How to keep a project to budget
In the third of a series of blogs, written for the Sport and Recreation Alliance and their membership, we provide guidance on how to keep a project on financial track.
Managing projects and department budgets is a heavy part of day-to-day business. Managing a budget that has been assigned before any work has been estimated can result in under or over estimation from both sides of the design brief. It is important therefore, to understand what that budget stands for and how to prevent an agency seeing pound signs or taking creative shortcuts because the budget is constrained.
Whether a budget is spiralling out of control or you are struggling to comprehend how much a particular service is worth, it important to think about the following when approving a budget or estimate;
- Ensure that the budget you have set or been given is realistic to the design agency you have selected. If you have not yet selected an agency, ask your shortlist to each specify a ball park figure for the type of project you wish to brief them on.
- Have clearly defined phases within the schedule of work – at each phase ensure all deliverables have been accounted for within the original budget as outlined by the agency in their proposal.
- Provide content and copy that’s pre-approved before sending to the designers to use. A staggering amount of hours can be used up going back and forth on author’s amends because copy hasn’t been adequately copy written or proofed.
- Use a tracker system to track progress and ask for reports from your agency when they feel there is scope creep which can push the boundaries of a budget.
- Design agencies are happy to work on a time and materials basis as well as set proposals or retainers, ask for timesheets so that you can assess how long some activities are taking. This can also help you to understand timescales on future projects.
- Retention agreements can be given to allow for project completion snagging to be carried out, keeping agencies and contractors invested to see the project through before final % invoice is paid (usually 5% but can be a proportion of the overall invoice cost).
- Expect deposit invoices when working with new agencies, this is to ensure that you have engaged them to begin work on the project giving them confidence and establishing a good commercial relationship.
Agencies often require working capital as invoicing processes can take time after stage completion. PO’s, stage payments or monthly payments can also be agreed to avoid surprises and any final lump sums.
Constant communication throughout the lifecycle of your project, along with a good working relationship with your agency will help every aspect of budget management.