How companies buy events

Companies buy events through several people, fixed budgets and approval rules that most event vendors never see. Learn the roles in a corporate buying group, the stages of a corporate purchase, and the budget and tax rules that shape what a company can spend.

Read the transcript

How companies buy events.

When a couple books you, the people who love the idea and the people who pay are sitting at the same kitchen table.

When a company books you, they may never meet.

The buying group.

Marketers call the people involved in a business purchase the buying group, sometimes the buying centre.

Even in a 60-person company, a holiday party touches several of these roles.

The stages of a corporate purchase.

Corporate purchases follow a predictable path.

Knowing where a buyer is tells you what to send.

Why companies prefer the safe choice.

A couple who books the wrong vendor has a bad night.

A champion who books the wrong vendor has a bad night in front of their boss and every colleague.

Policies that shape the budget.

Corporate budgets come with rules attached, and the best vendors design their offers around them.

A manager may approve spending up to a set amount alone, with anything larger needing a director or competitive quotes. Ask what the limit is.

Worked example: designing for the per-person cap.

Marco, who runs sales at Lantern and Lane, the illustrative west-end Toronto planning studio, is quoting a holiday party for an engineering firm with 120 employees, open to all staff, with partners invited.

The firm's finance team wants the party to stay within the CRA's non-taxable limit of 150 dollars or less per person, including taxes, where persons include spouses or partners.

That is the lesson. The worksheet and the quiz are just below this video.

What you will be able to do

• Identify the six roles in a corporate buying group and what each needs from you
• Match your marketing assets to each stage of a corporate event purchase
• Design a quote that fits a company's budget cycle and the CRA's rule on employee social events

When a couple books you, the people who love the idea and the people who pay are sitting at the same kitchen table. When a company books you, they may never meet. The person who wants the event, the person who chooses you and the person who releases the money often work on different floors, with different worries. Sell to only one of them and the deal quietly dies.

The buying group

Marketers call the people involved in a business purchase the buying group, sometimes the buying centre. Even in a 60-person company, a holiday party touches several of these roles. In a large firm, each role may be a different person.

Most event vendors meet only the champion. That is fine, as long as you give the champion what they need to sell you upstairs: a one-page summary the decision maker can read in a minute, a reference from a similar company, and a vendor package that answers procurement’s questions before they are asked.

Five questions to ask the champion on the first call, in this order: Who else will be involved in choosing the vendor? Who signs off on the budget, and has it been approved? Does your company need several quotes for a purchase of this size? What does procurement need from a new vendor? What would make this event a success for you personally? The last question matters most. The answer tells you what the champion will be judged on, which is what your proposal must deliver.

The stages of a corporate purchase

Corporate purchases follow a predictable path. Knowing where a buyer is tells you what to send.

1. Trigger. Something creates the need: a year-end, a milestone, a product launch, a new office, a bad experience with last year’s vendor.
2. Budget. Someone confirms money exists. Often this happened months earlier, in the annual budget, and the amount is already fixed.
3. Search and shortlist. The champion asks colleagues, searches online and checks LinkedIn. Three vendors is a common shortlist, and some companies require three quotes above a set amount.
4. Evaluation. Quotes or proposals are compared, references checked, and the decision maker is briefed.
5. Approval and purchase. Procurement sets you up as a vendor and issues a purchase order or contract. Nothing should happen before this, including deposits.
6. Delivery and review. The event runs, someone reports on how it went, and that report decides whether you are invited back.

Match a marketing asset to each stage: a seasonal reminder for the trigger, a guide with real price ranges for the budget stage, a strong service page and LinkedIn profile for the search, a clear proposal and references for evaluation, a ready vendor package for approval, and a post-event report for the review.

Why companies prefer the safe choice

A couple who books the wrong vendor has a bad night. A champion who books the wrong vendor has a bad night in front of their boss and every colleague. Corporate buyers are therefore more afraid of risk than they are attracted by novelty. They choose vendors who have done the same thing for a similar company, who answer quickly, who are insured and who send tidy paperwork.

That shapes your marketing. Lead with proof, not with creativity: guest counts, industries served, timelines met, and a named reference willing to take a call. Creativity matters once you are trusted. Before that, it can look like risk.

Policies that shape the budget

Corporate budgets come with rules attached, and the best vendors design their offers around them. Common examples:

• Approval limits. A manager may approve spending up to a set amount alone, with anything larger needing a director or competitive quotes. Ask what the limit is. A package priced just under it can be approved this week instead of next quarter.
• Fiscal year-end. Money left in a department budget near year-end is sometimes spent quickly on events. Know when your clients’ fiscal years end.
• Taxable benefits. Employee social events are subject to a CRA rule on taxable benefits, which many finance teams use as a per-person budget cap.
• Payment terms. Many companies pay 30 to 60 days after invoice and dislike large deposits.

