Event Management: Financial Analysis and Strategic Pricing Report

This report provides a comprehensive analysis of event management, focusing on the financial aspects of organizing a business conference. It begins with an introduction to Julia Charles Event Management, detailing its services and market position. The report then delves into market research, exploring the commercial viability of event management in the UK, the industry's growth, and the competitive landscape. The core of the report examines the financial aspects of event management, including sources of finance (internal and external), the purposes of financial management within the event industry, and a critical analysis of pricing strategies (penetration, high pricing, and strategic pricing). The report applies these concepts to a specific event: a business conference planned for the O2 arena, including an analysis of CPV and break-even points. The report concludes with recommendations and a summary of the findings.

Running head: EVENT MANAGEMENT
Event Management
Name of the student:
Name of the University:
Authors Note:

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Table of Contents
Introduction:....................................................................................................................................2
Market research:..............................................................................................................................3
Commercial viability of event management products:................................................................3
The following organizations are the main competitors in the event management industry in the
country to Julia Charles:..............................................................................................................5
Sources of finance:..........................................................................................................................6
Analysis of the main purposes of financial management within the event industry:......................7
Critical analysis of relevant pricing strategies available to the event management company to
price its products in the industry:.....................................................................................................8
Critical analysis of CPV and break-even point for the particular event:.........................................9
Break even analysis:......................................................................................................................12
Recommendation:..........................................................................................................................13
Conclusion:....................................................................................................................................14
Reference.......................................................................................................................................15

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Introduction:
In the United Kingdom Julia Charles is well known event Management Company in all
over the world. The company specializes in managing different kinds of events including
entertainment events. Creativity and innovation are the two main aspects of the company’s
services and the management uses these two elements effectively to manage entertainment,
business and luxury events.
Though the company is based in UK the services of the company in relation to the event
management are stretched to different parts of the world. The company is credited for some of
the most creative event management services in UK with number of events for shopping centre
displays and entertainment events. The company takes pride in providing highest quality services
to manage different events as required by the clients of the company. The company has won
number of awards for providing creative event management solutions for the clients to satisfy
their requirements (Titman et al. 2017).
The company offers creative event management services and provides top quality
entertainment management services for the clients. The company has its own in-house costume
designers, planners for wedding, luxury event planners and designers to design prop to manage
events of different kinds. Thus, the company is well equipped to manage wedding parties, baby
shower parties, designer events, company product launch parties, entertainment parties and
events of any kind.

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Market research:
In this part of the document a detailed discussion shall be made on the findings from the
market research which have been conducted on the commercial viability of similar events and
the existing competitors of the company in the market.
Commercial viability of event management products:
Here the market research has been limited to the market in the United Kingdom since the
company’s majority of operations are limited within the boundaries of the country. According to
the findings of a recent study conducted on the UK event industry the industry is almost worth of
₤45.00 billion and currently supports almost 600,000 jobs directly (Barr and McClellan 2018).
The market research further provides that on an average event attendees spent ₤68,000 in annual
registration fees. In-fact just a year back, i.e. in the year 2016 the market research on the event
management industry showed the following results:

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Thus, within a year the industry has further expanded as the above findings were from a
research conducted in the year 2016. Thus, just above a year the industry has boosted by increase
in the number of jobs as well as total turnover of the industry that is a positive sign for the
industry and its growth.
The top ten UK event management companies have a combined turnover in excess of
₤3.5 billion and in the future it is expected to increase further. According to the 2015 study the
budget per event is ₤65,943. Thus, the findings from the above makes it amply clear that the
event management industry in the country and its products have significant interests and
popularity (Finkler et al. 2016). Julia Charles is a well-known event management company in the

