Since the beginning of the year, Shepard Exposition Services has announced either new facilities or expansion of existing facilities in Las Vegas and Ontario, Calif. Then, late last month, Shepard announced it had acquired US Expo & Convention Services, a smaller contracting company that services events primarily in Phoenix, Tucson and Albuquerque, N.M.
Expo Executive Editor Michael Hart spoke with Shepard President Carl Mitchell about all this and asked him to outline the strategy underlying these recent moves into the Southwest.
Expo: Why all this expansion and acquisition activity in the Southwest all of a sudden?
Carl Mitchell: The fundamental thing is that Las Vegas remains strong regardless of whatever the competition throws their way. It’s so strong that, if you’re going to be on the West Coast, you have to have a flag in Las Vegas.
In looking at it, we didn’t want to be isolated and have a major city covered and not be able to use that location as a distribution point.
For 2014, we’ve been successful in booking shows in Southern California. It was in our business plan to go ahead and add to the West Coast presence. It’s only a four-hour drive between those two places.
Our heaviest expense is transportation. By expanding our Southern California presence and getting far enough out of the heavy cost area of L.A. in Ontario, we are able to take care of all the Southern California area, including Palm Springs.
Expo: Phoenix has a nice convention center, but it’s not, up to know, been known as a major trade show destination. What’s that about?
Mitchell: Phoenix will surprise you. If you look at the data, you see it’s a bigger convention and trade show destination than people might think. When you mention the big convention cities, Phoenix doesn’t get mentioned a lot but, in fact, it’s huge. They’ve got a lot of corporate meetings as well.
The opportunity came up in a conversation that there might be a way to go in there and purchase a company that was booking a lot of business, but thought they could be more successful if they had a better-known brand on their door.
We went in and started negotiations in late October. Right after the first of the year we were able to come to an agreement.
When you combine Phoenix with Southern California and Vegas, you’re talking about an incredibly robust market for the convention, trade show and meetings business.
Expo: How does all this work together?
Mitchell: Now we have three branches that can support each other. The hub is Las Vegas. We have a major carpet distribution facility in Las Vegas that will support both Phoenix and Southern California with large exhibit hall carpet.
The longest distance between any of the offices is about four hours. They can share equipment, share resources, share people.
We’re the kind of company that can be nimble, yet we offer everything the larger companies offer. There was not a company that was in that Western market that was like us. We think the market’s right for what we’re selling.
Expo: So you see a lot of growth in the events market in Arizona in the near future?
Mitchell: It’s sort of under the radar a little bit. You’ve got an amazing number of first-class resorts in the Phoenix-Scottsdale area. They’re not huge in terms of rooms, but they are huge in terms of public space.
We noticed that a number of our national accounts were having board meetings and smaller conventions out there, especially in the bad weather months. Then, with L.A., when you do the math and add San Diego, Long Beach, Anaheim, Palm Springs, you have an incredible market.
And Vegas, of course, is still Vegas.