A picnic is a meal that you eat outside. For your birthday, you might take a picnic lunch (including celebratory cupcakes) to a nearby beach with some friends.
You can use the word picnic for both the occasion — "Let's go on a picnic!" — and for the meal itself: "I am packing the best picnic to take on our hike." It's also a verb, meaning "to eat outside." And when a friend describes a difficult task and adds, "It was no picnic," they mean to emphasize how hard it was — the opposite of an easy, breezy picnic.