This article was written in January, 1980 and contains dated information particularly on prices. The specific prices should not be used as a current standard for estimates.


Large Event Planning
I. Cost Analysis for Feasts

Janet of Arden

9. FIGURING OUT IF YOU'LL BREAK EVEN - AND HOW TO ADJUST

a. Initial figuring
You should now have some idea of the following:
  1. Fixed costs:
  2. Menu-cost per person
  3. A range of ticket prices that it would be reasonable to charge
  4. Approximate number of people you can expect to buy tickets
  5. Number of free tickets you provide - both official and gate-crashers.

Now for the juggling of figures: The hall cost is fixed, regardless of how many tickets you sell; this means that if you sell fewer tickets, your costs will be more per head. For example:
$200 total hall costs can be paid by:
200 people each paying $1 (food etc. not included)
100 people each paying $2
50 people each paying $4
etc.
As you can see, below a certain number of ticket sales, the costs per head will be more than you can reasonably expect to charge for the tickets, when $2.75 to $3.50 food costs (estimate based on 1979-80 cost of living) have been added.

You need to figure out how many tickets you need to sell at the price you have chosen as reasonable, in order to reach your break-even point, the place where income is sufficient to match expenses. If necessary, you will need to adjust your menu, substituting cheaper dishes for more expensive ones, until your costs per head are sufficiently low that you can charge a reasonable price for a reasonable number of people and still break even. If you cannot get the menu costs low enough, you will have to find a cheaper hall, or do a potluck instead. There is no reason to run an event at a loss!

In setting up your basic cost analysis formula, it is essential to remember that if you sell 100 tickets and in addition have 20 free passes (for cooks, entertainers, etc.) the money from the 100 who buy tickets must pay for the 100 plus 20 people who eat - that is, 120 people eat the food and enjoy the hall that 100 people pay for.

Let's take the example of 200 people, 180 paying plus 20 free, and a pie that costs $3.00 and serves 10. 3.00/10 - 30¢ cost per pie portion. However, 180 people pay for the pie portions for 200 people. 200 people eating, at 10 people per pie, mean 20 pies are needed, at $3.00 each, -$60.00 total costs for the pies.

Each of the 180 paid tickets must contribute to the total pie cost: $3.00 x 20 pies for 200 eaters/180 paying OR you can say 30¢ X 200 pieces/180 paying = 60.00/180 = 33¢ per paying ticket.

Thus each paying person pays 30¢ for his own piece, plus 3¢ towards the pieces eaten by those with free passes. Thus 33¢ of each ticket price received, NOT 30¢ must be allocated to paying for the pie.

Remember, those who buy tickets have to pay for themselves plus for those who get free passes.

The basic cost-analysis formula, therefore, is:

Total cost = fixed costs + (per head costs x no. of paid tickets) + (per head costs x no. of free passes)

THEREFORE

cost per paid ticket = (fixed costs + (per head costs x total eating))/no. of paid tickets

That is, cost per paid ticket = total cost of event divided by the number of paid tickets. If your ticket price is going to be $5.00 and your cost per paid ticket for the number of tickets you think you can sell turns out to be $5.30, you are going to lose money on that event.

A simplified example:

If a hall costs $95 and printing costs are $5, if food and kitchen costs are $3.00 per head; if 100 tickets are to be sold and 15 free passes given out:

Total cost = (95 + 5) + [3.00 x (100 + 15)]
= 100 + (3.00 x 115)
= 100 + 345
= $445
Therefore cost per ticket sold = 445 divided by 100 paid tickets = $4.45 per paid ticket.

At this event you could safely charge $5.00 per head IF you sell all 100 tickets.

