Outsourcing your show.

Thinking of tapping outside talent to sharpen up your trade showy? For best results, define your objectives before signing a contract.

Sometimes you can't do it on your own. No matter how professional and experienced you are. No matter how big your meetings staff. No matter how mature your association. At times it may make sense to at least consider the alternative of outsourcing some or all of your meetings management.

Take, for instance, the effect of the growing globalism of trade relationships on association programs and issues. It certainly shows up in meetings. Participants come from all over the world; educational content must include at least a few programs addressing the effects of doing business internationally. And on the exhibit floor, how many of your exhibitors now must have cleared customs just to get to your meeting?

It's a little tough keeping track of all those exchange rates, time zones, country codes and import-export laws, isn't it? Then throw in the prospect of joint venturing your show with another association - or several. You just might be smart to look at how a reputable outside show management company can keep things organized for you.

Expanding demands

Just ask Bonnie Jessup, director of conferences and meetings for the Washington, D.C.-based Intelligent Transportation Society of America. She produces an ITS annual meeting in the spring and then a world congress in the fall.

The world congress is jointly run by three different organizations from three different parts of the world: the United States, Asia, and Europe. There is lots to keep track of, but very little that will stay unchanged for very long. And the concepts of cooperation, coordination, and schedules are subject to broad interpretation, driven by many different cultures. So Jessup works with an outside meetings management company, Alexandria, Virginia-based National Trade Productions, to handle the daily grit, grind, and detail.

"Why not handle our portion ourselves?" asks Jessup rhetorically. "Because we're me. Like almost every other association staff, we're small and overburdened. And it just makes sense to bring in outside help as the demands for it expand."

Last year ITS hosted its world congress in Orlando, Florida. This year it will be Europe's turn in Berlin. But while the workload may be nearly as concentrated as it was last year, the ever-pressing objective of growth (from 71 booths in the meeting's first year three years ago to 424 booths in Florida last year) leaves no room for letting up, no matter which organization is the world congress host.

Trade shows are an increasingly competitive environment, says Tamara Christian, National Trade Productions' director of marketing. You're either competing against yourself against last year's profits - or against other shows that would be very happy to clip into your exhibitors' show budgets. And frequently, she says, it makes sense to turn to the outside management companies that focus on nothing but trade shows.

"We can focus our energies on what we're expert in: show management," says Christian. "That way the client can focus on its expertise: serving the members and developing the education side of the program."

Counterarguments and considerations

Outsourcing your trade show can be beneficial, to be sure, but association executives and management company executives alike agree that the association executive must be mindful of numerous considerations before contracting out.

Dobby Wall, director of meeting services for the Alexandria, Virginia-based American Physical Therapy Association, which manages all its meetings in-house, offers this argument against outsourcing meetings: "It's interesting to me that anyone would want to give up control of his or her trade show. Everything is built on relationships. If you're not the one establishing the relationships with the exhibitors, you're not the one who will be able to build on that foundation in the long run.

"You need to have just as much content expertise in the exhibit hall as you do in the education side," she says. "The person who manages the exhibit side needs to know the trends in the industry and our profession ... not to mention which companies are being bought up by others, what mergers and acquisitions have taken place over the past couple of years - those kinds of details that the association insider is most likely to know."

Absolutely, agree management company executives. That's why they prefer contracts that extend well beyond one or two shows. But first, they advise, it's important for the association to know why it wants to go outside for management help and specifically what kinds of services the group needs and expects.

There are many reasons why an association would explore outside management alternatives, says Mike Muldoon, president of Fairfax, Virginia-based Convention Management Group, but a likely time in the association's history is when it realizes the trade show revenue potential is growing faster than the limited staff can cope with. It may not be quite cost-effective to ramp up fulltime staff to absorb the growing demands of the show. But it may be a false economy to try to manage a world-class show with only one or two employees who are doing the show on a part-time basis.

