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Your Business Commentary

Mike's often irreverent, thought-provoking analysis of the industry-- with an occasional guest columnist.

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The CLN Interview: Steve Berger, CEO, Craft & Hobby Association

Answering questions about the move to Orlando.

by Mike Hartnett (July 28, 2008)

(Note: Brenda is head of Brenda Pinnick Designs and 

by Mike Hartnett (August 4, 2008)

(Note: At the recent Summer Show in Rosemont, CHA announced that the show would move to Orlando in 2009, immediately followed by a consumer show. Because rumors began to spread regarding the details of the shows and CHA's reasons for the move, CLN interviewed Steve Berger.)

Pt. I: The Summer Trade Show

CLN: What are the dates for the 2009 Summer Show?

BERGER: The dates of the 2009 CHA Summer Convention & Trade Show are July 28 - 30. Show dates have been altered to run Tuesday - Thursday to attract more buyers to the Show and avoid long weekends.

CLN: Why move the show from Rosemont?

BERGER: CHA is tasked with growing the CHA Summer Show and increasing member benefits for attending. Rosemont has hosted the Summer Show for over 20 years. There had been a steady decline in the numbers for the ACCI show. When ACCI and HIA unified, the new entity, CHA, took over the summer show and for two years, it grew. (4 - 5% increase in exhibitors; 40% increase in pre-registered attendees.)

But within the last two years there has been a decline of exhibitors and 8-10% in attendees. In 2008, the Summer Show attendance was down by almost 7% and exhibitors down by more than 13.5%. The CHA staff has done a good deal of research over the past few years (including surveys sent out after the summer shows to exhibitors and buyers) to solicit member feedback on viable alternatives to Rosemont.

CLN: Isn't it possible that the Summer Show simply reflects changes in the industry, rather than a problem with Rosemont?

BERGER: This is possible, but changes in the industry would also impact other shows like the CHA Winter Show, which has not witnessed the dramatic declines that the Summer Show has. The easiest thing for CHA to do is to do nothing, but we are tasked with growing the show and increasing member benefits for attendance. If we do nothing we are not looking out for the best interest of the show, the industry, nor our collective CHA membership.

CLN: Why Orlando instead of someplace in the Midwest? Won't it be awfully hot?

BERGER: Orlando is a destination location and ranks second by Tradeshow Week magazine as the leading host city by number of trade shows, share of market, and square footage. Other cities in the Midwest were explored. As 60% of CHA Summer Show attendees travel by plane to the show, having direct and international flights available was a limiting factor for some venues.

Chicago and Orlando have comparable temperature ranges. As a matter of fact, average highs in Orlando and Chicago range between 84 and 92 degrees, while average lows in Orlando and Chicago range between 66 and 73 degrees.

CLN: Did you poll CHA members or study how many members live within driving distance of Orlando?

BERGER: Yes, over the past few years CHA surveyed its members and, based on member feedback from the 2006 CHA Summer Show Attendee Survey, 40% of those interviewed rated Orlando as either first or second choice of venues, if CHA relocated the Summer Show. CHA also conducted research that found consumer craft spending is highest in the South with $12.1 billion dollars, almost twice what the Midwest consumers spent, $6.9 billion. CHA membership in both Illinois and Florida was reviewed and found to be comparable. There are 204 designated buyers in Florida versus 209 designated buyers in Illinois.

CLN: CLN heard CHA is getting the hall for free. If so, are those savings going to the exhibitors?

BERGER: While Orlando has offered significant cost savings and financial incentives to relocate the show, we aren't able to discuss the confidential details of the agreement. However, you should note that our objective is to provide exhibitors with comparable costs in Orlando. We are looking at hotel costs that are the same or lower than 2008 rates in Rosemont.

CHA will be spending significant dollars to promote the shows, and the savings from the hall can be used for this.

CLN: For exhibitors, how will the costs for booths, drayage, etc., compare to those in Chicago? Is the convention center a non-union hall?

BERGER: Florida is a right-to-work state, which means that the Orange County (FL) Convention Center works with both Union and non-union vendors. For CHA it means that there are more things that exhibitors will be able to do themselves without hiring assistance. We anticipate that costs will not be higher than current 2008 fees at Rosemont.

CLN: For attendees, what is the difference in lodging and parking costs, and transportation to/from the airport to the hotels? Are the hotels within walking distance of the convention center?