Some sample figures for the 1980 An Tir Twelfth Night are given on the next page (Fig. 6):

Notebook: EFFECT OF NO. OF TICKETS ON COSTS - Adiantum 1980 Twelfth Night

  1. Fixed costs: Cost of hall at Lane County Fairgrounds (includes main hall plus side room for one day, plus kitchen for two days $225.00

  2. Costs per paying head:
Food plus kitchen (including cooks' petty cash)
Autocrat's miscellaneous expenses (ticket printing, etc.) and petty cash
$3.14 per head
.25 per head
____________
$3.39 per head


  1. Cost for 100 paying people plus 20 free helpers (= 120 who eat)
    Hall cost
    Misc. 25¢ X 100 tickets
    Food $3.14 x 120 who eat it

    Total cost of event =
    $225.00
    25.00
    376.80
    _______
    $626.80
    626.80
    ---------
    100 paid tickets
    = $6.27 ticket
    cost per
    paying person

  2. Cost for 115 paying people plus 20 free helpers (= 135 who eat)
    Hall cost
    Misc. 25¢ X 115 tickets
    Food $3.14 x 135 who eat it

    Total cost of event =
    225.00
    28.75
    423.90
    _______
    $677.65
    677.65
    ---------
    115 paid tickets
    = $5. 89 ticket
    cost per
    paying person
  3. Cost for 155 paying people plus 20 free helpers (= 175 who eat)
    Hall cost
    Misc. 25¢ X 155 tickets
    Food $3.14 X 175 who eat it

    Total cost of event =
    225.00
    38.75
    549.50
    _______
    $813.25
    813.25
    ---------
    155 paid tickets
    = $5.25 ticket
    cost per
    paying person
  4. Cost for 155 paying people plus 30 free helpers (= 185 who eat)
    Hall cost
    Misc. 25¢ X 155 tickets
    Food $3.14 X 185 who eat it

    Total cost of event =
    225.00
    38.75
    580.90
    _______
    $844.65
    844.65
    ---------
    155 paid tickets
    = $5.45 ticket
    cost per
    paying person
  5. Cost for 200 paying people plus 20 free helpers (= 220 who eat)
    Hall cost
    Misc. 25¢ X 200 tickets
    Food $3.14 x 220 who eat it

    Total cost of event =
    225.00
    50.00
    690.80
    _______
    $965.80
    965.80
    ---------
    200 paid tickets
    = $4.83 ticket
    cost per
    paying person
  6. Cost for 200 paying people plus 25 free helpers (= 225 who eat)
    Hall cost
    Misc. 25¢ X 200 tickets
    Food $3.14 x 225 who eat it

    Total cost of event =
    225.00
    50.00
    706.50
    _______
    $981.50
    981.50
    ---------
    200 paid tickets
    = $4.91 ticket
    cost per
    paying person
  7. Cost for 200 paying people plus 30 free helpers (= 230 who eat)
    Hall cost
    Misc. 25¢ X 200 tickets
    Food $3.14 x 230 who eat it

    Total cost of event =
    225.00
    50.00
    722.20
    _______
    $997.20
    997.20
    ---------
    200 paid tickets
    = $4.99 ticket
    cost per
    paying person


Fig. 6. Effect of Ticket numbers on Costs - Adiantum 1980 Twelfth Night (page from my notebook)

As can be seen in Fig. 6, at the $6.00 we are charging for this event, if there are 20 free tickets given out, our break-even point would be just below 115 people, with almost no safety margin (Example B). If we allow 75¢ per paid ticket as a good minimum safety margin (this will get reduced a little later with the fine adjustments), we will be safe charging $6.00 for this event ($5.25 for costs plus 75¢ for the safety margin) if we sell 155 tickets (Example C). However, if we give away more than 20 free tickets the costs per paid ticket rise considerably (as can be seen by example D).

Our hall's maximum capacity is about 200 to 220. Example E shows that with only 20 free tickets we would have to sell for $5.65 at least (allowing a 75¢ safety margin), IF we sold all our tickets. As we may have a few more than 20 free passes, and also may not sell out, we figure we will be safe if we sell our tickets at $6.00. As this is only $1.00 higher than the Madrone Twelfth Night of two years ago (at which the 150 available feast tickets WERE sold out), and since in addition we have put on fairly good feasts over the past 5 or 6 years (selling over 200 $5.00 tickets at the An Tir Twelfth Night we put on 3 years ago), we are fairly sure that we will sell all of our tickets. Please note that this is a realistic prediction and not merely a hopeful one! (Editor's note: we sold out on January 2, 10 days before the event.)

