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xhibition organisers do still have a choice of shell and electrics contractors today, but organisers are in no doubt of the shrinking pool of options. In light of the merger of Stanco/Opex and Early Action Group (EAG) into the SO Group, organisers participating in Zing's survey who wanted full-service delivery from a single supplier felt they had lost a third contender and now only had two options in the marketplace: Melville and SO Group. As a result, contractors underneath the top two players have failed to secure a position as a viable third option.Not surprisingly, Melville received the highest market awareness score of 88 per cent, followed by the former Stanco (83 per cent), Opex (60 per cent) and EAG (50 per cent). The report included SO Group and its former parts as it was important to look at awareness and usage of the separate RESEARCH24 www.exhibitionnews.co.ukcompanies in context alongside the consolidated group. Zing found awareness of the new branding was still low. Many respondents also referred to their supplier using the old names and were still dealing with the same people they did pre-merger.According to Zing, the extreme weighting towards the two largest players is due to a belief that smaller contractors can't provide the infrastructure, scale or back-offi ce support necessary to support shows. When asked which shell and electrics contractors they had ever worked with, 73 per cent of respondents said Melville, and 68 per cent went with SO Group and its historic component companies. The gap between the third most used contractor, Joe Manby, was signifi cant: Just 17 per cent said they had used the Harrogate-based player, and interviews suggested Joe Manby wasn't necessarily considered an option away from the Harrogate International Centre. Rounding off the list were Achieving a partnership that works for both sides means that organisers are taking some responsibility for maintaining contractor marginsHirex (used by 11 per cent of organisers), Showlite and Dimension 8 (9 per cent apiece), The Index Group and Anchor Exhibitions (8 per cent apiece).Organisers also showed a preference for the top two as their primary contractors: 41 per cent of organisers said they used Melville as their main contractor, while 33 per cent used the combined SO Group. Just 13 per cent of those surveyed claimed not to use a main contractor. Zing Insights director Joe Walther compared the SO Group/Melville duopoly to the brand dominance of Coca-Cola and Pepsi in the soft drinks market."Melville could be considered Coke to SO Group's Pepsi," she claimed. "People have a favourite and they pretty much stick with it. Unless Melville or SO Group do something dramatically wrong, that's unlikely to change very much." It's not impossible, however. Walther pointed to Coca Cola's 1985 New Coke launch as an example of a major marketing failure which threatened to turn loyal consumers away from the brand.MARGIN SQUEEZEA popular explanation for consolidation in the contractor sector has been the recession. Less money spent being spent on shows by organisers, exhibitors and visitors, combined with rising energy charges, forced everyone to cut their costs and fi nd more value for money. It was the COMPETITIVE LANDSCAPE010203040506070809010088836050453528242523211673643425171188311199Contractor usage Contractor awarenessMELVILLESTANCOOPEXEARLY ACTION GROUPSO GROUPJOE MANBYSHOWLITEHIREXDIMENSION 8MOYNE EXHIBITIONSTHE INDEX GROUPANCHOR EXHIBITIONSleft: UK organiser awareness of shell and electrics contractors including the former companies that make up the SO Group, and the percentage of organisers using each for one or more exhibitionsECONTRACTOR AWARENESS VERSUS USAGEIn this excerpt from Zing's research, we look at perceptions of UK contractors and their services, how organisers choose suppliers and the future needs of both

researchwww.exhibitionnews.co.uk 25contractors at the end of the chain that bore the brunt of the downturn. The enhancement and maturity of shell scheme thanks to developments like Octanorm's reusable aluminium system have also commoditised some of the services traditionally provided by a skilled exhibition contractor. Organisers participating in Zing's qualitative research said they recognised contractor margin decline over recent years was largely due to taking a commodity approach to purchasing. They took the blame for pushing contractors to reduce costs and admitted a significant proportion of the recession 'hit' had been taken by their suppliers. "I think [contractors'] margins must have declined otherwise we wouldn't have had the consolidation we've had," one respondent said. Another admitted organisers had been 'beating' down contractors on price, and they were giving in, resulting in scratched and badly maintained kit. "I don't feel like I have a responsibility for contractor margins but I don't feel like you should screw them," said another organiser. "They should be treated more like partners than someone you can just get cheap kit from." The majority of organisers surveyed also stressed the importance of contractor relationships in event delivery. "Achieving a partnership that works for both sides means that organisers are taking some responsibility for maintaining contractor margins, in most cases because they feel that reduced margins can lead to reduced quality delivery," Zing stated in its report. Sixty-four per cent of respondents to the survey said the cost of shell and electrics services had increased over the past five years. An increase in more sophisticated solutions were also opening up some avenues for improved margins. "Venue costs have remained high, whereas the contractors were amenable to helping us through a difficult time," one respondent said. "During the recession, a lot of contractors froze their prices and for the last three years it has stayed static, whereas with the venues, a lot of prices have gone up."However, the antagonism between contractors and organisers was still prevalent when discussing margins."I'm always of the view that you don't screw down your supplier but at the same time you don't want them creaming off too much money because you've got to make money as well," one respondent said. "I don't care, it's not my business. Do they offer me the right service? Can they deliver? Whether they make a million or £0.05 is irrelevant to me," said another.Supplier conSiderationSWhat is perhaps surprising is that price isn't always the sole thing organisers focus on. Although pricing has often been seen as the overriding factor in how organisers choose their suppliers, Zing found quality of service actually pipped cost at the top of the list of decision-making criteria. Following service quality and price was the quality of stock and people and skills. To a lesser but still important extent were flexibility, organisational stability, reputation and quantity of stock. The least significant criteria reported by organisers was the size of a contractor's business and their physical location. Nevertheless, market consolidation and the recession have led to a more cautious approach. Organisers touted credit checks, financial security and contractors with sufficient organisational infrastructure and back-office support as musts. In As part of its qualitative research, Zing asked organisers to provide in-depth comments on how they dealt with contractors and what impact consolidation was having on those relationships. Here are some of their responses."We're careful when we're negotiating our contracts with the contractor to actually set the figures for the fees that our exhibitors are expected to pay. While we appreciate that if we're paying less contractors have to claw back the figures somewhere, we're also quite mindful that we don't want to upset our exhibitors.""My view is that the industry has become fixated with the cost of shell scheme when most contractors are offering a lot more sophisticated solutions. We have focused on the wrong thing. It has become an obsession and we are not getting the best relationship as it has become 'how much per square metre?'.""With the smaller contractors, it disappoints me that they're not upping their game and shouting about how good they are and what they can do. Now is the time for them to present to the industry what good companies they are."organiser feedback