BERGER: In Orlando there are three hotels and hundreds of rooms within walking distance from the Convention Center, the hotel rates will be the same or lower than those in Rosemont in 2008, and parking is secured at $10 for 2009 where parking in Rosemont for 2008 was $11 per day.

CLN: What about plane fares compared to Chicago?

BERGER: Initial reports are that airfare to Orlando is very competitive with those rates to Chicago O'Hare. Individual fares will vary based on point of origination, fuel costs, carrier, and when tickets are purchased.

CLN: Did you sign a one-year contract? What happens in 2010?

BERGER: CHA is negotiating a one-year contract with a second-year option if we meet certain growth criteria for the show. As contracts are in legal review, we can't comment further on the details. What happens in 2010 will depend on what happens next summer in Orlando.

Pt. II: The Consumer Show

CLN: Do the trade exhibitors have to exhibit at the consumer show immediately following the trade show?

BERGER: No. CHA Summer Show exhibitors do NOT have to exhibit at the consumer show. Exhibitors have the option of exhibiting at the Summer Show, the Consumer Show, both, or neither if they so choose.

CLN: What will the cost be for booth space?

BERGER: Pricing and packages that provide the best value to CHA members are currently being developed. We will have final packages available in 2- 3 weeks.

CLN: Can the manufacturers sell product? Won't that hurt area retailers?

BERGER: The Consumer show will be open to all CHA members, including manufacturers. While CHA can not dictate what exhibitors do, CHA envisions and recommends that manufacturers host make-it/take-it projects, and education and projects sheets that avoid competition with retailers. Savvy manufacturers will explore partnerships that best highlight their products and retail partnerships to maximize product exposure to the general public and drive consumers to local retailers.

CHA research shows that 57% of U.S. households craft at least once a year. CHA research also shows that retail craft sales actually increase in a market six months following a trade show because the show inspires creativity and craft ideas.

We encourage all CHA members to use a long-term perspective on what will benefit the industry as a whole to create consumer interest and drive consumers to retail. CHA believes that this will be amplified as CHA looks to reach out directly to the consumer with a broad array of crafts and education, further driving consumers to retail for the benefit of the entire industry.

CLN: Will manufacturers have to move from one hall to another when the trade show ends?

BERGER: Not necessarily, but this is a good question and currently under review. We will keep you posted on how this pans out.

CLN: If manufacturers exhibit at both shows, that means the staff will be out of the office for a long time.

BERGER: If you keep the same exhibits people in Orlando for both shows, yes, the staff will be out of the office for a long time.

CLN: Can area retailers exhibit at the consumer show?

BERGER: Yes, area retailers can exhibit at the consumer show as long as they are CHA members and pay the exhibit fee.

CLN: Have area retailers promised support in terms of exhibiting, consumer advertising, etc.?

BERGER: We are working with local retailers on promoting the consumer show in a non-competitive way that will drive traffic to stores and to the show. Local marketing plans are also currently under development.

CLN: Can professional crafters who are CHA members exhibit and sell their finished projects?

BERGER: CHA members who are professional crafters will be able to exhibit and sell finished projects at the consumer show. We are looking at show floor layouts that best facilitate the various exhibiting needs of our members.

Pt. III: General

CLN: You have conference calls scheduled for members who have questions. When are they and how can someone participate?

BERGER: That is correct. While all of the details are not finalized, we want to address any and all questions, suggestions, and ideas that members may have. To talk to me directly about the CHA Summer Show move to Orlando or the Consumer Show, I've scheduled several conference calls and opened them to CHA membership. One was held last Friday, and the other three originally scheduled are filled, but we will schedule more of them in September.

Limited space is available. Conference call participation will be scheduled with pre-registration only and on a first-come, first served basis. To be put on the mailing list for one of the September conference calls, please email Tara Smith, Marketing Coordinator, at tsmith@craftandhobby.org, or call 201-835-1223.

ANY CHA member who wants to participate will have the opportunity to do so, either through additionally scheduled sessions or by contacting Steve Berger directly at 201-835-1201, or email me at sberger@craftandhobby.org.

(Note: Now that you've read the thoughts behind the move, click on Industry Polls in the right-hand column and vote. If you have questions or comments, contact Steve directly or send your thoughts to CLN at mike@clnonline.com.)

xxx

 

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