Home
Business-Wise
Kate's Collage
"Vinny Da Vendor"
"Benny Da Buyer"
Kizer & Bender
Memory, Paper & Stamps
Category Reports
Designing Perspectives
Trade & Consumer Groups
Subscribe to CLN
Scene & Heard
Jobs
Industry Research


Creative Leisure News
2677 Ashley Ct.
Tremont, IL 61568
Phone: 309-925-5593
Fax: 309-925-9068
Email: mike@clnonline.com

 

 


Your Business Commentary

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

Printer Version

 

Debate: CHA Summer Show Expenses

An angry exhibitor vents -- and CHA's response.

by Ken Petersen, Product Performers and CHA's Steve Berger (March 22, 2011)

(Note: the following is an email sent to Steve Berger at CHA. Ken cc'd exhibitors from the Los Angeles show. CLN invited Steve to respond, which he did – and Ken responded to that.) 

We received the contract for the CHA Summer show last week and I am appalled at the huge price increase for Exhibit Space. From my perspective, CHA has concocted the smoke and mirrors gimmick of selling "Bonus" 10'x10' Booths for $10 each under the guise of fooling us into accepting what in reality is the largest one year cost increase for Exhibit space the craft industry has ever seen. I think this entire idea of raising Exhibit Space prices from $17 per square foot of booth space in 2010 to $21 per square foot (numbers rounded) in 2011, and then telling us we're getting extra space for just $10 more is an insult to our intelligence.

This charade is paramount to a landlord telling a tenant, I've got some good news and some bad news for you. The bad news is that I'm raising your rent by 23% this year. The good news is .... you know that extra space in the complex that I can't get anybody to rent any more because of the poor decisions (think Orlando & Los Angeles) I've made in recent years? Well, instead of the space sitting empty again for another year, you can have it for just $10 (on top of the 23% rent increase for your current space). To that I would say, thanks for nothing!
 
If any landlord in the country tried doing this with their tenants in this economy, they would all move out in a heartbeat. Or in our industry's specific case, find a new, more affordable way to market themselves. As they say, necessity is the mother of invention, so why or how does CHA think it is a good move to create this necessity for its members? Is the illusion of a larger show this year more important to CHA than actually trying to ensure the long term success of it by keeping it affordable to exhibitors? What happens in 2012 when exhibitors are asked to pay $21 psf for their artificially enlarged booth space from 2011? Of course hardly anyone would be able to afford their booths without downsizing, so then the whole "show is growing" illusion will come crashing down like a house of cards.
 
Obviously for some exhibitors, the Bonus Booth scheme may work in their favor. But for your long term "tenants" that have Exhibits that fit a certain footprint and do not need or want any extra space, this is a bad deal! A larger booth does not necessarily translate into extra sales, but it certainly translates into extra costs beyond the floor space. i.e. extra shipping costs, union labor set up costs, internal labor costs, hotel rooms for the extra employees to cover the "bonus" space, etc.
 
As for my company, we have spent the days since receiving the 2011 Exhibit Space Contract designing our downsized booth. We are going to fit very nicely into a 20'x20' booth, which is 1/2 the size of our CHAW 2011 booth. Yes, necessity truly is the mother of invention. Our downsizing for the summer show is not necessary because business is bad (it is actually very good for us), it is necessary because your 23% increase blew our show budget. I wonder how many other show budgets this ridiculous price increase is going to have an effect on?
 
I truly hope this price gouging does not speed the downward trend of the CHA shows and cause things to spiral out of control, but as it stands, it may quite possibly be the straw that breaks the show's back. The Craft Industry needs the CHA shows to not only survive, but to thrive. If we are going to survive and thrive though, we cannot be priced out of the show market. Like any business, CHA needs to keep their costs under control and price their goods and services at an affordable rate for the masses. To do otherwise, marks certain failure.
 
Please feel free to Reply All to this email so that all CHA Members cc'd (from CHAW Show Directory) can hear what you have to say on this subject. 
 
CHA's Response

Dear CHA Members, 

First, thank you for your patience this week while being copied on multiple e-mails surrounding confusion in regard to CHA's 2011 Summer Show pricing. I'm also appreciative of your understanding that my response comes several days after the initial e-mail, as I have been careful to take this time to diligently review the questions submitted and have had multiple phone calls directly with Ken Petersen and several others, all of whom I appreciate and respect as valued CHA members. While we still disagree on some issues, after discussion and explanation, Ken Petersen agrees that with the new booth package his booth costs for 2011 will be almost the same as they were in 2010 since he is local to Rosemont and brings his own carpeting and furniture.

