Small business owners are always trying to cut back on spending. Some tasks, like business entertaining, are too important to cut completely.
Entertaining is an integral part of any discount. Highlight the fact that you are bringing business contacts to these meals that are likely to need venues for their own entertaining needs.
Do your research. There is nothing more costly than spending vast amounts on an activity your client might not even enjoy. Find out what their favorite restaurant is, if they follow a particular sports team, if they prefer a certain type of art, and then schedule activities around their interests. Not only will you get more bang for your buck, you will show your contacts you really understand them.
Limit the number of people. Not only is it cost effective to entertain fewer people, but chances are you will establish a stronger connection with your contact if you are socializing in a small group. Have two people from your company meet up with two of your key contacts; you will be able to get a lot more done than including the whole team. Remember, it should not always be the most senior person entertaining. Sometimes it is helpful for staff to get to know the people they work with on an everyday basis.
Think outside the box. Fancy restaurants and drinks are not the only way to entertain. Consider low-cost or free activities like trips to museums, tours around your city, dinner in someone's home, hikes, etc. If you're in New York City, tickets to Late Night with Jimmy Fallon are an example of a fun outing that is FREE. With that being said, some business circumstances do demand formality (negotiating a contract, asking for investment money, etc). For every other scenario, get creative!
Piggyback on existing events. Is there a big conference or networking event all your clients are planning to attend? If so, host a before or after party. It is a lot cheaper to entertain contacts for an hour than an entire day or evening and you will have the benefit of capturing their attention within a wider-industry event.