Lighting, sound, labor... it's all part of your AV bid but what's the bottom line? How much does event AV cost? Do the brands of equipment really matter? What can you look for to make sure you are getting a good and fair price? If these questions come into your mind when planning events, you are in the right place. Today, Will Curran will walk you through all about event AV costs. He will go into the many complex parts, covering labor rates, why brands matter, why new equipment may cost more, video, lighting, scenic expenses, and more. After you watch this week's Whiteboard Wednesday, we are sure you will walk away with clarity on how to approach your event AV! How Much Does Event AV Cost? "How much does event AV cost?" is the most common question I get asked. There's no simple answer: event AV is very complex. There's a reason why those quotes are so long, full of equipment, different AV labor, etc. But even though event AV is complex and every single situation is custom, there are definitely some principles that apply across all quotes. By understanding them, you will get a general idea of how much event AV costs. Equipment: The 10% Rule The majority of the event AV budget goes towards equipment. There are some principles regarding the equipment. I call one of them the 10% rule and it applies to nearly all AV companies. The 10% rule means this: whatever the cost is to buy a piece of equipment, your AV company is charging you 10% of that. For example, if it costs $1,000 to buy a camera or a speaker, then the AV company is charging you 10% of that. They're usually making their money back on the equipment within 10 rentals or events. Depending on the piece of equipment, the percentage may vary from 8 to 15%. It depends on the lifespan of the equipment and how long it's going to be on their shelves. Older Equipment Costs Less If you're ever looking at a quote and you notice that this AV company's mixer is much cheaper than other company's mixer, chances are they're charging you for a cheaper model. If you Google the model name, you might find that that model of mixer that they're charging you for came out in 2000 whereas the new one just came out this year. Older equipment is typically less expensive because they've already made their money back on the rentals. This 10% rule really has to do with the lifespan of the equipment as well. For example, projectors don't usually fall into the 10% rule because projectors have a very short lifespan. Technology gets old very, very quickly. Projectors also tend to break very easily. What that means is AV companies want to make their money back faster. In this case, the AV cost can be as high as 20%. Event AV Cost: Equipment Brands Matter! We have this great analogy of Chanel versus Walmart. These two brands are not the same in any sort of way. You might be able to get a good deal with Walmart but it's not the same as Chanel. The same concept applies to AV equipment as well. Nicer brands typically cost more money. So, if you are ever looking at a piece of equipment and you're wondering why a company is charging you $1,000 for something that another AV company is charging you $4,000, look at the brands of the companies. Are they reputable? Have they been around for a long time? Do they service large-scale events? It's also a good idea to ask your AV company about different brands. You shouldn't have to figure out all this on your own. Here are some questions you can ask: Why did they choose that brand? Is it better? Does it sound better? Does it look better? Is it going to last longer? How does it give me more features for what I'm trying to accomplish? Remember: Video Is Expensive Video is by far the most expensive area when it comes to event AV costs. Why? Video is very sensitive. You have to have certain types of adapters, the right type of switcher, and so on. It hasn't been around as long as audio has. If you're looking at doing something ambitious, such as multiple screens and LED screens, chances are a lot of it is going to be spent on the video. Lighting Lighting, too, is an area where you'll be spending a lot of money. Lighting equipment is changing fast, but not as fast as video. Additionally, things tend to last longer. LEDs are popular now and they're in almost every lighting fixture. Today, they're not as expensive anymore. Whereas before, if you wanted an LED light as opposed to a conventional light, your event AV costs jumped higher. Audio Costs The next area that you will end up spending your AV budget on is audio. Audio hasn't changed over the years. A 1,000-person concert from the past is the same thing as a 1,000-person concert today. Obviously, there are newer, cooler things constantly coming out. But audio tends to be less expensive than most of the items because it lasts so long. The speakers that we used 10 years ago work just as well today. Labor Costs When it comes to AV labor, there are different concepts that you should understand, such as labor rates and hourly rates. Labor Rates Expected labor rates move anywhere between $50 and $100 per hour. Again, this depends on the company and the region in which you're working. If