In most cases we estimate that exhibiting companies will save approximately $400 per booth if they take the full package.

I'd now like to take this opportunity to provide further clarification on pricing for the 2011 Summer Show. To review the pricing in appropriate context, last year's price per square foot with added a la carte services would equal a higher total cost to members this year than the new inclusive package pricing. Should members choose not to use or do not need items in the package, then the cost to exhibit at this year's Summer Show per square foot alone is higher. Although we cannot meet everyone’s needs and requests 100% of the time, I am pleased that our CHA team was able to develop a new pricing structure this year that was created from CHA member feedback, since a large majority of members utilize items in the inclusive package.

Alyson Dias, of iLoveToCreate, sent me the following e-mail this week and has agreed to allow me to share it with all of you.

"I want to send my support on this issue. After review of the new contract versus last year's cost, we should actually increase our booth space over last year to a 30x40, so we gain additional material handling costs in our favor, reducing the total show investment. Therefore, I believe we can increase our booth space without increasing our costs. Nice job."

Again, I understand there is a group of CHA members for whom the new pricing structure is not as beneficial. However, CHA strives to seek member insight and act on it by developing programs and pricing models that address the valuable feedback we receive. From what members have told us you want from your Association, CHA's objectives have not wavered as we focus on:

-          containing/decreasing total Show cost to members;

-          increasing product diversity of exhibitors;

-          increasing size of the Show with more exhibitors; and

-          increasing size of the Show with more buyers through programs encouraging new buyers to attend.

In summary, I hope this information has been helpful to answer questions you may have regarding Show pricing, value, background, and CHA's commitment to fairly representing you as members, advocating on your behalf, and striving to meet your needs. Please do not hesitate to call me directly with any additional questions, as I welcome the opportunity to speak with you one-on-one, as Ken and I have done.

In the meantime, we’ve already had a great initial response to the 2011 Summer Show and hope to see each of you there!

And Ken Pattersen's Response

Dear Mr. Berger,
 
Thank you for the courteous responses this week from both yourself and Mr. Lee. While there remains many things that we still disagree on, I am pleased that my email has at least opened up a dialogue on not only the pricing structure of CHA, but other subjects as well.

After getting over the sticker shock of seeing booth space rise from $17 psf last year to $21 psf this year, I do now see that the partial free drayage offer this year just about offsets the increase for the actual Exhibit Floor Space. The point that I have been expressing though to you in our phone conversations the past week is that before the decision of moving the summer show to Orlando, the drayage was always basically free in Chicago. But upon our return last year that perk was taken away. Now that CHA gave us back 70% of the drayage perk, the booth prices were raised 20% to offset it. I just don't believe CHA should be playing those kind of games with the prices. Why bother partially giving the free drayage perk back if you raise the prices in another category to offset it?!
 
Now that I have a better understanding of the situation, breaking the math down in short: Factoring in the current CHA price structure, on average it costs just about the same to exhibit this year as last year, but it does cost many exhibitors 20% more for floor space plus higher drayage charges to exhibit in Chicago now than it did before Orlando. Personally, I regret not sending out an email to the member base a year ago about that large price increase.

Another one of my concerns is that the $21 psf Exhibit Floor Space for the summer show will set the precedent for the 2012 winter show where full drayage is charged. Some transparency at this stage from CHA on that issue would be greatly appreciated so that show budgets can be figured out. 
 

I know you realize that I do not want to promote negativity towards the shows. They are a very important part of our industry and have certainly been an integral part in my own company's growth over the years. We all need to work together to ensure the show's long term success. Communication with all the members of CHA and acting on their concerns is the key to that success. While it is important for members to communicate with you one on one, members can now see the easy forum we have to get our thoughts and ideas out there to everyone. Speaking of forums - How about creating a message board on the CHA website where all members can communicate and discuss ideas?   

Mr. Berger, another important issue that should be addressed is the CHAW conflict in dates with the Paper World show. Can you please explain to the members why the winter show continues to be held at the same time as Paper World? This scheduling conflict was a very big concern to many of the members that responded to my previous email. 