Worked example: designing for the per-person cap

Marco, who runs sales at Lantern & Lane, the illustrative west-end Toronto planning studio, is quoting a holiday party for an engineering firm with 120 employees, open to all staff, with partners invited. The firm’s finance team wants the party to stay within the CRA’s non-taxable limit of $150 or less per person, including taxes, where persons include spouses or partners.

• Expected attendance: 120 staff plus 60 partners, so 180 persons.
• Maximum all-in cost: 180 times $150, or $27,000 including HST.
• Before HST at 13 percent: $27,000 divided by 1.13 is about $23,894.
• Lantern & Lane builds its proposal to a pre-tax total of $23,500: venue and catering $17,800, entertainment $2,400, décor $1,500, and its planning fee of $1,800.
• Taxis home are excluded from the limit under the CRA rule, so Marco offers ride vouchers as a separate line the firm can approve without breaking the cap.

The proposal opens with one sentence the finance team cares about: “Designed to stay within the CRA’s $150 per person limit for non-taxable staff events, including HST.” It won against two cheaper quotes that had ignored the rule.

In Canada and the GTA

The CRA rule on staff social events. The CRA’s administrative policy says an in-person social event is not a taxable benefit to employees when it is available to all employees at the employer’s place of business, which can be a branch or division, and costs $150 or less per person, including taxes. Spouses and common-law partners count as persons. Ancillary costs such as transportation home, taxi fare and overnight accommodation are not included in the limit for a non-taxable event. If the cost exceeds the limit, the full amount is taxable, not just the excess, and the ancillary costs and the partner’s attendance are then included too. There is also a maximum of six employer-paid social events a year. Finance teams care about this because taxable benefits add payroll work and an unwelcome tax bill for every employee. Read the CRA’s page on social events and hospitality functions, and leave the tax advice to the client’s accountant. Your job is to know the rule exists and design a quote that fits it. This is general information, not tax advice.

Fiscal years. Many private companies run on the calendar year, but many do not. The federal government’s fiscal year runs from April 1 to March 31, and so does the Province of Ontario’s. Many organizations that depend on provincial funding plan around that year, though not all of them use it themselves, so ask rather than assume. When an organization’s year ends in March, unspent budget in January and February can turn into spring events, training days and appreciation lunches booked at short notice. Ask every corporate client when their fiscal year ends, record it, and time your outreach for the two months before it.

Invoices and HST. Corporate finance teams reject invoices that are missing information. Ontario’s HST rate is 13%. For sales of $500 or more, the CRA expects the invoice to show your GST/HST registration number, the buyer’s name, a brief description of the services and the payment terms, and in Ontario it should show the total HST rate rather than federal and provincial parts. Quote corporate work before tax with the HST line clear. Remember that a per-person cap like the CRA’s social event limit includes tax, so always do the arithmetic both ways.

Public-sector buyers. Hospitals, school boards, colleges, universities and other designated broader public sector organizations in Ontario follow the Province’s Broader Public Sector Procurement Directive, which requires competitive processes for purchases above set dollar thresholds. They cannot simply book the vendor they liked last year. The track’s lesson on RFPs covers how to compete for that work.

The GTA corporate calendar

Toronto’s corporate market is concentrated downtown, along the Highway 401 and 404 corridors, around Pearson airport and in the Mississauga and Markham office parks, with head offices in financial services, insurance, technology, pharmaceuticals, engineering and professional services. Companies with national offices may run the same event in several cities, and those headquartered in Quebec may expect French-language materials or bilingual delivery, so ask.

The year has a rhythm. September and October are budget season for many firms and the time to propose next year’s events. Holiday parties for December are usually settled between August and October. January and February bring kick-offs and award nights. Spring is conference and gala season, and summer brings team days, client golf tournaments and patio events. Corporate decisions also slow sharply in the last two weeks of December and in August, when decision makers are on holiday. Plan your outreach around those gaps, not into them. Coordinators and executive assistants change employers, and when they do they often bring their favourite vendors with them, so keep in touch with past champions after they move.

Worksheet

Download the worksheet and complete it for your own business, using Lantern & Lane as the model where it helps. Keep it with your marketing plan. It takes about 10 minutes.

Download the worksheet (PDF)