UFI Global Barometer: Sales Down All Over

Almost two-thirds of show organizers around the world said they saw declines in space sales during the six-month period ending March 31. Nearly four out of five of them also said they anticipated revenue declines in the first half of this year, compared with the first half of last year.

Those were the results of the second Global Economic Crisis Barometer prepared by UFI, The Global Assn. of the Exhibition Industry, with input from its members, as well as those of the Society of Independent Show Organizers in the United States and Asociacion Intl. de Ferias de America in Central and South America.

UFI devised the quarterly barometer report late last year to gauge the progressive impact of the current global economic recession. The questions asked of recipients in the second survey were not identical to those in the first. Nevertheless, some of the findings in the recent report corresponded with nearly similar findings in the earlier report.

For instance, 68 percent of the 176 show organizers in the most recent report said they experienced declines in space sales for business-to-business shows held in the last six months. In the earlier survey, 63 percent of show organizers responded to a more general question by saying their businesses had declined in the previous year.

To the recent question involving declining space sales, 70 percent of those in the Americas said sales had fallen, while a larger percentage in Asia, 83 percent, said the same thing.

Show organizers in the Middle East and Africa seemed to register the smallest impact on space sales because of the economic recession. Fifty percent in that region said they had seen declines.

Responses to the question of declining revenue in the first six months of this year, compared with last year, were more consistent across the globe.

While 79 percent of all respondents said they had experienced revenue declines, the percentage went up only as high as 84 percent for those in the Americas and as low as 70 percent in the Middle East and Africa.

However, a higher percentage of show managers in the Americas complained about steep reductions. Nineteen percent said they had experienced revenue declines of more than 25 percent, compared with 7 percent saying the same thing in Europe and Asia.

When contacted by Tradeshow Week, some show managers said the overall results of the survey were consistent with their experience in the first quarter, but they believed that performance already had begun to improve in the second quarter.

“We are living in interesting times,” said UBM Asia Senior Vice President Michael Duck. “With fairs that have recently taken place in India, Hong Kong, China, Singapore and Thailand, there has been quite a good response, especially from buyers who come away from shows saying, 'Well, it was better than I expected.'”

Janos Barabas, CEO of Hungexpo Budapest Fair Center, agreed with Duck's assessment, adding, “I am awaiting the next barometer with moderate optimism.”

Across the globe, show organizers said the hardest-hit sectors have been shows in real estate and construction and public works. Of all respondents, 62 percent ranked real estate shows as the most affected by the economic crisis and 51 percent said construction, public works, urban development and architecture shows were the second-most affected.

There seemed to be evidence of that in the U.S. when the Las Vegas-based ReCon, The Global Real Estate Convention, held May 17-20, saw estimated attendance drop 42 percent to about 29,000 and the showfloor contract 23 percent to around 840,000 net square feet.

“(Our show) is in the three worst segments of the economy right now: retail, real estate and banking,” Phyllis Peterson, Intl. Council of Shopping Center director of leasing and deal making, told TSW during the show. “We have a perfect storm happening.”

About half the world's organizers (48 percent) said they had begun giving customers discounts to help them deal with the economic downturn, with those in the Americas being the most generous (56 percent) and those in the Middle East and Africa the least (15 percent).

Cost cutting was almost, but not quite, universally understood to be the way to improve the bottom line under difficult circumstances. According to the study, 85 percent of organizers had implemented cost reductions, with 40 percent saying they had made cuts of more than 10 percent.

A third installment of UFI's Global Economic Crisis Barometer survey will be conducted next month.