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country however, there are number of competitors in the industry who are involved in providing
event management services in the country. Let us take a closer look on the competitors of Julia
Charles in the market.
The following organizations are the main competitors in the event management industry in
the country to Julia Charles:
I. Penguins Events
II. Seven Events Limited.
III. Papillion Events UK Limited.
IV. Eureka Events UK.
V. Oxygen Event Services Limited.
The above list contains only few of the event management companies of UK thus, there are
number of other companies which are in the business of event management however, not all of
these companies are in competition with Julia Charles event Management Company.
In this document the particular event that shall be discussed is the business conference and
meeting event to be held in London which will host top business executives from different parts
of the country (Matthew 2017). The main purpose of the event is to encourage the investors to
make investment in capital intensive projects within the country to create significant amount of
jobs in the country. The event will be held on the 6th day of August in 2018 at the O2 arena.
Since the event will be held to promote growth of industry and investment in the market along
with the top business executives of the country the representatives of the government of the
country are also expected to attend the event. The management expects that the required amount
of funds to finance the project would be around ₤750,000. Thus, the Julia Charles require an

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amount of ₤750,000 to finance the business conference and meeting in the O2 Arena on 6th of
August, 2018 (Gomber et al. 2015).
Sources of finance:
There are number of options which are available to an organization to arrange the
required amount of funds for financing different projects. In case of the event management
company Julia Charles there are number of options available which the company can use to
arrange the required amount of funds of ₤750,000 to finance the business conference. The
business can meeting in O2 Arena for encouraging the investors in the country to invest in
capital intensive projects to fuel the industry growth in the country (de Jong and Naumovska,
2015). Let us see the alternative sources of finance which the event management company can
use to raise the required amount of capital needed to finance the event management at the O2
Arena in London.
The sources of finance can mainly be segregated into internal and external sources. Let us
now elaborate a bit on the internal and external sources of finance.
Internal sources: Integral sources which the company can use include the following:
Excess amount of funds available within the company: Often companies have excess amount of
capital which have left unused after investments in different projects such excess amount of
funds can be used to finance the event in O2 Arena provided the company has such additional
funds available with it (Kothari et al. 2015).
Retained earnings: Retained earnings accumulated by the company over the years can be used to
finance the capital required for the business conference and meeting to be organized by the
company on 6th of August 2018 at an approximate cost of ₤750,000. It is important for any

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company to make profit over the years constantly in order to have the option of using its
accumulated profits, i.e. retained earnings for investment purpose in the future.
External sources: Large organizations are mainly reliant on the external sources to arrange its
required amounts of funds for investing in different projects (Pinkerton et al. 2017). Since the
required amount of funds is significant the company can use the following external sources to
arrange the required finance for organizing the business conference and meetings successfully on
the 6th of August, 2018.
Loan from banks: The Company can take loan from banks for financing the event at O2 Arena in
London. The required amount of capital ₤750,000 can be taken on short term loan since the
company expects to receive the whole payment for the event management after the successful
hosting of the event.
Issuing ordinary shares in the market: The Company can issue its shares in the market to arrange
the required amount of capital for investing in a project, in this case the business conference and
meeting to be held in O2 Arena (Achleitner et al. 2017).
Analysis of the main purposes of financial management within the event industry:
The main purposes of financial management within the event industry include but not
limited to the following:
Better use of financial resources: The financial management is the process of managing the
financial resources of an organization effectively. The financial management in event
management companies will lead to better use of financial resources provided proper steps of
financial management are followed taking into consideration the characteristics of business and
requirements of business (Mallen and Adams 2017).