The figures tell us that we will not have to juggle costs to enable us to charge lower ticket prices, for this particular event. (Sometimes a lot of adjusting may be necessary.)

b. Major cost adjusting, if necessary
If the initial cost analysis gives you results that require your charging a higher ticket price than you think sufficient people will buy, you must make the following changes in your plans to lower the costs to the point where your ticket prices will be reasonable:
  1. substitute cheaper dishes for items on your menu (and this can only be done within reason, or the meal will be a poor one - this will be discussed in a future article), and re-do your cost analysis OR
  2. find a cheaper (and alas probably smaller) hall, and re-do your cost analysis for the menu and numbers possible with the new hall's kitchen facilities and seating capacity.

If neither of these works, abandon the idea of a catered, paid-ticket feast, and put on a potluck or a partial potluck dinner instead.

At this point it becomes obvious why it is CRITICAL to have an accurate estimate of the number of tickets you can be expected to sell at your event, given the type of event, your location and reputation, and the ticket price you have in mind (see sections 3 and 4 above). If you overestimate the number of sales you think you will have, you may not reach your projected break even point and will lose money even if you HAVE done all the other cost analysis suggested above.

c. Fine adjustment of costs
So now you have the cost per paid ticket for a variety of numbers of paid plus free tickets (Fig. 6), and know that your plans are reasonable.

At this point, having decided finally on how many tickets you intend to sell and how many free passes you will be giving out, you need to do some fine adjustments to the costs of each recipe, as follows:

i. Dishes with particular serving problems:
Some large dishes (whole pies, turkeys, loaves of bread, etc.) cannot easily be divided before serving. If you are seating people at one long continuous table, it is easy to plunk one pie down for every 10 people. However, if you use separate 8-person tables, you have to serve 1 pie per table. That is, 8 people get a 10-person sized pie. You CANNOT serve 8/10 of a pie with a wedge missing to each of several tables, and a plate with several of the cut-out wedges on it to another table! So, you serve a 10-person pie to 8 people, if you cannot find an appropriate-sized pie-plate to make slightly smaller pies. This means that you'll be making a few more pies than you thought you would need, which is going to increase the cost a little.

In addition, with these dishes where one whole item is served per table, you we ill want to make a couple of spare pies, or loaves, etc. (One might get dropped at the last minute, or burnt, or at the last minute an extra table has to be set up.).

ii. Multiplication of recipes:
Recipes do not necessarily multiply up to the exact number of people whom you are feeding. (Have you ever tried to make 17-11/16 recipes? Cookie recipes are especially bad in this respect; how do you measure 11/16 of an egg? Also, all those 5/16 of an orange, or an egg, etc. mean food wasted.) You usually make up the nearest number of whole recipe multiples (or sometimes half multiples), in this case you would make up 18 instead of 17-11/16 recipes. This means that you actually make food for a few people more than you are actually seating, which will increase the cost per head a little. If you make up the recipe to the nearest number of multiples LESS than the number of people you are seating, in this case 17 instead of 17-11/16 recipes, you may run short of food (especially when the recipe makes 2 meatballs, or 3 cookies per person!)

All of these factors affect the final cost per paid ticket of that dish a little. The original menu cost table, made when you were not sure how many people you would be feeding, was worked out as cost per head based on cost of each single recipe (Fig. 5); this cost per head, added up for the entire menu, was then multiplied by various numbers being fed to get a figure for calculating ticket costs. Being based on cost per head, it made no allowance for extra pies or an extra 5/16 recipe, or for any extra people allowed for; a factor which varies with each recipe. Thus, to make sure that your cost per paid ticket is not changing significantly without your knowledge, at this point you adjust the costs item by item throughout the menu to reflect these individual situations, and arrive at a final adjusted cost figure based on total cost (including extra people, pies etc.) of each recipe, rather than on the menu cost per head multiplied by the exact number of people being seated.

