Spice Money
Spice money
We get a lot of questions about how Spice runs from a business point of view. Here is a little information on how your money is spent.
Is Spice a business?
Spice is a commercial business. We seek to operate at a profit, which pays staff salaries.
The main difference from the general commercial world is that those running Spice groups have made what accountants describe as a 'lifestyle choice.' (In plain English this means that Coordinators and staff have chosen to leave better paid jobs and careers to do something they love and believe in).
One other difference is the valuable contribution made to the group by keen volunteers in event coordination, which helps us to keep the costs down.
What are the major costs?
We contribute to the national running of Spice UK, which covers the salaries of the staff who organise your Spice holidays, plus national initiatives, advertising and events.
Fixed costs include banking, office rental, telephone bills, heating, electricity, office supplies, legal fees, web maintenance, motoring and IT costs.
A huge cost is the producing, printing, packing and posting of newsletters to over 100 enquirers each month. There is also the cost of producing and sending the newsletters to over 1,000 members bi-monthly.
On top of this is the cost of recruiting members - room hire for Preview Nights, advertising stands in leisure centres and at fairs, country shows etc.
Another hidden cost is VAT. Most of our activity suppliers are not VAT registered yet we have to be. We have to allow a full 15% in most of our costs which we can't claim back.
Where does income come from?
Membership Fees: the fees we receive for membership cover a proportion of our costs. We set these to cover the cost of producing and sending the newsletters and the costs of recruiting members. Also, a sizeable portion is returned to Spice UK to pay for the national structure of Spice and the administration of national initiatives and events.
Event Income: in our negotiations with suppliers we try to achieve a price to members which is competitive yet also covers such costs as the administration of the event, the VAT element and the cost of a place for a coordinator where applicable. There is also an element of 'swings and roundabouts' in that events, which are financially successful, allow us to allow some events to go ahead at a loss (rather than having to cancel them and disappoint members) or for us to speculate on investment in new ideas.
What is an 'admin fee?'
When we organise events we take into account the overall cost of running the business across all the events, offset against any group discounts and price the events accordingly.
Why do ticket prices sometimes differ from the newsletter?
We tend to book theatre trips on a Friday or a Saturday night, when group discounts are not available. We also tend to book the most popular acts, which are also not discounted. Most theatre tickets do not include VAT, which we have to add onto the price of the event. Theatres also add a handling and service charge, which is why our prices appear higher than the public price. Our members are happy to pay this extra charge as it means they will see a show with a group of friends, rather than going alone, or missing out.
When group discounts do apply, we don't know whether we shall achieve numbers for a discount or what level of discount we shall receive. Therefore we have to make a judgement. Either we cost tickets at the normal public price so we don't risk losing money if sales are poor, or if we feel we are confident of numbers we pass a proportion of likely discount to members. This is why ticket prices so frequently differ - but over a number of visits you will find that sometimes we win, sometimes we lose sometimes we just break-even!
