It’s not just big businesses that reap the rewards from corporate entertaining: smaller businesses can also enjoy the networking action during this year’s spring racing carnival. Sponsorship Today Research shows $735 million is spent on sports sponsorship in Australia each year. This enormous figure shows just how much value businesses place on the corporate entertainment that comes with sponsorship packages. Indeed, being associated with a sport delivers substantial benefits for businesses. It allows sponsors to increase awareness of their brand, build stronger relationships with the clients they’re entertaining and reward top staff.
There are lots of possibilities for businesses to take advantage of sponsorship opportunities but the Spring Racing Carnival has to be one of the most exciting and glamorous choices. So what are the options for smaller enterprises to align their outfits to the sport of kings.
What clients want
If you’re looking for corporate sponsorship or entertainment opportunities there’s a plethora of sports to choose from, but few beat the glamour and style of the races.
In fact, research undertaken by the Australian Turf Club has shown racing beats all three football codes as a preferred leisure activity, making it a smart choice when it comes to entertaining clients. There are lots of options to suit budgets both large and small.
At the top end, an exclusive event for 70 held at The Gallery at Flemington on Melbourne Cup Day will set you back an estimated $77,000. The package includes morning tea, lunch and afternoon tea for guests, as well as lots of extras.
Don’t break the bank
Too pricey? Sponsorship and entertainment comes in all shapes and sizes. Think about investing in tickets for your favourite clients – or perhaps would-be clients if you’re trying to win new ones - in The Precinct area at Flemington during Cup Carnival. Tickets are RRP $195 a person, which covers admission.
Food and beverages are not included in the ticket price. Or consider a beautifully catered car site available to members at three Flemington sites.
If membership eludes or the budget is tighter still, consider hosting a champagne breakfast, or special lunch at a hotel, restaurant or pub known to put on a bit of a show. The Langham Melbourne and Park Hyatt Melbourne offer packages raging from RRP $49 to RRP $125 per person, while Terra Rossa in the heart of Melbourne CBD puts on an upgradable, themed breakfast from RRP $25 per head.
A crowd pleaser
According to Victoria Racing Club acting CEO Julian Sullivan, one of the advantages racing has over other sports is that a day at the races is about much more than horses and betting: the best food, wine and fashion all share centre stage. Says Sullivan: “It really is the invitation everyone wants to receive. You know you’re going to get a very positive response from your clients. The event appeals to both men and women, so you can be sure your clients and their partners will enjoy the day. It’s an incredibly social event, so you can engage with your clients or staff all day and create lasting memories together.”
To ensure your clients have the best possible experience at the races, Sullivan says it’s important to plan ahead and think about how you will get to the track. “Encourage your guests to choose the right outfit; make sure it’s race- and weather-appropriate.” But above all, remember the day is about fun as well as business. So take the opportunity to create shared memories with clients, enjoy the experience and take time out to relax and cement those client relationships.
FBT applies when you’re providing benefits to staff and clients unless the benefit is infrequent or minor; that is, less than $300 per individual.
More than Melbourne
The Australian Turf Club, which manages racing in New South Wales, also offers a variety of hospitality packages at its racetracks. Aside from corporate hospitality, it’s also worth thinking about sponsorship options such as big screen advertising, on-course promotions or even race book advertising. Also remember that races are run at many tracks around the country, not just Randwick and Flemington. So consider more cost-effective sponsorship or entertainment options at tracks such as Rosehill Gardens or Warwick Farm in Sydney, or Sandown and Bendigo in Victoria.
Cheers to the taxman
One of the benefits of corporate hospitality is that your investment is also tax deductible. However, fringe benefits tax (FBT) is payable on certain expenses, as David Staples, director of accounting firm Pitcher Partners, explains. Staples says everything from corporate boxes to marquees and even food and alcohol can be claimed as tax deductions, as well as other expenses such as banners and signage.
Fringe benefits tax to-do list
Taxation specialist David Staples emphasises it’s essential to keep records of all client entertainment expenses. This is especially important if a business decides not to claim entertainment expenses as a tax deduction. If the business has not kept records, the ATO may decide FBT should still be charged on the entire balance of entertainment expenses where the business is unable to accurately classify entertainment as either staff or client related. To avoid any confusion about which costs associated with entertaining or sponsorship attract FBT and which don’t, Staples says it’s imperative that sponsorship or entertainment contracts itemise individual costs such as banners, beverages and food, so it’s clear which items are deductible and which attract FBT.
Prices correct at time of publishing.