A couple of examples illustrate this. Let us say that you have 200 people (180 paid plus 20 free passes), and 20 tables each seating 10 people. Among a number of other dishes, you are serving a pie and a salad.

(I) Your pie recipe (which makes one pie) feeds 10, and costs $3.00 to make. Each portion costs $3.00/10 = 30¢ However, 180 people pay for the pieces of pie (200 portions) that are going to be eaten by 200, so 30¢ x 200 eating/180 paying = 20 pies x $3.00 per pie/180 paying = 33¢ per paid ticket. You will want to make a couple of spare pies (for emergency use). This means, instead of making 20 pies, that you will make 22. However, the number of people buying tickets is still 180, and the cost of each of the 22 pies is still $3.00 per pie.

Cost per paying ticket now = 22 pies X $3.00 per pie/180 paying for them = 37¢ per paid ticket.

Thus the extra two pies are costing (37¢ - 33¢) = 4¢ more per paid ticket. This increase is not included in the initial cost table (Fig. 5) for reasons mentioned above.

(II) Salad: one recipe feeds 21, and costs $2.10. It thus costs $2.10/21 = 10¢ per paying ticket.
9 recipes feed 21 X9 = 189 people.
10 recipes feed 21 X10 = 210 people.
1/2 recipes feed 21 X9-1/2 = 199-1/2 people.
However, 9-1/2 recipes uses 9-1/2 oranges, 9-1/2 lemons, etc. which means food wasted. Rather than make 9 recipes and risk being short of food, it is better to make 10 recipes. If we were really uncertain about the quantities we thought people would eat, we could even make 11 recipe batches instead of 10, just to make sure. The cost of the extra 1/2 or 1-1/2 recipes needs to be worked into the cost per paying ticket, as follows:
9-1/2 X $2.10
------------------- = 11¢ per paying ticket.
180 paying
10 X $2. 10
--------------- = 12¢ per paying ticket.
180 paying
11 X $2.10
--------------- = 13¢ per paying ticket.
180 paying
So the extra 1-1/2 batches cost 2¢ more per head. If money is tight, we tend to make extra batches of the inexpensive items, like bread, and not so many extra batches of the most expensive items (unless they are non-divisible, like pies.)

These 2¢ and 3¢ can add up on the total cost quite considerably, so at this point I draw up a table using the format of the one shown below (Fig. 7), showing recipe, number it feeds, cost of one recipe, the number of recipe multiples we will be making and the number of people that will feed, and the total cost of that number of multiples. On this new table (not shown in this article), the adjusted cost per paying ticket was now $5.35, considerably higher than the initial estimate we made of $4.91 per paying ticket for 200 tickets plus 25 free passes (the figure we finally agreed upon for the 1980 Twelfth Night.)

Note: the fine adjusting is not done earlier to the recipes, as it would have to be done in detail for each possible set of ticket and free pass numbers you are considering for your event; the approximate costs we used earlier are adequate to give a rough idea of where you will break even, with the 75¢ safety margin for the adjustments.

d. Second fine cost adjustment
It is possible that the above adjustments may increase your costs per paid ticket almost up to your sale-price. In the first approximation of break-even points, we allowed 75¢ so that there would be room for adjustment. There should still be a 50¢ safety margin AT LEAST! for unknowns; if there is not, adjust your menu at this stage, substituting cheaper dishes for expensive ones, or cheaper ingredients for expensive ones, or adjusting quantities of some of the dishes, until your figures work. In the 1980 An Tir Twelfth Night, the first set of fine adjustments brought us up to $5.35 cost per $6.00 ticket (from an estimate of $4.91; you can see how the cost creeps up). We felt that this was too close for comfort, so we made several adjustments, as follows:

Firstly, in the pear recipe we found that we could reduce the amount of wine for simmering pear halves by 1/3 (the recipe called for red wine OR water, and we changed our initial plan of all red wine to 2/3 wine and 1/3 water). In addition we were able to reduce the amount of Muscatel wine needed for syrup from 1-1/2 cups to 1 cup per recipe. These changes saved us $20.42; 10¢ per paying ticket.