(Note: Everyone is welcome to join the conversation. Email your thoughts to Ken, Steve, and CLN: mike@clnonline.com.)

xxx

 

horizontal rule

horizontal rule



   
   

Business-Wise Recent Columns...
AN INTERVIEW WITH CHA'S MEMBERSHIP VP SUE TURCHICK; Why and how CHA is forming chapters and sections.

Q. & A.: MARKETPLACE FAIRNESS ACT; Lots of questions -- and some answers.

MAKE YOUR CUSTOMER NUMBER TWO; Want to provide fresh customer service? Ignore conventional wisdom.

AN INTERVIEW WITH CHA'S Andrej Suskavcevic; Explaining why and how the summer show is changing.

CHA-UK GETS ROLLING; The UK trade group is working hard to strengthen the industry in Great Britain.

THE TROUBLE WITH TRAFFIC: WHAT RETAILER CAN LEARN FROM BASEBALL; What are the right number?

SOME THOUGHTS ON CONSUMER SHOWS; Some help retailers, some don't.

READERS RESPOND TO CLN'S TREND ANALYSIS; Different perspectives, thought-provoking ideas.

THE STATE OF DECORATIVE PAINTING; Responses to CLN's analysis.

SHOW THEM THE LOVE WHEN YOUR CAN'T SHOW THEM THE MONEY; Five affordable ways to boost employee happiness, loyalty, and motivation.

HOW TO MANAGE -- AND MOTIVATE -- CHALLENGING EMPLOYEES; Key advice from OfficeMax cofounder Michael Feuer.

AN OPPORTUNITY FOR CHA TO GROW; Provided we all work together.

TOP TEN THREATS TO DATA SECURITY AND PRIVACY FOR BUSINESS ... and what to do about them.

TRADE SHOWS: HOW, WHERE, & WHY; An interview with Tony Lee, CHA's VP of Meeting and Expositions.

DEBATE: CHA SUMMER SHOW EXPENSES; An angry exhibitor vents -- and CHA's response.

WHAT TO DO WITH OUR TRADE SHOWS; Readers respond.

WHAT'S HAPPENING TO OUR TRADE SHOWS? And what does it mean for the future?

DRIVING M&A SUCCESS IN 2011; Advice on buying -- and selling -- a company.

MAGAZINES AND THE INTERNET; In What form will magazines survive?

DON'T CLOSE YOUR STORE, SELL IT! Because almost all store can be sold.

THE ART OF DISCOUNTING; Activate dormant customers with strategic discounting.

AN INTERVIEW WITH MIKE MCCOOEY; CHA'S finances, staff, shows, and the future.

MEMORIES OF MIKE; New additions: Mike Dupey, remembered.

THE 8 DRIVERS OF EXECUTIVE DECISION-MAKING; Improve sales by understanding how key customers think.

7 KEY STEPS TO MOVE YOUR COMPANY FROM SURVIVING TO THRIVING; Difficult, challenging – but essential.

WHAT IS THE FUTURE FOR TRADE SHOWS? Surely they will change - but how?

SO, WHY AREN'T WE HAPPIER? Maybe the theme song for the January trade shows should be Elton John's "I'm Still Standing."

GREEN IS THE NEW PRIMARY COLOR; But the subject isn't so simple.

UPDATE: CHA SUMMER TRADE AND CONSUMER SHOWS; So much to do, so little time.

7 STEPS TO BEING A BETTER LISTENER; Which will make you a more persuasive salesperson.

INSPIRING TOURISTS TO SPEND; They have certain needs that are different than your regular customers. Meet those needs and they will spend.

WHAT BUSINESS CAN LEARN FROM NONPROFIT ORGANIZATIONS ABOUT INSPIRING CUSTOMERS; Don't just please customers, inspire them.

DETAILS ON THE ORLANDO TRADE AND CONSUMER SHOWS; An interview with CHA's Tony Lee, VP Meetings & Exhibitions.

HOW TO DEAL WITH A STRESSFUL WORK SITUATION; Four lessons from Captain Sully's landing in the hudson.

THE 7 PRINCIPLES FOR INSPIRING EMPLOYEES; Honesty, openness, and ...

WHAT PRESIDENTS' SPEECHES CAN TEACH YOU; Lessons to make your presentations more effective.

