Tom Shay’s e-ret@iler conversations

While this article from the Wall Street Journal is written from the aspect of a company exhibiting at a trade show, the logic is just as relevant for those attending a conference or trade show as a buyer or participant.

As I mention in our new presentation regarding the economy, every business has competitors that are making big mistakes during a challenging economy. Not being a part of a trade show means that the attendee is not seeing, hearing and learning what is the newest and latest within the industry.

A challenging economy ‘thins out the heard’. You don’t want to be a casualty because you failed to invest in learning what to do with your business. And by missing the trade show or conference, you won’t get to hear speakers such as myself providing you with business advise.

Trade shows can be worth the sometimes high expense. If, that, is, you’re smart about them.

By SARAH E. NEEDLEMAN

For small-business owners trying to navigate the economic downturn, spending money on trade and consumer shows might seem like a luxury better reserved for more prosperous times.

Not so, say many experts, who believe that exhibiting at—or at the very least attending—these events is one of the smartest things that a small-business owner can do, regardless of the state of the economy. Not only do exhibitions provide critical exposure to potential buyers, they also are essential for learning about unfamiliar markets, building personal relationships and getting an up-close look at the competition.

Conventions will always be one of the most valuable things you can do, says Andy Birol, owner of Birol Growth Consulting Inc., a business-coaching firm in Solon, Ohio. “There’s simply a consolidation of buyers in one place. They have money to spend and buying authority to exercise.”

Yes, exhibitions can be pricey. In addition to the cost of renting a booth or showroom space, exhibitors’ expenses typically include fees for shipping products and display materials. Many convention centers charge for drayage and access to resources such as electricity, phone lines and the Internet. Out-of-towners need to factor in transportation, lodging and dining expenses.

Such costs, combined with the bad economy, are leading some exhibitors to pull back. A recent survey of 240 corporate exhibitors found the number of conventions and trade shows they plan to participate in this year will decrease on average to 26 from 31 in 2008, reports Tradeshow Week magazine.

But that can be good news for small businesses, which are likely to see less competition at the shows this year. Plus, there are ways to minimize some of the costs that shows bring—and avoid others altogether.

Pick Your Battles

First, do some research to find out which shows are likely to offer the best prospects. Review sales figures from events you have attended in the past, including transactions that resulted from leads you obtained, recommends Jayme Broudy, founder of Contractor’s Business School LLC, an advisory firm in San Luis Obispo, Calif.

For new events, ask the registrars what kind of crowds they normally attract and how many of the attendees are actually buyers. Also request referrals to past exhibitors and buyers from within your industry and ask them about their experiences.

In general, if you must choose between an industry or a consumer show, Mr. Birol recommends targeting industry. Consumers are unlikely to spend big money in this economy, he says, and many go to shows just to have fun. For example, people who attend Comic Con, a comics convention held annually in New York and San Diego, commonly go there just to get artists’ autographs or to dress up like their favorite characters.

Once you know which shows you want to attend, consider offering to split the cost of an exhibit space with another firm in a different market. In January, toy distributor Rocket USA Inc. of Forest Park, Ill., partnered with a jewelry company to rent a showroom for a year at an Atlanta convention center. For $14,000, or half the total bill, Rocket USA will be able to exhibit at four shows and use the space for client meetings at any time during the year, says Cesar Vargas, vice president.

The discount on the yearlong lease, in addition to the partnership, resulted in a significant savings for Rocket USA, which Mr. Vargas says would have had to pay about $13,000 per show to rent its own booth. And the company will only have to pay to ship its display materials once each way for all four events, resulting in additional savings.

Mr. Vargas says that he connected with one of the jewelry firm’s executives at a gift-shop industry-association meeting. He suggests contacting trade associations, small-business groups and other organizations that cater to entrepreneurs and using networking sites such as LinkedIn.com to get the word out that you want to share a space.

When it comes to outfitting your booth, consider used display materials, says Aaron Rasmussen, co-founder of Harcos LLC, Santa Monica, Calif., the maker of Mana Energy Potion, an energy drink for gamers. In September, he spent $950 on a used backdrop that normally sells for $1,100 new. “Some companies buy them, use them once and return them,” he says.

He also recommends buying furniture for your booth from a discount store such as Ikea instead of renting it from the show operator. Not only are you likely to spend less, but you’ll be able to use whatever you buy more than once, he says. And be creative. At a trade show last year, Rocket USA displayed its products on the boxes it used to ship the items to the event.

Exhibiting isn’t the only way to find buyers at shows. You could skip the event and host get-togethers in a nearby hotel suite, says Mr. Birol. Many shows list registered attendees on their Web sites and in marketing materials in advance. Promote the opportunity as a chance to break from the noise and stress of the show and sit down in a private, relaxed environment, advises Mr. Birol. If you plan to introduce buyers to a new product or service, describe the meeting as a sneak preview.