Secondly we used margarine instead of butter to make the Circletes cookies (we tested the cookies both ways, and no-one could tell the difference in this particular recipe), which saved an additional $7.68; 4¢ per paying ticket.

Thirdly we found we could reduce the meatballs in almond milk from 19 to 18 recipe multiples, saving $4.01 - 2¢ per paying person, and the lamb n'lentils from 13-1/2 to 13 multiples, saving $3.49, 2¢ per person.

Revised Cost Table (Adiantum 1980 Twelfth Night)
RecipeNo. people one recipe feedsCost of one recipeTIMES No. of recipes we'll makeFeeds No. of people***Total Cost
(1)Renaissance salad24$6.11x 11264$67.21
(2)A carrot salad71.15x 3424839.10
(3)Pickled cucumbers61.08x 4024043.20
(4)Honey-oatmeal bread25 *1.40x 1127515.40
(5)Manchets (bread rolls)160.44x 152406.60
(6)Galantine Pie9 to 10*3.57x 2725696.39
(7)Meatballs in almond milk on rice145.72x 18256102.96
(8)Lamb n' Lentils (Mawmenye)196.94x 1324690.22
(9)Cheese n' vege pie9 to 10 *1.77x 2725546.44
(10)Pears in confection123.92x 2125082.32
(11)Circletes (cookies)163.00x 1625648.00
(12)Cheese, med. sharp cheddar362.29x 7-1/226017.18
(13)Plum conserve45 to 50*3.45x 625620.70
(14)Margarine19.69x 13-1/22609.32
(15)Salt27.39x 62502.34
(16)Water9 to 10*.15
(jug)
x 272564.05
(17)Misc. food-decorating items (not sure what yet)--------5.00
(18)Aluminum pie-plates, 5 per table9 to 10 *.89x 2725624.03
(19)Misc. kitchen needs (soap, etc.)--.10----**20.00
(20)Cooks' petty cash--.10----**20.00
TOTAL FOOD + KITCHEN760.46
(21)Autocrat's misc. + petty cash--.25----**50.00
(22)Fixed costs:- Hall rental--------225.00
GRAND TOTAL1,035.46
No. of paid tickets = 200
No. of free passes - approx. 25
No. of people per table - 9 or 10
No. of tables = 25
1,035.46
------------------- = $5.17 cost per paid ticket.
200 paid tickets
* These items are figured on a per table rather than on a per person basis. 9 or 10 sit at one table.
** These item' are figured by multiplying cost per head by number of paying tickets, NOT by number of people eating. It is probable that not all of these miscellaneous and petty cash amounts will be used. (For this event I estimate that half of each of these will be returned, = $45. $45/200 = 23¢ less cost per paying ticket. However, as we cannot COUNT on any of this money not being needed at this stage it is all included as part of the cost.
*** Extra food: where items are figured per table and not per person, we allowed 2 extra tables' worth. Where they are figured on a per person basis, we allowed 15 to 30 extra people's worth. Extra pies etc. can always be auctioned off during or after the meal.

Fig. 7. Final Cost Table, 1980 Adiantum Twelfth Night (page from my notebook)

All of which nickled and dimed our cost down to $5.17 per paid $6.00 ticket. (We believe in large safety margins.) Fig. 7 (above shows the final costs, after we had done all of the above adjusting.

Continue to Part 5.

© 1980 Janet Naylor


Return to Introduction, Part 2, Part 3

Last updated 12/19/97.

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