Planning & Promotion

Run Optimized Events: Navigating Escalating Fuel Costs in 2022

Eventually Learning Team

“Fuel Prices are at the center of our lives!”- Robert Kiyosaki

While COVID-19 bought a slump in event attendance for the past two years, in 2022, the in-person events are finally projecting a positive outlook. Also, the rising sensitivity towards keeping sustainable event landscapes is optimizing budgeting spreadsheets more than ever.

A major factor throwing off resurgence of live event operating costs is the rising fuel prices. Deep diving, the oil price has jumped by more than 60 percent from $68 per barrel in the latter part of 2021 to about $110 in the present times. The jet fuel prices have zoomed by almost 50 percent since December 2021.

The fuel cost sways almost all aspects of an event budget – from A/V rental equipment deliveries to catering charges. Under such contraints, event rental companies with truck fleets as many as 70, have no other option but to bill higher or add exclusive fuel surcharges to organizers! Also, when gas prices are through the roof, inflation directly affects the prices of all other event planning components as well.

Are Airfares Roadblocking Return to F2F Events?

The airline fuel cost and airfare spikes has bought event planners to analyse its impact on international event attendance. One good tactic that event planners are using to combat airfare hikes is early 2022 event booking, so that attendees can block flight tickets way far in advance. Another way around is choosing hedged airlines with long-term-fuel-buying-contracts that lock prices against higher present fuel rates. These airlines mostly have a fleet of new aircrafts or engines. Thus, event planners are consciously handpicking event destinations that have strong traffic from the new fleet flying airlines!

Managing Power Consumption At Outdoor Events

Diesel-powered generators are one of the major production costs to a medium or large-scale outdoor event. To make fuel usage concessions, event planners are mapping on-site power consumption or choosing low energy equipments and sources for example LED lights and jump-starting alternative power initiators like solar panels and hybrid battery storage power! To cut out the rising expense, organizers are also educating event team members about switching off electrical equipments and cooking gas at business events or festivals to save money, energy and fuel.

Shrinking Geographic Coverage to Optimize Spends

Event Production teams that served larger area coverages are shrinking their geographic boundaries or choosing virtual event media deliverables to cut down some major trucking costs. The scenario is such that even to logistically more around a few equipments, and with inter-city travel in the picture, staying competitive with local providers is a tough nut to crack with rising fuel cost structures!

This brings constraints to margins, so event organizers are ideating more teeming local and regional business events as a direct consequence, as opposed to major trade shows or conferences in centrally located big cities. Another thought process - is abandoning costly event venues and destinations for budget second-tier city venues. This significantly reduces all projected costs such as the accommodation and legal documentation charges as budget locales are not as financially weighty as those in prime cities.

In fact, event companies are more intent today on launching their event at one central location and then its concurrent satellite events at regional locations with less audience strengths, to optimize spends.

Do Fuel Costs Affect Event Sponsorships?

Ballooning gas prices have a domino effect on all variables of events & conferences, as they push up costs at every stage of event production. As mentioned above, increasing airfare bills and trade show ‘booth’ transportation charges eat into event budgets. Adherence to event catering safety standards & deliveries during the pandemic and addition in courier fees has also had a net negative consequence on various components of event fund allocations – thus keeping less sponsorship dollars and sponsors keen on investments.

The Way Ahead Is Getting Net Zero with Sustainability Initiatives!

Since July 2021, the software giant Microsoft has increased the internal price of carbon by 600%. Doing the math, if a Microsoft employee has to attend a business event that warrants air travel, along with the usual $100 per tonne internal fee, another $150 are being added now to the attendee’s total flying cost.

The reason Microsoft and other companies took such a decisive action could be The Paris Agreement that insists keeping a check on rising global temperature and limiting it to strictly below 2 degree Celsius! The U.S Securities and Exchange Commission has also recently proposed on the public disclosure of public limited companies’ greenhouse gas emissions, that could be passed into law soon. United Nations is also pressing on analysis of net-zero plans of companies and cities to avoid greenwashing – the term coined when companies publicly feign sustainability; but the reality falls far short of expectations.

Thus to cut out on global emissions, global brands and companies are now trying to consciously devise carbon footprints into a cost structure, relating it to the corporate social responsibility wing of their brand. Event companies are handpicking venues with sustainability accreditations and onsite energy & waste management programmes.  Event Planners are avoiding long-haul aviation by preferring digital or hybrid events. With localized Hybrid events on the horizon in 2022, adopting plastic bans, sharing digital in-event, zero paper communications and drawing up sustainable event registration designs is every event planner’s vision forward. 

Thus, from a long term perspective, the event’s industry refinements owing to pandemic or rising fuel costs or climate change are indeed sculpting the event industry day-by-day to a more streamlined and sustainable one!

Frequently Asked Questions

What is Day Delegate Rate (DDR)?

Day Delegate Rate (DDR) is usually billed by an event venue per attendee basis, per event day, based on a full day’s conference or business meeting. As per the venue guidelines, this can be inclusive of meeting room hiring, lunch and refreshments and the event equipments as well.

What are some line items that Event Planners forget to add in their Event Budget?

Some line items that Event Planners forget to include in their event budgets are airline transaction fees, conference calls, attrition costs, wire transfer fees, service charges, room drops, taxes, tips and gratuities, amongst others.

What are Concurrent Event Sessions?

At big sized-events, event planners often also simultaneously arrange for shorter educational meetings, better known as concurrent event sessions, each session focusing on varied themes and topics as per the attendee preferences.

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