Association Central: Business in the Lone Star State

By Heidi Genoist -- Tradeshow Week, 10/25/2004

Everything's bigger in Texas, or so Texans would have you believe. Well, as it turns out, tradeshows may not be bigger in Texas — but the tradeshow business certainly is.

There are 3,840 trade and combination trade-consumer events scheduled to take place in 2005, according to Tradeshow Week research. Of those, 368, or 9.5 percent, will take place in Texas.

Only Dallas, which will be home to 240 of Texas' 368 shows, made the top 10 cities in terms of TSW 200 shows hosted. But at No. 7, Dallas follows Anaheim, which has fewer total net square feet of exhibit space. As for market share in terms of square footage of TSW 200 shows, Dallas doesn't even make the top 10.

Other areas of the United States may be home to greater concentrations of companies in certain segments of the exhibition industry — show managers in Massachusetts, for instance, or exhibit designers in Chicago. But Texas is home to some of the biggest names from across the business: Freeman, Hanley Wood Exhibitions and the Intl. Assn. for Exhibition Management — all tops in their fields — are headquartered in Dallas.

And businesses of all sizes thrive in the state. According to TSW research, throughout Texas, there are eight general contractors operating in 14 locations, 14 exhibit transportation companies in 30 locations, 10 I&D firms in 16 locations and 16 exhibit designer/producers in 19 locations — and that's not counting the plethora of audiovisual providers, computer rental companies, florists, electricians, modular/portable dealers and other suppliers.

So what draws them there, if not the shows?

"I think when you talk to people in this business — or just about any business — they inevitably give an answer about location," said R.V. Baugus, editor of Facility Manager magazine for the Intl. Assn. of Assembly Managers.

"That certainly played a part here," he added, of IAAM's move from White Plains, N.Y., to Dallas in 1989. "Being able to work with our members on either coast and be available to them either an hour ahead or an hour behind is a legitimate issue for any association."

Many associations appear to share this view. Of the 3,840 shows TSW research indicates will take place in 2005, 129 will be managed by Texas-based organizations; 81 of these organizations (slightly more than 62 percent) are associations.

This is part of the reason why, when John Swinburn left his position six years ago as senior vice president and COO of IAEM to start his own company, the 20-year veteran of association management stayed in Dallas.

"I knew a lot of people, and I knew I could make a lot of connections work for me here," said Swinburn, who had also worked in Chicago and White Plains, N.Y., before relocating to Dallas with IAAM, where he was employed at the time. "It's a large, centrally located city with a good business infrastructure and a good climate."

In fact, weather is a draw for many people who want to stay in a central location, but prefer to avoid the colder climates of the north.

Ray Pekowski, president and CEO of The Expo Group, moved to Houston in 1978 to open an office for GES Exposition Services. When the Chicago native went out on his own, he, like Swinburn, decided to stay in Texas. The Expo Group is now located in Dallas.

"It didn't have anything to do with the market here," Pekowski explained. "It's the second largest state and Houston has the fourth largest population in the U.S. You have good labor conditions here... and good weather."

The central location and good weather are important to Pekowski for different reasons than those the associations have. The Expo Group's business model is to maintain one large home base and send people out to serve customers, wherever they are — rather than having offices set up all around the country and serving customers with local teams.

"To offer more consistent service, we go where the customers are," Pekowski said. Good weather and a central location make it easier for The Expo Group's teams to get in and out of the many locations they travel to.

It's this difference in business models, he added, that has allowed the company to thrive in the home state of one of the country's two largest general contracting firms, The Freeman Companies. "If I were trying to compete on the same business model with Don (Freeman, Freeman founder and CEO), that would be disastrous. He is entrenched and they do a good job. But our model is so different," Pekowski said.