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The nation's largest office furniture group is studying the feasibility of starting its own trade show, a move that could have serious consequences of NEOCON and Chicago's Merchandise Mart.

The Business and Institutional Furniture Manufacturers Assn. (BIFMA) is surveying its members, which number more than 240 internationally, as well as members of the design community, regarding the possibility of abandoning permanent displays at the Merchandise Mart in favor of a travelling association-sponsored trade show.

Stephen Channer, executive director of BIFMA, speaking at a breakfast meeting June 14, which was attended by association members as well as Mart officials, said the association was investigating the feasibility of sponsoring a trade show that could "replace our current method of using permanent marts and design centers for product representation."

This could mean the pullout of the majority of companies on five floors dedicated primarily to contract furniture displays at Chicago's Merchandise Mart. BIFMA members occupy close to 1 million square feet of display space on those floors, Channer said.

Some BIFMA members at the Mart contacted by W&WP declined to comment on the plan.

The plan would call for the eventual establishment of an association-sponsored trade show that would travel to different cities each year. Some of the cities under consideration include: Chicago, Boston, Atlanta, Dallas, San Francisco, Las Vegas and New Orleans, said Channer.

Channer said the BIFMA board of directors, concerned about rental expense and, with the exception of a four-day trade show, the lack of daily floor traffic at the Mart, have been discussing the idea for several months.

"One of the problems is the economy has slowed down floor traffic (at the Mart)," said Channer. "Another problem is the rental expense that has to be paid "day-in and day-out' all year round. The question is, |Is that the best way to spend marketing dollars, or could that money be better spent on more salespeople or more advertising?"

Currently, the Mart sponsors the world's largest office furnishings show, NEOCON, which attracted an estimated 30,000 attendees this year. During these four days the floor traffic is at its greatest. After the show, floor traffic drops substantially.

Merchandise Mart officials declined to give specifics on what individual companies are paying for display space in the Mart but defended the rental rates.

"We feel we are charging the (rental) rates that are in line with the industry," said Jim Bidwell, senior vice president of corporate affairs at the Mart. "Chicago is a competitive market and we wouldn't have people here if our sales weren't competitive."

According to a survey conducted by Frain Camins & Swartchild, a leading Chicago corporate real estate service, the Mart has a quoted rental rate of $21.50 a square foot. At this rate, multiplied by the amount of floor space rented by BIFMA members, it is possible the Mart could lose around $20 million in rental income annually.

Greg Witt, of FC&S said this rate is likely to be "the most they ever will get for that space." Rates might fluctuate through negotiations with individual companies or because of a variety of factors, such as location within the Mart and total space rented.

Bidwill, who has been instrumental in staging the trade show since its inception 23 years ago, said he is not concerned about the ongoing study and its affect on NEOCON. "We plan on hosting NEOCON for another 23 years," he said.

"The advantages of staying here are that the show is known for its time and place, the hotel rooms, the accessibility of Chicago to the rest of the country and the network of communications we have developed across the world," Bidwill said. "You would not do it as efficiently or productively if you do it city by city."

Enoch Anderson, executive vice president of contract furnishings at the Mart, said that a show held on either coast would lose attendance from the other coast. He added that "thousands" of people come to the Mart daily.

However, during NEOCOM 23, June 11-14, show attendance was down for the second year in a row. Definitive numbers are not available because the Mart does not keep track of those attending, but a random sampling of displaying companies said that the numbers were down.

Whether or not moving out of the Mart and launching an alternative trade show would save money for companies is debatable. John Berry, director of the Trade Show Division for Vance Publishing, said often the biggest expenditure of having a travelling show is the moving and setup of the display, and not the display area cost itself. "A 400-square-foot display might only cost, a company might spend $100,000."

The study being conducted by BIFMA is expected to be completed by October. Should the survey reveal support for a BIFMA-sponsored trade show, it would be a minimum of five years before all companies are completely out of the Mart due to companies having staggered leases. One thing is certain, according to Channer, there will not be both. "We will have a trade show only if it replaces permanent showrooms."

BIFMA is based in Grand Rapids, Mich.; one of the primary areas for office furniture manufacturers. Its members include the ten largest office furniture manufacturers and 20 of the 25 manufacturers. The association boasts members throughout the United States, Canada and Mexico. In 1990, the industry totalled $8 billion in shipments.
COPYRIGHT 1991 Vance Publishing Corp.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1991, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Title Annotation:Business and Institutional Furniture Manufacturers Association; National Exposition of Interior Contract Furnishings
Author:Garet, Barbara
Publication:Wood & Wood Products
Date:Aug 1, 1991
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