Trade Fairs do not Exist without Trade Fair Construction!

19.03.2020 | IFES Press Releases | 1 comment

COVID-19 puts nearly 250,000 jobs in the exhibition stand construction at risk throughout Europe. According to a recent survey from the International Federation of Exhibition and Event Services (IFES), nearly 300 members are projected to lose approximately 50% of their annual revenue.

These figures prove that COVID-19 has developed into a crisis that the exhibition stand construction industry in Europe can no longer cope with on their own. These exhibition stand companies will be vital to the eventual economic recovery but will not exist if they have to deal with a mountain of debt and interest rates devouring any chance of financial stability.

An estimated 1750 European stand construction companies are seeing the most important international trade fairs cancelled due to country shutdowns. While there is no doubt that the current Corona Pandemic makes this necessary, there is also no doubt that the exhibition stand construction sector is being hit particularly hard. Exhibition stand construction companies and their service providers, are going through the same shutdown as the countries in which they are based.

Behind closed doors, many organisers are now confirming that they no longer expect any events before the summer break in 2020. Most trade fairs take place at the beginning of the year and then there is a summer break from the end of June to the beginning of September. The remaining 40% of events take place in autumn between September and December. Exhibition stand construction companies are now hoping to survive until the autumn trade fair season.

These companies, whose livelihoods were shattered at the end of February by the sudden cancellation of all events, must now bridge a six-month loss of sales. At best, these companies will receive just a few euros for the direct costs incurred by their customers, but that’s it.

This is aggravating. When you talk about SMEs, these companies are among the small ones with an average annual turnover of EUR 5.3 million and about 42 permanent employees, these companies shoulder a heavy burden. Additionally, they generally fall through the ranks when it comes to system relevance. ”This is a gross misjudgement,” says Torsten Heinze, Vice Chair of IFES and Managing Director of the German-American trade fair construction company Czarnowski, ”The industry as a whole represents annual sales of EUR 9.3bn within Europe. And with all suppliers, such as assembly companies, freelancers, technical service providers, this EUR 9.3 bn represents almost 250,000 jobs.

The effect that COVID-19 had on companies as of 15 March is dramatic. Around 46% of annual turnover has been lost, usually within a few days. Half the annual turnover is an order of magnitude that even the best-placed company cannot shoulder.

In some European countries, measures such as short-time work compensation and state bank guarantees for loans have created opportunities to bridge liquidity bottlenecks. Nevertheless, the mountain of debt of these companies is growing every day, so that the first companies are now considering the possibility of planned insolvency.

This must be prevented with national and/or European funds, because when the economy picks up again, when trade returns to normal, these many service providers will be systemically relevant to create adequate presentations for the many exhibitors on and off the exhibition grounds. Trade fairs and conferences will then become a catalyst for economic recovery and are an important element in preventing the Corona crisis from turning into a long-term recession. “Trade fairs without trade fair construction, that doesn’t exist”, explains IFES Managing Director, Uta Goretzky.

Already on 2 March, 2020 IFES sent a petition on behalf of its members to the President of the European Commission, Madame Ursula von der Leyen, with the request for a European aid fund for all companies in the sector based in Europe to bridge the time until the situation returns to normal.

As an international umbrella organisation, we at IFES therefore demand national and European fund solutions that refrain from a repayment of the financial contributions granted. In order to counter the argument of abuse at this point, we as an international association, but also the many national associations with their industry-specific expertise, are happy to support public authorities.

Further information can be found on the website as well as on LinkedIn, Twitter and Facebook under #IFES

1 Comment

  1. Larry Kulchawik

    Well stated. You are so correct that covid has put our industry out of business. No one to blame here but the economic impact (particularly to fair service companies who are small) in cities around the world is devastating. Our local government can surely help to provide some forms of aid to keep these companies alive when trade shows return at full strength.
    Through this past year exhibiting companies have been examining their marketing budgets and have explored alternative ways to attract new business using virtual and digital methods. These digital alternative have allowed companies to continue marketing since face to face has been shut down. In my opinion, face to face is now returning but will weave in some of the digital solutions they have experimented with this past year. Digital alternative should be considered but they do not effectively compare to face to face events where the element of emotion plays a powerful role to generate new sales opportunities. Yes, there would be no trade shows without trade show suppliers, but there would also be no trade show suppliers if there were no events.
    I trust that the return of trade show events will reassure all exhibiting investors that face to face marketing has greater power than digital alternatives. We as exhibit suppliers will evolve with the changing times and will not only create new ways to think about design, but will design with a new way of thinking.

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