"Another prime time to take the show to an outside firm," he says, "is when the association wants to launch a show or strategically reposition [a show] in the marketplace."

The expertise bank

Says Christian, of National Trade Productions, repositioning your show can have real financial rewards, and the fresh ideas from full-time show management staff may help boost the association's profitability. "Trade shows have become strong revenue producers, and associations looking at how to improve their revenue stream are naturally looking at the potential of their own shows," she says. "If you can bring in an expert who can focus on cutting costs and boosting revenue, you are improving your show's potential.

"And since we are full-time show managers, we make it our business to stay current on all the latest technologies and techniques," continues Christian. "While your office may do maybe two or three shows a year, we do between 20 and 30 shows a year, which dramatically increases our experience level. We know firsthand what works and what doesn't work. We know the pros and cons of different registration systems, we know what's going on at the major facilities, and we're up to date on all the new ideas and how well they've held up in real-life application."

And, says Ron Nunnery, senior vice president of the Arlington, Virginia-based American Meat Institute, outside management firms can provide the benefits of a full-scale, full-service internal meetings department without the overhead that might be prohibitive to a smaller association. Nunnery has seen AMI's biannual show grow from 350 exhibitors in 1989 to 525 in 1997, and he says the growth happened when the association took the show to Convention Management Group after having managed the event with a two-person meetings staff.

"Our exhibitors have now gotten used to a higher level of service and more horsepower of expertise than we could have provided on our own," he says. "We have had a consistent up-line pattern of growth, a good concept, and a terrific record of attracting attendees.

"To bring this operation in-house, we'd have to spend a lot more money and hire more people to produce the same results," he says. "We'd need more hands, more minds, more hardware, and more software that we just don't have."

The learning curve

Of course, as Wall would point out, the association that chooses to manage its show in-house gets to keep the profits rather than share them with a show management company. Associations and show management firms typically resist talking about the specifics of their terms, but agreements range from a fiat management fee to a joint sponsorship to an outright purchase of the association's show, with the association lending the show its name and imprimatur.

The typical agreement usually involves some kind of management fee, plus what Christian calls a "stretch goal" - an incentive to keep selling that booth space. "That's the way the company then rewards its salespeople," she points out.

Christian and Muldoon agree that the contract between the association and the outside firm should include at least three cycles, if not five. The first year, they say, is a steep learning curve. The management company must learn the client association's issues and political sensitivities, meet and gain the confidence of the leadership, and put all necessary systems in place to take the current database of exhibitors and delegates and increase it to new levels. By the third year the investments in time, learning, and relationships really pay off, they say. All this, of course, isn't to say that the association is stuck with an unsatisfactory deal.

"You do need to have an out in the contract if the company is not up to its end of the deal," says Christian. "We wouldn't want anyone stuck with us if he or she was not happy."

Dissatisfied clients, of course, aren't what outside management companies like to focus on, but Janet Wright, who chairs The Wright Organization, a Des Plaines, Illinois-based association management company, says that unethical behavior is a challenge in the industry.

"Most show managers are extremely conscientious about keeping expenses down, but some management companies expect commissions from a service contractor," says Wright. While no one is willing to give examples or to name names for the record, reputable convention management firms worry about the familiar practice of some not-so-reputable outside firms taking advantage of their buying power and pressuring vendors to pay them back a percentage of the value of the contract - all without the knowledge of the client association.

"I'm not willing to say it's an everyday practice, but it's certainly known in the industry," Wright says. "And it's more common than makes me happy."

Wall agrees that negotiating leverage that outside management firms sometimes quote as an advantage often translates into unfair pressures for the service contractors to pony up some of the profits. That practice, she says, ultimately reflects poorly on the client association, when word gets around the meeting services community that your association does business with bully meeting planning firms.

On the other hand, the association - or outside firm - that chooses the intangible benefits of relationship over the tangible benefits of budget will be glad in the long run. Long-term relationships can go far, even between the client association and the outside firm. Muldoon's first client in 1990 was the American Meat Institute, a happy strategic alliance that continues even though the company's goal is to add a new client every year. And Wright reports that she has represented some shows since 1978.

