The Pack Expo Experiment: Is It Feasible for Show Management to Be Their Own General Service Contractor?

LISA GOELL SINICKI, SENIOR EDITOR
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Arlington, VA – In November, all eyes were on PACK EXPO in Chicago’s McCormick Place  to see if it was really possible for a show with over 1.2 million net square feet of exhibit space and 2,000 exhibiting companies to act as its own general contractor.  Did it work? Will other show organizers attempt to become their own general contractors? And what does it really take to pull this off?

A 95% positive rating from exhibitors for on-site operations and a positive bottom line for the Packaging Machinery Manufacturers Institute (PMMI) indicate that PACK EXPO’s experiment was successful. Chuck Yuska, President of PMMI, says PACK EXPO is pleased with its results and is committed to continue as its own general contractor for at least three more shows. Yuska says the association met its goal of lowering exhibitor costs and providing better customer service. In addition, Pack Expo Services (PES), the company PMMI formed to manage the services, made a profit. However Yuska is the first to say that pulling this off wasn’t simple and isn’t something he’d recommend to everyone.

In an exclusive interview with Trade Show Executive, Yuska shared the following key considerations he feels are imperative in determining if this route will work for your organization:

  • Do it for the right reasons. Yuska says these are to stabilize costs and improve customer service.
  • It is a financial risk. “If you’re thinking of doing it for the money, don’t,” says Yuska. “You might not make money and you have to be ok with that.”
  •  Capital is required to get started. This is to pay for deposits with contractors and to fund the salaries of additional or contract team members.
  • There will be a significant increase in work load. Someone has to take care of all the details that usually get done by the general contactor. For PACK EXPO, Yuska and his staff did their own contracts and contract administration, and PES hired two experienced people to manage the on-site operations, labor and order equipment. Exhibitor customer service was outsourced to another company, and a small army of freelancers and independent contractors was hired to ensure smooth on-site operations. Yuska estimates his own work load was increased by 25% to 30%. “Some shows may be too small to absorb these additional management costs,” says Yuska.
  •  The show department has to understand what it’s doing. You may not be hiring a general contractor but you still need experienced people who know how to perform the general contractor’s job. PES had to lease equipment from other contractors, and hire and manage contractors to supply labor, carpet, furniture, AV, as well as schedule, plan and manage all show-site activities and operations.
  • Board support is a must. Yuska says to succeed you have to have the support of your board. “It’s even better if the members of the board are exhibitors themselves,” says Yuska.
  • Expect increased pressure and responsibility. “Usually I play the role of ‘association executive’ at the show,” says Yuska. This year he was there from the first day to the last day —move-in to move out — dealing with insurance claims, damage, solving problems and attending meetings.
  • You will be blamed for things that are out of your control. If an exhibitor is upset with something, it will be seen as your fault, says Yuska, even if it was something beyond your control such as when an exhibitor’s shipping company misses its targeted move-in.
  • You will have to explain what you are doing to the exhibitors.  Many exhibitors did not initially trust the transition from a separate drayage bill to including drayage charges in the space rate — and expected a hidden charge to be revealed on show site. “We had to really talk the exhibitors through this before they believed that their total bill would be even or lower than previous years,” says Yuska.

Reach Chuck Yuska, President, Packaging Machinery Manufacturers Institute at (703) 243-8555 or cyuska@pmmi.org.

Results from PACK EXPO 

Yuska says that being your own general contractor is hard, yet PACK EXPO is committed to continue for three more shows. Here’s why:

  • PES was able make a profit which Yuska says will eventually be passed back to the exhibitors.
  • Exhibitors loved getting one invoice and working with one customer service rep to order all their show services, says Yuska.
  • 75%-80% of exhibitors saved on drayage, which was charged at a flat fee based on the square footage of exhibit space and added to the space rate. The rate used to determine the fees was equal to the 2002 rate.
  • PACK EXPO was able to hold the 2002 labor rates, and in most cases the cost of carpet and furniture was lower than in previous years.
  • PACK EXPO identified areas where they can be more efficient in the future and pass additional savings on to the exhibitor. For one, they were overstaffed with customer service reps on show site. “We over-did it with management because we couldn’t risk failing,” says Yuska.
  • An exhibitor survey revealed that 98% of exhibitors had their expectations met or exceeded by the level of customer service pre-show.
  • 95% of exhibitors had their expectations met or exceeded by the level of customer service at-show.