SETTING A BUDGET

SETTING A BUDGET

In an ideal world every project would have an unlimited budget and nothing would be impossible.
In our experience a tight budget actually improves performance because it encourages innovation.

Consider the following to help set your project budget.

1 Internal costs

How you account for your own time or those of internal resources if they are to be dedicated to the project?

2 External costs

Consultants, research, designers, print / construction costs, Advertising and Public relations

3 Opportunity costs

Consider one off costs particularly with a new brand where there is no historical finance model to follow.

4 Contingency

Always make an allowance for the unexpected. Depending on the size of the project we would advise between 10-15%

Payment terms

If you are working on a fixed fee basis you may be asked to pay the fee in stages corresponding to a schedule. For smaller projects it is common to pay 50% on commission and the remainder on completion. the project proposal should be clear about how outside costs and expenses are to be billed and if there is any mark-up for administration. (10-20% is not uncommon)

If you undertake to pay promptly you may be able to negotiate a discount.

Half the money I spend on advertising is wasted;
the trouble is I don't know which half.

John Wannamaker
US store owner