Setting stand pricing
06-Feb-12by Annie Byrne
Setting out into the marketplace to attract clients to a new show can be an intimidating task. In the current economic climate, it may be difficult to find right the level of pricing – or so you might think.
The resounding message from industry commentators approached by EN is don’t discount to secure revenue. Discounting has a two-fold effect of giving you a less sound base to make a profit and could also spread fear among exhibitors that the show may not succeed.
“For a new show, perception is everything,” said Niche Events chief executive Peter Jones. If a show is cheap only because it is being held for the first time, it will make exhibitors nervous.
“Do not offer a discount on the space. The moment you do an individual deal and word spreads, people will start asking why. The only way to bring the rate down is to offer them smaller exhibition space,” he continued. Brian Wiseman of Wise Guys Consultancy agreed.
“Getting prices as high as you can without frightening clients away is key,” he claimed. “Don’t go in too low otherwise you can’t reduce prices in the long term.” Where to pitch
So how do you go about setting stand prices for your show? Wiseman suggested a subtle fact-finding mission.
“I’d look at the marketplace. I’d pick out five or 10 exhibitors and research what shows they’re doing,” he advised. Brintex event director Bill Butler also urged organisers to listen to what exhibitors are telling them and find out what the market is prepared to pay.
Niche's Peter Jones takes it one step further by actively telling his clients that his firm has researched the market and arrived at an average stand price.
“We make it very simple. We compare prices in the market and put ourselves somewhere in the middle,” he said. “That’s why we can always tell exhibitors that ‘if you compare our prices to X or Y, we are a good rate’, which gives them a clear indication.”
All our industry commentators claimed stand prices had risen in recent years despite the economic conditions.
“Stand prices have moved with the rate of inflation. There has been nothing drastic,” said Charles Ross, deputy managing director at Single Market Events. Butler agreed prices have generally risen with inflation but urges caution in setting a tariff.
“Some of the shows in the local government sector for example have been affected by the economic downturn, which means that there is less money available,” he said. Payment plans
After agreeing a price, there comes the delicate negotiation of setting payment plans.An exhibition organiser needs to have payment from exhibitors at least a month before paying their own costs for a show. Here flexibility is crucial and organisers are becoming more amenable to structuring payment costs.
“Depending on the show, we offer a variety of rates,” Butler said. “For example if there is an event in 2013, we would ask for a 10 per cent deposit now, 40 per cent next summer and the rest in the year of the show. This allows them to split the invoicing.”
A final consideration is the location of a show. “The location will make a difference because of the rates they are paying on the venue,” Wiseman said.
The resounding message from the industry is for organisers to have the courage of their convictions. Set a price and don’t be swayed to offer a discount. After all, anxiety could be counter-productive.
Do not discount your stand prices. This will put you on weaker footing commercially and could spread panic around exhibitors that the show is uncertain of success.
Research your exhibition market. Look at prices charged at similar shows both nationally and internationally.
Sound out your exhibitors and look at what they expect from a show. Canvas good and bad experiences in the market.
Be as flexible as you can with your payments, but bear in mind you need the money from the exhibitors a month before you need to pay your own costs.
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