A LETTER FROM CHA'S STANDARDS AND TECHNOLOGY COMMITTEE; You need to learn the new law or else...

WHY THE CONSUMER IS BORED; Reactions to Bob Ferguson's analysis of the industry.

WHY INDUSTRY SALES ARE DOWN; The answers are more complex than simply the recession.

A LETTER FROM AMERICA; The state of the craft industry in the US.

STOP COMPLAINING AND BE CREATIVE; Our problems are just opportunities in disguise.

WHAT HAPPENED TO OUR TRADE MAGAZINES? Their decline is a sign of a changing industry.

THE CLN INTERVIEW: STEVE BERGER, CEO, CRAFT & HOBBY ASSOCIATION; Answering questions about the move to Orlando.

THE LOBBYING EFFORT IN WASHINGTON; Leading the charge against the Orphan Works legislation - and an opposing point of view.

CHA MEMBERSHIP CALL TO ACTION; CHA's May 30th blast email to members.

HOW TO SCREW UP A GOOD COMPANY; So many ways to kill a business.

WHAT WE HAVE HERE IS A FAILURE TO COMMUNICATE! Which explains why some product categories are in decline.

WILTON CELEBRATES ITS 80TH ANNIVERSARY; An industry giant began in a single room.

MAKING MY CHA SCHEDULE; So many events, so little time.

READERS WEIGH IN ON INDUSTRY CHALLENGES; Chain stores, beads, and yarn.

TNNA, CHA LEADERS SPEAK OUT...on the challenges facing the industry in 2008.

LISTENING TO CONSUMERS; Demographic studies and message boards aren't enough.

ARE SOME SCRAPBOOKERS "CRAZY"? Reactions from retailers, vendors, and others in the business.

THE DECADE'S MAJOR INFLUENCES, PT. VI: WAL-MART; So much to say, so little space (even on the Internet).

THE DECADE'S MAJOR INFLUENCES, PT. V: IMPORTS; Random thoughts...

THE DECADE'S MAJOR INFLUENCES, PT. IV: CHANGES TO THE OLD ORDER; Evidence that the way things are today will change tomorrow.

THE DECADE'S MAJOR INFLUENCES, PT. III: THE NEW GENERATION OF CONSUMERS; They've just begun to shake up traditional order.

THE DECADE'S MAJOR INFLUENCES, PT. II: MICHAEL ROULEAU; Imagine if Michaels had gone bankrupt?

THE DECADE'S MAJOR INFLUENCES, PT. I: SCRAPBOOKING; History, analysis of today, and the future.

CHA RESPONDS TO THE SMART GROUP; CEO Steve Berger on scrapbooking, PMA, and the winter trade shows.

A CODE OF ETHICS FOR OUR INDUSTRY; For retailers, manufacturers - and the rest of us.

PROVO RESPONDS AGAIN TO CHARGES; The Salt Lake Tribune's article is "irresponsible."

PREDICTIONS FOR THE NEW YEAR; The industry, television, yarn, and more.

PREDICTIONS FOR 2007; From manufacturers, a retailer, a distributor, and a sales rep.

WHAT CAN HAPPEN WHEN YOU SHAFT INDEPENDENTS; A common, sad story.

THE NEW CRAFT CONSUMER; Where is she? All around us.

SO, WHOM SHOULD WE HAVE ROOTED FOR? Who would be better -- or worse -- for Michaels, Bain or KKR?

WHY TRENDS EVENTUALLY COOL; Yarn sales may have slowed, but that can be true for any trend. Here's why.

CHEAPER TO BUY CLOTHES THAN CLOTH; Imports and "Pile it high and price it low."

ANSWERS TO INDUSTRY QUESTIONS; Blunt, honest answers to questions posed by CLN.

THE MICHAEL ROULEAU ERA; Industry veterans and Wall-Street analysts evaluate Michaels retiring CEO and the board's decision to seek potential buyers.

EVALUATIONS OF THE CHA SHOW; Mostly positive but...

CHALLENGES: YOUNG CONSUMERS, MICHAELS FUTURE, NEW CEOs, MERCHANDISING ... Pricing, and much much more.

CHALLENGES: SCRAPBOOKING, BEADS, YARN, HOME DEC, & DECORATIVE PAINTING / CROSS STITCH; Savvy veterans comment on CLN's industry challenges.

TRADE SHOWS & MEMBER BENEFITS; The discussion continues.

