Chicago, IL – Show organizers wanted changes in Chicago, and changes they will see. The Metropolitan Pier and Exposition Authority (MPEA) met Monday with state legislators to discuss what can be done to maintain convention business. One item on the agenda was a labor exclusive. But will such a change actually reduce costs? “Price and cost are two different things. If an exclusive could help influence the cost, I would be for it, but it tends not to turn out that way,” said Gene Sanders, senior vice president of trade shows at SPI: The Plastics Industry Trade Association (SPI).
SPI’s triennial NPE was the second show to depart Chicago, citing economics. “The cost of doing business was a big part of the reason we moved,” said Sanders. The show drew 44,000 attendees to 997,660 net square feet of exhibits in 2009. According to the SPI, the show’s move to the Orange County Convention Center in Orlando in 2012 and 2015 will lower NPE exhibitor costs an average of 48% for utilities; 19% for drayage and rigging; 23% for lodging; and 11% for travel. Lower labor costs will drive most of the savings.
Sanders said an exclusive has the potential to save money by lowering both the price and cost. Convention centers, however, may look to the exclusive contracts as a revenue source, which can impact price, he said. Sanders suggested decentralized management might help to counteract that conflict of interest.
Ultimately, however, show managers are wary of exclusives because the lack of competition no longer helps to keep a lid on rates. “Competition creates better pricing,” said Sanders.
Reach Gene Sanders, senior vice president, trade shows, SPI, at (202) 974-5200 or firstname.lastname@example.org