Understanding Venue Rental and F&B Minimums

Insight | Alexa MGMT

What is it that you are looking for as you shop for the right venue for your next event? Our guess is that there is a list of needs (& wants), a certain gut feeling, a price point, or, most likely, some combination of all these to varying degrees of importance. You need the right space for your guests, as no one knows the attendees better than you. You need the right space for whatever it is that you are hosting, as you do not want an intimate elopement taking place in a cavernous, indoor ballroom. And you need the right space for your budget because you don’t want to be venue-poor once you start planning.

Every venue is as unique as the event you are looking to bring to it, so here is a quick overview of venue rentals and F&B Minimums.

Venue Rental

Definition: the leasing of a specified location

This is usually a flat amount based on the value the owner or manager of the venue has put into place based on any number of factors such as seasonality, included amenities, and square footage. What this includes varies upon the venue but does not include any food or beverage. Not all venues require a venue rental but it is definitely the majority.

F&B Minimum

Definition: the contracted or agreed-upon amount of revenue that the customer must spend on food and beverages to utilize the venue

This can either be calculated on a per person basis or on the size of venue and how many guests could utilize the space at one time. It is extremely important to remember that this is a minimum and that in a vast majority of all events this number is exceeded in spend, and that excess can be in the thousands. If the F&B Minimum is a threshold for you then you will need to work with your planner more than most on the front end so you can understand what you will be able to offer for the minimum. The venue rental does not count toward the F&B Minimum.

Example | An Intimate Wedding with 20 Guests

For our visual learners, here is a hypothetical.

Venue Rental

$2,500 (venue rental) + $2,500 (F&B Minimum) + $412.50 (based on Texas’ 8.25% tax) + $1,200 (based on estimated 24% service charge/gratuity) = $6,612.50

F&B Minimum Only (No Venue Rental)

$2,500 (F&B Minimum) + $206.25 (based on Texas’ 8.25% tax) + $600 (based on estimated 24% service charge/gratuity) = $3,306.25 (Actual spend required to book the space, though tax & service charge will be added to the final menu selection.)
Final menu selection at $150 per person x 20 people = $3,000
$3,000 (total after final menu selection) + $247.50 (8.25% tax) + $720 (24% service charge/gratuity) = $3,967.50 (actual spend for the event)