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Optimum use of resources: Financial management is essential for any industry. Thus, it is
equally important for event management industry also as it is directly related to the optimum
utilization of resources (Egginton et al. 2016). The financial management in the event
management industry will help the event management companies to make optimum use of its
resources.
Minimizing the cost of operations: Financial management helps the companies in event
management industry to reduce the overall cost of operations. Thus, the companies and
organizations in the event management industry will be able to reduce the cost of operations by
using the steps and procedures mentioned in the financial management theory (Langdon and
Marsden-Heathcote 2018).
Critical analysis of relevant pricing strategies available to the event management company
to price its products in the industry:
Julia Charles Event Management Company is a well-known company in the industry and
is known for its creative event management for business product launches, shop displays and
entertainment projects. Thus, it is not like that the company is looking to make a mark in the
industry as it already has a strong market presence in the overall event management industry in
the country. However, the management of the company is looking to improve its financial
performance in the future by increasing its turnover and subsequently the profit earned from
business (Rane and AnjanaRaju 2016). The company wants to maintain a sustainable rate of
growth both in overall revenue as well as its profit. In order to increase the amount of revenue
the company will have to increase the number of events it manages year after year. The pricing
strategy of the company to price its products in the market will play a crucial role in determining
the quantum of events that the company will end up managing in the future years. Thus, it is

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important that the management uses an appropriate pricing strategy to price its products and
services to ensure maximum amount of revenue and profit for the company in the future.The
relevant pricing strategies in front of the event management company are explained below;
Penetration pricing strategy: In penetration pricing the company will price its product at
relatively low to attract more customers. Thus, the company shall charge relatively low price for
managing different event to increase its overall revenue in the future (Bessis 2015).
High pricing strategy: Exactly opposite to the penetration pricing strategy under the high pricing
strategy an organization generally charges very high prices for its products and services. Either a
new firm in an industry or an entity in manipulation market can use high pricing strategy. Thus,
in this case high pricing strategy is not an option for the Julia Charles Event Management
Company (Stone et al. 2017).
Strategic pricing: Under the strategic pricing an organization prepares costing statement to
determine the amount of cost of its products and services and then a particular rate of profit is
imposed on the amount of cost to determine the price of the final product and services of an
organization.
In this case since the event Management Company is a well-established organization and a
successful company in the industry the management should use the strategic pricing strategy to
achieve the dual objectives of sustainable growth in revenue and maximization of profit.
Critical analysis of CPV and break-even point for the particular event:
In this case the business conference and meeting event of 6th Augusts, 2018 is expected to
cost ₤750,000. Out of the above cost the fixed cost is expected to be ₤150,000 and the balance is
variable cost. The company expects to attract a total 5000 attendees for the event including

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business executives, government representative, investors and common people. Based on the
above let us analyse the cost profit volume and break-even point for the event.
Cost Profit volume analysis
(All amounts in the table are in ₤)
Number of expected attendees 5000
Expected fees per attendee 200
Revenue from entrance fees from attendees 1000000
(5000 X 200)
1000000
Less: Variable costs 600000
(5000 X 120)
Contribution 400000
Less: Fixed costs 150000
Expected profit from the event 250000
Thus, from the above cost profit volume analysis it is clear that the company is expecting
a huge profit from the business conference and meeting in the O2 Arena to be held on August 6,
2018. The company expects 5,000 attendees to attend the business conference and meeting in the

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O2 Arena on August 6, 2018. The expected attendance fees for the conference per attendee is
expected to be ₤200 and with a variable cost of ₤120 per attendee the company is expected to
earn a contribution ₤80 per attendee from the business conference and meeting (Bocquier et al.
2017). The following cost profit volume analysis will further help us to dissect the importance of
attendance in the conference and meeting to increase the overall profit.
Calculation of Contribution per unit
(All amounts are in ₤ in the table)
Particulars Amount
Expected revenue per attendee 200
Less: Expected variable cost 120
Contribution per attendee 80
Since the company is expecting to get a total attendance of 5,000 for the business
conference and meeting the company will be able to earn a contribution of (5000 X 80) ₤400,000
from the business conference and meeting on 6th of August, 2018. The company expects that the
amount of fixed cost that will be allocated to the event is ₤150,000 accordingly, taking into
consideration the amount of fixed cost the profit from the business event will be ₤250,000, i.e.
contribution less fixed cost for the event (Atkins et al. 2016).