Prepare the budget in a way that you can defend every hour

In the creative sphere, the term "Budget" is used on a daily basis. Whether it is a tender, a market survey, or a direct assignment from a client. We have to know the budget for everything we are going to do. It often happens that to the question "What is your budget" we hear from the client  answers like:

"Don't worry about it, we don't want to limit you"

Or

"We don't have any. Just prepare something to be great"

These kinds of answers are "loved" by every experienced account manager/director or team leader. In any case, you have to know how much the budget is. How much money does the client have for this campaign or any assignment?

If we already know the budget, we can start preparing it and defining the budget structure. Every account manager or agency has its own "recipe". But there are still a few general points to think about.

• Transparency
• Structure
• Description
• Price of agency work
• Commission
• Rights of use

All points contribute to what the "final" version looks like for the client. Of course, the more complex the assignment (e.g. product launch), the more demanding the budget preparation. More demanding, not more difficult. This is important to note.

By this, I mean that every quotation must be readable and understandable to the client. 

Why? The client needs to know what he pays for. That is why it is important to:

• Get an advice from more senior account managers
• Get inspired by existing budgets
• Think about the structure before preparation
• Communicate with the team to get the right estimates
• Ask for feedback from the account director/team leader

Combining all these points into a time slot for budget preparation is unimaginable. There are several solutions to prove it. One of them is Allfred .

It automates budget creation by offering a selection of already created budget templates or selected sections from more senior colleagues.

Thanks to this :

• You will not forget to include to the budget what belongs there
• You do not have to create a new estimate and guess "how much will it cost?"
• You can see the structure and the description of the work, which you don't have to write again.
• You will not forget to include external suppliers in the budget
• You get feedback in the description of each section.
• You can see if the budget is internally approved = I can send it to the client

At the same time, if you receive negative feedback, you can process it and prepare a new version for approval. You can easily access each version of the budget. 

There are no set rules for how to structure the budget in a way that the client always approves it. What the client presents is different, different thinking. That's why you have to realize for whom you are preparing the budget: It needs to be tailored fit and you always need to know your audience, so it is important to consider the following:

• Does the client want to see our work charged for hours?
• Does the client understand what the commission is?
• Can I charge the client a commission at all?
• Does the client expect a detailed description of works and sections?

Many variables enter the structure. Therefore, it is most effective to structure the budget In a way that all parties clearly understand what are the next steps.

For example, you can go the "Let him see it globally" route. Here, the entire campaign/project is visible in one section. You describe it and rely on the fact that the client is familiar with it and approves the offer.

The other approach is to prepare a structured budget "Budget approved by itself", where you will take the first step towards becoming your client's favorite account manager.

One assignment, two different approaches to budget structuring.

The difference is that in the first budget type, all parts are in one section. What opens the door to questions from the client such as "How much will the Microsite cost?" Does it contain the domain as well? In the process, do you also plan any meetings to check up on the status?" And similar questions. It reduces confidence in your ability to process the assignment correctly and effectively.

The second approach is structured according to logical sections. The client can see point by point what does it contain, e.g. Microsite. What will you pay for social media management and so on. They can also see which people will participate in it. 

Both approaches have their pros and cons. Allfred recommends structuring your budget, i.e. 2nd approach.

Some of The reasons are:

1. Proving to the client that you have it firmly in your hands
2. You know what will be done in which part on your side
3. Space for "budget cut", i.e. if the budget is too big you cut out a specific section. But you cannot strike out the lines. Those are the jobs that need to be done to deliver this “section” in expected quality.
4. You save time when preparing a new version or incorporating comments into the budget.

However, these approaches have one thing in common. After sending the budget for approval to the client, always go through the budget with the client by phone. Point by point. Eliminate space for misunderstandings. At the same time, the account manager is also a bit of a businessman and knows how to "sell" something that the client would reject because of the price or lack of understanding. 

Account managers, team leaders, and everyone in the creative business know well that time is precious. Therefore, work efficiently and make budget preparation easier with templates, templates from colleagues, etc. So these budget preparation and budget approval were quick and painless (the fewer versions, the less pain). In Allfred , you have it all solved in one place.

In the end a piece of advices  from team leaders Matej Paluš & Katka Poláková from TRIAD Advertising:

1. “Consider the budget as a TO-DO list. The structure of the budget reflects what you have to do, and how to do it. (thanks to the budget you also know which people are going to participate in it). Secondly, keep a savings buffer. If the graphic designer estimates it will take 8 hours, write down to  allocate 10 hours.”
2. “Prepare the budget in a way that you can defend every hour you put into the budget.”