TOO MANY TRADE SHOWS? Stop complaining, make hard choices, and try something new?

TOUGH TRADE SHOW QUESTIONS; Why not cooperation instead of competition?

THE STATE OF OUR INDUSTRY; Some positive analyses, some negative, and lots of questions.

WHAT'S HAPPENING OUT THERE? Some grim answers, and gas prices is only one of the culprits.

BARBARA BECOMES AN ENTHUSIAST, FINALLY; A first-hand view of a consumer getting hooked on a category.

RWANDAN WIDOWS EARN LIVELIHOOD WITH AMERICAN KNITTING MACHINES; $99,000 USAID grant provides livelihood for women in Rwanda.

THE CANVAS "DUMPING" ISSUE: ANOTHER VIEW: What is dumping? And is it necessarily bad?

WHAT TYPE OF BUYER/INVESTOR IS BEST FOR ME? Three types, each with their own pros and cons.

REACTIONS TO THE DECLINE OF THE "SMILING BUNNY SYNDROME"; But what will replace it?

ARE WE LOSING OUR CORE? YES AND NO; Readers respond to an intriquing question.

ARE WE LOSING OUR CORE? Is the industry abandoning many of the categories un the "craft" umbrella?

INTERVIEW WITH HSA'S JOYCE PERHAC; New programs and new trade shows.

CONSISTENCY VS. CREATIVITY; One of our chains just made a major goof.

THE BIG NEWS STORIES OF 2004: Some good, some bad, all of them interesting.

SO, IS THE GLASS HALF EMPTY? Conflicting, but thought-provoking analyses.

A CUSTOMER'S NIGHTMARE; Don't store clerks know anything about products?

WHY A KIOSK MAKES SENSE FOR YOUR; Why force your customers to visit your competition?

THE FUTURE FOR INDEPENDENT SCRAPBOOK RETAILERS; Is the deck stacked against them?

THOUGHTS ON FREE TRADE; It's not nearly as simple or as clear cut as either side believes.

WHAT MAKES A PRODUCT SUCCESSFUL? The hits have certain qualities in common, no matter what the category.

HOT TRENDS AND TRADE SHOWS; A hot category tends to take over a trade show, but not to savvy retailers.

WHY I DID NOT GO INTO RETAIL; The odds were too high.

WHY KATELYN CAN'T SWALLOW; Who pays -- and at what price?

RISING HEALTH COSTS, FEWER JOBS; The problems compound each other.

DEBATE: SHOULD WE JUNK "CRAFTS"?; What's a better word to describe what we are?

GAY MARRIAGES, CRAFT DESIGNERS, AND RETAIL PRICES; The meaning of words.

VENDORS DISCUSS HOBBY LOBBY'S SUCCESS; So many reasons for so much success.

HIA: A MARKETING / DESIGN PERSPECTIVE; Standing out in a crowd becomes a real challenge.

WHAT HASN'T CHANGED IN 25 YEARS; Plus some random thoughts on this wonderful business.

2003 IN REVIEW; As usual, lots of ups and downs.

THE CHANGING (DISAPPEARING?) CORE OF THE INDUSTRY; Bob Ferguson  and Mike Hartnett discuss the year's major issue.

LEAVING "CRAFTS" FOR SPECIALTY STORES; A tale of survival and a sign of the times.

THOUGHTS ON THE CHANGING NATURE OF CRAFTS; Vendors, retailers, reps, and designers share their views.

CRAFTS BECOMES PAPER CRAFTS; That's a sign of ... what?

SOMETHING ACHIEVED, SOMETHING LOST; The end of a hard, but wonderful era.

UNBLOCKING WRITERS BLOCK; How to get those creative juices flowing again.

PERSONAL THOUGHTS ON ACCI/HIA; Why bother combining associations?

THE LATEST ON ACCI/HIA; Further clarification of the ACCI/HIA unification effort.

HIA AND ACCI AGREE TO LETTER OF INTENT THAT WILL UNIFY ASSOCIATIONS; Combined organization to be named the Craft & Hobby Association.

HIA/ACCI: Q & A

ADAPTING TO CHANGE; Why some industry businesses fail.

BE CAREFUL WHAT YOU WISH FOR; You just might get it.

ARE WE STIFLING CREATIVITY?; How we're driving the industry's creative people out of business.