"There's enough turnover in association staffs that frequently we're the only continuity the association has," she says. "Those associations are very reluctant to move the show away from us and bring it in-house, because of our expertise with the exhibitors. Take us out of the picture, and the corporate memory is gone."

However, Wall warns that individuals within the typical outside firm typically find new positions after a year or so on the job. The environment burns them out so quickly, she says - with the firsthand experience of having been there and done it herself. But the good news is that those staffers are terrific in the association world.

"I would definitely hire people out of that environment," she says. "If they can survive a year there, their work ethic would have to be fabulous."

There are many reasons why you might want to contract with an outside firm to help you run your association's meetings: You may need help in meeting new international objectives; you may want to keep your in-house staff small; you may want to reposition the meeting in your market and the fresh perspective would help; you may want to take advantage of the deep expertise of a virtual staff (the outside firm's own employees) who do nothing but organize meetings - and many of them - all year round.

Whatever the reason, if you turn to outside help, know your objectives, and pick your meetings management firm carefully. As it represents you to vendors, members, and exhibitors, its reputation will quickly become your own.

RELATED ARTICLE: Virtual Booths Enhance Trade Show Presence

If you were a Web novice two maybe three years ago, today thanks to ever increasingly friendly browser software - you can probably scan and surf with the best of them. In fact, it's possible you've even found a few new exhibitors on the Web and lured them onto your trade show floor with a real booth.

Of course, the next step is to figure out how to marry the market potential that Web sites are offering with the face-time potential your exhibit space provides and then figure out how to use each to enhance the revenue potential of the other. With the Web, exhibitors can be available to prospects 24 hours a day, 365 days a year.

"An association show producer's responsibility is to expose the exhibitors to prospective customers, and today that mainly happens at a physical show for rent dollars for only a taw days," says Tom Mitchell, managing partner of Roanoke, Virginia-based VOLTS (the Virtual On-Line Trade Show Company). "With an online show, producers can offer their exhibitors a global exposure to buyers at a fraction of the cost for as long as exhibitors would like."

And as much as the virtual show can give to exhibitors, Mitchell says virtual and conventional shows are not inherently competitors. They each offer different benefits the other can't provide.

"The values inherent in the conventional trade show include the personal relationships you develop on the show floor, the chances you have to see, feel, and hear the products," he says. "These are experiences that cannot happen electronically. So the physical trade show will always be protected from being replaced by the electronic version."

At Alexandria, Virginia-based APPA: Association of Higher Education Facilities Officers, Diana Tringali, webmaster and director of research and development, is working with Chicago-based Virtual Exhibits International to launch a virtual trade show that will simulate an exhibit hall for a span of three months. The virtual booths are a data equivalent of square footage. "The more content you put on, the more expensive it becomes," she says.

Additionally, she says, the association will place on the physical trade show floor computer stations that will feature virtual presentations. Tringali specifies, however, that these computerized presentations are available to only those companies that do not have actual booths.

"This is an opportunity we're offering to companies that might not traditionally exhibit," she says. "These would be smaller companies, start-ups without the money to send people to the show, or companies whose services might not lend themselves to traditional displays."

Tringali also expects that she is not competing with herself for exhibitor marketing dollars - that Web site funding comes from a different budget pocket.

"Online dollars usually come from advertising and marketing," she says. "Trade show money comes from a different line on the budget."

Keeping in mind that some of her members are still new to the Internet, Tringali plans to continue offering an Internet demonstration and message center, providing several workstations for employees to practice their Internet skills. This is yet another chance for corporations to promote their services.

"Each station is sponsored by a corporation," Tringali explains. "And when the demonstration is complete, the computer defaults to a presentation developed by the sponsor."

Martha I. Finney is a freelance writer based in Annapolis, Maryland.