In a Deflating Economy, Trade Show Services are Skyrocketing
I thought I did alright in undergrad Economics. I might not have been the absolute brightest, but I am at a total loss in understanding why trade show service prices are skyrocketing for 2009. Trade Show Services primarily include Installation & Dismantle (I&D) of trade show booths; and “drayage,” or material handling; on top of other things like electrical labor, cleaning, lead retrieval, and catering. Not only are rates going up, but exhibitors are being gouged on top of those rates. Let’s get my anecdotal facts out in the open, before honing in on why.
I&D is the carpentry involved in putting together the exhibit. The installers unload the crates that exhibits arrive in, and piece together the booth. These are union contractors who work in a very compressed time frame to build an exhibit from start to finish. They lay carpet, frame structures, provide the finishing touches of graphics and stretching fabric, they place furniture in denoted locations, with electrical channels built into sub flooring or carpet pads. We’ve seen I & D increase by fully 30% in the past six months. It only seems to be getting worse, amidst a real estate crash that is leaving echelons of builders and remodelers out of work.
Drayage is the act of bringing crates that are unloaded at the Marshall Yard to the correct location on the show floor. Drayage is charged at a rate that the show will determine, and you have the option to have the show contractor handle drayage, or perhaps the show contractor can do it instead. To haul 5,100 lbs. of crates with a forklift is going to cost one of my clients $6,344. Last year, their rate for drayage was $95.00 cwt, whereas the 2009 price is quoted at $124.40 cwt - a 31% increase. Since they had a slightly smaller booth in 2009, they have effectively doubled their drayage expense for the show.
Electrical, cleaning, lead retrieval, catering - perhaps exhibitors will catch a break in the ancillary services that they order? Not likely. In fact, electrical labor is starting to be a reliably done on overtime. OT pay is reliably in order in todays trade show environment. Hence, the gouge on top of the the gouge.
So how can trade show services increase in price, while every commodity that is intertwined with providing such services is in decline? Fuel costs have plummetted; unemployment is up, reducing labor costs; and capital expenditures are down, decreasing demand and prices for heavy equipment like fork lifts. In fact, the number and scale of exhibitors is drastically reduced for 2009. So at the most elementary level: DEMAND FOR TRADE SHOW SERVICES IS DOWN.
Any “theories” as to why services aren’t going to be reduced any time soon? They seem to be making up for the decrease in demand by increasing their price, contrary to basic economics. But how can they do that while any other business would go bankrupt in a matter of weeks?
Do words like “Extortion” or “Monopoly” come to mind? This trade show blog is asking.



