^{March 2001}

Relations Between Nations

Strategic alliances are key to producing an overseas show

By Joseph Conlin

When Margaret Cassilly tried to ignore the saying, “it’s not what you know, but who you know,” she learned the hard way — the very hard way. With years of show experience under her belt, she knew the ins and outs of the industry, but not when it came to overseas shows. When she planned her first high-tech show overseas, local government and association officials boycotted her efforts. “I was almost thrown out of the country,” recalls Cassilly, a trade show consultant. 

The officials would not assist with local promotion or help contact local exhibitors, and even freight forwarding became an issue, says Cassilly. She postponed the show to rethink her approach, visited the country and met with local association and government officials. She then invited them to her U.S. show and treated them as VIPs, all of which helped make them feel comfortable with her and with the objectives for the show. After this, she was able to enter into an alliance with the local association, which then helped with attendance promotion and exhibit sales. A year later, the show went off without a hitch. 

“A strategic alliance is a necessity to produce an overseas show,” says Cassilly. 
When creating an overseas alliance, it can be easy to forget the differences among cultures. It’s important to always stay focused and flexible.

Hunting for a partner 
Begin by talking to the marketing managers for your major international exhibitors. Ask if they exhibit in shows that market products similar to your show. 

Other sources of information about potential show organizers include government agencies, such as the International Trade Administration (ITA). Through its contacts at U.S. consulates, ITA will provide show managers with contacts at overseas associations, government agencies, exhibition halls or other show organizers. Officials at tourism bureaus and convention centers can also introduce show managers to potential contacts. For example, Allen Ha, Director of Business Development for the Hong Kong Conference and Exposition Centre, notes “the centre offers various incentives and assists by introducing American show organizers to potential local partners.” 

Some exhibition centers enter partnerships. For example, Messe Dusseldorf North America has linked with Conexpo Leon in Mexico to produce Hospimedica 2001, the International Trade Show for Medical products, Equipment and Services. Conexpo Leon, which owns Poliforum exhibition center where the show is to be held, will act as general contractor and will promote local attendance. 

Evaluating potential partners
Your potential partner needs one quality — the ability to promote a show on a local basis. “Success is based on local participation,” says Stephen Sind, Vice President and Director of International Events for Cleveland-bases Penton Media Inc. “That means distributors as exhibitors are driving the event as opposed to international companies.” Local distributors or importers may team with their international suppliers, but the local company brings the knowledge of the market, the customs and the customers, giving the show steam locally. Penton’s overseas partners are responsible for local participation, while Penton works on international participation. 

A new show can also gain steam locally by co-locating with an established exhibition. This is Peter Nathan’s preferred method. Nathan, Principal, Compass Group International, Westport, CT, says
that to have a built-in audience, while at the same time drawing new exhibitors, it’s important to scout out an overseas show selling products and attracting an audience similar to your show. 

“This type of homework prior to entering a joint venture or co-locating is critical to the eventual agreement,” says Nathan. He suggests studying the track records of potential candidates by finding out how they worked with other organizations. For example: If they were responsible for attendance promotion, how many attendees were at the show? If they were responsible for local exhibit sales, what were the results? If they handled freight forwarding and arranged for the space and the show contractor, did the show run smoothly? 

Negotiating 
“It’s not easy making sure that you’ve connected with the best partner. There are differences with language, economics and business techniques,” says Nathan. Even negotiating styles vary. The American let’s-get-down-to-business approach is not effective in most cultures.

You must work your way to the top, Cassilly says. It’s critical in some cultures that you make the effort to visit their offices and to see their shows. You will have to socialize with your potential partner before you can hammer out the details of a deal. When Cassilly is attempting to partner with an overseas association, she’ll visit members, usually during one of their events. She brings collateral, show directories, press releases and write-ups about her show. She also invites the association’s board members to her show in the United States. 

There are no formulas for negotiating and no standard percentages, each partnership is unique. 
You can discuss complimentary exchanges of exhibit and advertising space, but true negotiations revolve around who’s doing what task and for what revenue. To do that effectively, you must first understand “how they do what they do,” says Nathan. 

“Don’t assume that they will do things as you expect them to be done,” he says. “For example, if you rely on overseas organizations to sell exhibit space with heavy telemarketing, you could be mistaken.” Show organizers in Hanover and Dusseldorf send one announcement to exhibitors. Since they generally have a waiting list of exhibitors, they just wait for replies. “It’s not the exhibit space sales effort we as Americans do,” notes Nathan. The German organizers are confounded by the American dependence on telemarketing to sell exhibit space, he says.

Different styles of doing business do not preclude a deal. Dividing responsibilities, such as handlingthe marketing while your partner handles logistics and local promotion, could be the answer. In one alliance, Nathan was responsible for attendance and exhibitor promotion, but with a twist. Realizing that neither he nor his partner had enough expertise to market the show effectively, he convinced his partner that they should share the additional expense of hiring a marketing and advertising company. 

Financial negotiations also vary depending upon local markets and the partners’ objectives. Generally, they are based on tasks performed and risks assumed. Even if the arrangement is to divide revenue and work equally, you must spell out responsibilities. Who is responsible for exhibitor sales locally and internationally? If you are working with an overseas association, will you give their members discount rates on exhibit space? Will the fees for local and international attendees be the same? If you’re an association show manager, will your association offer the overseas association’s members services for the same fee as your members? Who will promote attendance locally and internationally? Who will contract with the convention center, service contractors and local authorities? How will deposits with hotels and convention centers be handled? How much will be spent on each of these areas? How will revenue be reported and dispersed? Will there be an audit and, if so, by whom? Asking questions that may seem basic and mundane may actually save you time and money in the long run.

Good deals are the same the world over. Understand how your international partners operate, know their strengths and their weaknesses, and define the responsibilities — financial and otherwise. “Each party has needs,” says Sind, “Fulfill those needs and you’ll create a strong partnership.”

Joseph Conlin ( joseph_conlin@yahoo.com) has written about the exhibition industry for a variety of magazines over the past twenty years. He also edits an online 
publication called SNReview.