veteran of the industry with almost 20 years of experience in race directing, marketing, operations and financial planning, and was once hailed as “the most overeducated race director” in the industry, holding an MBA from the Kellogg School of Management. And today he’ll be helping us understand the value of good budgeting practices, how to put together a transparent and practically useful race budget, as well as sharing his thoughts on managing budget shortfalls and juggling the complexities of cost cutting while trying to maintain a quality race experience.
In this episode:
- Why putting on races is a capital intensive exercise that requires sound budgeting
- Where most race budgets fail: over-exuberance and erroneous assumptions
- The importance of keeping an updated working copy of your budget at all times
- Top line revenue vs bottom line revenue vs gross profit vs operating profit vs net profit
- Organizing expenses by category: administrative, operating, marketing
- Fixed vs variable expenses, and why fixed expenses can break your budget
- What you should aim for for a healthy bottom-line profit
- The perils of underspending on marketing
- How to build a budget from the ground up
- Calculating your budget breakeven point
- Managing budget shortfalls
- Transparent vs non-transparent cost cuts, and why, if you have to cut costs, you need to start with the latter
- You can raise prices or reduce quality, but you should not try to do both
- How to treat donations and in-kind sponsorship on your budget
- The true cost of race volunteers
Thanks to RunSignup for supporting quality content for race directors by sponsoring this episode. More than 26,000 in-person, virtual, and hybrid events use RunSignup's free and integrated solution to save time, grow their events, and raise more. If you'd like to learn more about RunSignup's all-in-one technology solution for endurance and fundraising events visit runsignup.com.
You can find more resources on anything and everything related to race directing on our website RaceDirectorsHQ.com.
You can also share your questions about race budgeting or anything else in our Facebook group, Race Directors Hub.