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We get a lot of questions about how Spice runs from a business point of view. So as the office is too small to organise a 'behind the scenes' here, |
Is Spice a business?Yes Spice is a commercial business, rather than being in the charity/voluntary sector! We seek to operate at a profit, which then pays my salary - and my rent!! The main difference, however from the general commercial world is that those running Spice Groups have made what accountants describe as a 'lifestyle choice' (which in plain English means that Coordinators and Staff alike have generally 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 - so please don't resist any volunteering impulses you might have! What are the major costs?Obviously salary cost comes high on the list, plus fixed costs including office rental, the huge telephone and fax bills, heating, light, electricity, office supplies, postage, web maintenance, train, motoring and IT costs. These along with all the general costs of running a business such as professional fees and insurances (try telling your Insurance Company that you run fire eating) are not unusual. However, there are some areas of cost, which surprise members, as they are unique to the way we Spice Coordinators choose to run our groups. One of the contributions we make is to the national running of the Spice network or groups. Another is the cost of producing, printing, packing and posting the newsletters and holiday supplements. The other big hidden cost is VAT. This is a major cost since most of our activity suppliers are not VAT registered yet we have to be. This means that we have to allow a full 17.5% in most of our costs without being able to claim any back. Also because of the huge number of transactions between so many members and events by cheques and debit and credit cards Spice banking charges are colossal - we've projected a sum of nearly £2000 in credit card fee payments by us over the next year, which is more than double what we collect in 50p surcharges) |
Where does income come from?Membership Fees: as a membership organisation, 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 (info packs, new member packs, advertising etc). 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 such as buying the Zorb. 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?Theatre tickets always have printed on the front the final ticket price paid by Spice after any group discount has been deducted. It also does not include any booking fees - which can be weighty! Often group discounts apply, but the problem is we don't know whether we shall achieve numbers for a discount or what level of the 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!! |
