Price Hikes: Out of Season

With the good that comes from a rebounding economy also comes a dose of the not-so-good: The annual core inflation rate jumped from 1.1 percent in January to 1.6 percent in March, an increase of 45.5 percent. What's more, that core measurement does not include the even more rapidly rising costs in food and fuel—two items closely linked with the business of show management.

So as other industries are starting to see their suppliers raise prices by 2 to 4 percent, are event managers seeing rising costs? Not just yet, say experts.

"For this year, shows are mostly locked into their contract terms, so you won't see an immediate cost change or pricing reaction at most shows," says Michael Bandy, president of Chicago-based Trade Show Exhibitors Association. "Besides, there is still a lot of sentiment I'm hearing at exhibitor forums about controlling costs," including the use of lightweight hardware to minimize freight charges. "We're seeing that shows in some sectors have just started posting increases in attendance, but I don't think the show industry has come back to such a strength that you will see price-increase trends applied to us anytime soon."

Steven Hacker, president of Dallas-based International Association for Exhibition Management, agrees that "end users have said they're not going to pay higher costs anytime soon." But he disputes the assertion that shows in most industries have yet to recover. "The many sectors of the economy that are doing well have corresponding trade shows that are setting records for attendance and exhibit sales. The sectors that are not doing well have smaller audiences, but the quality of the audience is high."

Both Bandy and Hacker agree that any rise in prices must be accompanied by added value. Says Hacker: "Exhibitors must be put into contact with enough quality buyers to feel satisfied that the show was worth additional expense."