you found out that your labor is really expensive, it might be because the cost of living's very high in that city. Usually, the $100/hour people are really advanced and educated. They're usually your technical directors, producers, and event managers. Closer to the $50/hour are your engineers, technicians, the people on the ground who build sets and tune sound systems. Full-Day Rates You might be thinking to yourself, "Okay, cool. Well, my conference is three hours long." Well, there's another rule that you need to understand: a 10-hour day rate. Everything is billed at a day rate or a half-day rate. But in California, for example, a day rate is actually eight hours,. Make sure you talk to your AV company. Ask them how many hours are in a day rate. Let's say your conference is seven hours long. Instead of getting billed just for those seven hours, you're also going to get billed for a total of 10 hours. What they do is they always round up to the nearest 10th hour. Half-Day Rate There are half-day rates as well. It's half of a full day, so five hours. Everything usually gets billed at that half-day rate when it comes to AV labor. If your event is 12 hours long, round up to 15. If your event is 28 hours, round up to 30. So when it comes to your labor, you can do some rough calculations. So for example, if you're in a really expensive market, you can always budget really high. Maybe you budget $85 per hour and your conference is going to be 30 hours long. Let's say you budget 10 hours for setup and 10 hours for loading. Now, you're at 50 hours total. Event AV Cost: Markets Matter When it comes to your final event AV cost, it's not enough to just consider the cost of the equipment and labor. You also have to consider your location. In big cities, such as Chicago, New York, and LA, there are a lot of events going on. So, therefore, there's a lot of AV companies supplying those events. What this means is that typically in larger markets, costs are lower. In smaller markets, costs are higher. And you think to yourself, "Well that doesn't make any sense at all. Shouldn't it be cheaper for me to go to a smaller market where there's not as much going on?" No, not exactly. The more demand there is, obviously there's going to be more supply to fix it as well. So what that means is in these large cities, AV companies are all fighting for the same pie. They're all trying to win on price, which means they're driving their costs down. Bigger Markets Mean More Choice You have more choices in bigger markets. In a small market, you only have one or two AV companies to work with, so they get to dictate the prices. So when it comes to doing your events, picking your location is incredibly important because if you're choosing smaller markets, it might be more expensive to get to. For example, our company had a client who was looking to do an event in Pella, Iowa. You've probably heard of Pella Windows and Glass. They were having a big party and they needed to have a big production. Well, turns out there's only one AV company in Pella, Iowa. With our company, we had to bring all the equipment in since we don't have a location there. We had to ship all of our equipment out of Chicago, which meant a very high trucking cost. Having to move equipment into a smaller market might be more expensive even if there is a large market like Chicago nearby. If you're in the middle of New York City, people can get you equipment all day long. Larger markets sometimes have AV unions and usually have higher costs of living. So, therefore, labor might be more expensive, but in smaller markets, equipment is harder to get to. Labor, however, might be cheaper, though. Event AV Cost: The Bigger The Event, The Bigger the Price Tag The larger your event gets, the higher the event AV cost. If you have 500 attendees versus 1,000,the event might need more sound and bigger screens. You might need additional support or more breakout rooms. The best thing you can do is talk to your AV company. Ask: "If I'm worried about these event AV costs as my event grows, how can I keep them under control?" They should be able to give you some really good tactics. Conclusion All right, I think I covered everything when it comes to event AV cost. This is a complex topic like I said, and there's just a lot going on when it comes to the cost of AV. But my hope is that these general concepts help you get a little bit better grasp as far as where you should be spending your money. Where is the cost going? What do these brands have to do with it? All this sort of stuff all coming together, this big gigantic mess. But the biggest feedback I have for you is to work with your AV company as a partner. They should be able to help explain your concerns regarding event AV costs. Again, if you are looking to get a very specific cost, how much does it cost for my 500 person event with three breakout rooms with a general session with cameras and this and that? The only person that's going to be able to give you the answer is the AV company. So, feel free to talk to us. Ask questions and get educated about all things AV. We'll see you next time on Whiteboard Wednesday.