Lend Your Voice

If your company sells services rather than products, offering to be a guest speaker at an exhibition is another effective way to win the attention of potential buyers without having to incur steep expenses related to exhibiting. You might even get paid for lending your voice.

Rebecca Morgan, president of Cleveland-based Fulcrum ConsultingWorks Inc., regularly speaks at industry events, earning about $1,000 to $5,000 per engagement. “My business is all about having credibility and being respected by people who are authorized to spend money,” says Ms. Morgan, whose firm advises companies about how to improve their operations. She adds that buyers often approach her about her services after she’s done speaking.

Before landing paid speaking gigs, you may need to get some experience doing it at no charge. Ms. Morgan recommends volunteering to speak at events hosted by local groups. Also, many shows line up speakers months in advance, so be sure to express your interest early on, she says.

As a last resort, you can always just walk the floors of an exhibition and introduce yourself to buyers. Also be sure to bring some product that you can give away to “anyone with a camera or microphone,” says Mr. Rasmussen. At a comic-book industry convention earlier this year, Mr. Rasmussen handed a sample of his company’s energy drink to video producers for The Review Zoo, an entertainment Web site. The crew responded with an on-the-spot interview request, and he happily obliged.

One final caveat: If your only goal is to be seen by your competitors, don’t bother attending a show at all, asserts Mr. Birol. “If you didn’t go, it used to be that the rumor mill would circulate and suggest that you’re not doing well,” he says. Today, this is no longer the case, because most businesses have a constant presence online, he explains.

George Whalin is one of the great minds in retail. In this audio blog conversation George gives his outlook on the retail economy, some suggestions for small business, and announces his new book.

George's website is http://www.georgewhalin.com/
And the website for the new book by George is http://www.retailsuperstars.com/

In the presentation I wrote, “Little things to do to make ‘09 turn out fine”, this is one of the aspects we discuss; a retreating competition can open up many opportunities for your business to grow. There is a reason why ‘Recession’ and ‘Rear View Mirror’ both start with the letter ‘R’;  they are for people that look at their business that way. There is a wonderful view when you look through the windshield.

When retailers go out of business, it confuses shoppers but creates opportunities for the competition.

And when it’s tough for any retailer to survive, any way to find additional customers is a good one. So more stores are increasing efforts to attract customers of struggling rivals.

Staples responded to Office Depot’s decision to close 112 underperforming stores by sending e-mail that said in part, “We invented the office superstore in 1986 and we aren’t going anywhere. And remember, when other suppliers are closing their doors we’re here to stay.”

Electronics and appliance retailer hhgregg has twice extended a promotion in which it allows shoppers with Circuit City gift cards to apply them toward 20 percent of their hhgregg purchase.

Hhgregg spokesman Jeff Pearson said the promotion is more about trying to attract new customers and less about hurting a competitor that is already in bankruptcy.

“We are certainly trying to be sensitive to the business environment that all retailers are under, and we are wanting to see more customers,” he said. “It’s similar to a marketing event where [we offer] a percent off. It’s really an opportunity to have customers experience hhgregg.”

This type of strategy is common, said retail analyst Britt Beemer, of America’s Research Group in Charleston, S.C.

When the Sharper Image filed for bankruptcy and closed its stores earlier this year, its competitor Brookstone offered to accept then-worthless Sharper Image gift cards for a 25 percent discount. It’s something Beemer called prudent marketing.

“You’re not kicking the guy while they’re down,” he said. “You’re taking care of their customers. When they file bankruptcy, all you’re doing is assuming responsibility and you’re taking care of their customer when they’re going to go out of business soon.”

Shoppers should expect to see more of these promotions in 2009.

The International Council of Shopping Centers estimated that 148,000 stores will close in 2008, the largest number since 2001. The council also said 73,000 stores will close in the first half of 2009 as the recession drags on.

But current financial conditions may prevent some companies from fully taking advantage of these opportunities.

In late November, Best Buy reported third-quarter profits down 77 percent and announced a voluntary buyout program for employees.

That makes the company hesitant to spend lots of money on anything right now — even though there’s a golden opportunity with one of its biggest competitors, Circuit City, filing for bankruptcy and closing stores.

“We believe that the environment for consumer spending is likely to get worse before it gets better,” said Best Buy CEO Brad Anderson. “In fact, we can foresee a period in which consumers may significantly shift their spending behaviors, which could have a dramatic impact on retailing.”

Steve Drake is the owner and CEO of Drake & Company, an association management company headquartered in the St. Louis area. In this visit, we talk about how Steve created the 'Trees for Troops' program, a 'Cause Marketing' campaign that has provided 50,000 Christmas trees to active duty military members. Steve explains how the concept of the program can be adapted by other associations and businesses to produce the 'three P's'.

Speaking this weekend for the Southwest College Bookstore Association in Fort Worth, here is an article appearing in today’s Dallas newspaper talking about the amount of INCREASE of anticipated sales for the holiday 2009 season.

The National Retail Federation’s annual shopper survey to be released this morning said that Americans plan to increase spending by a “paltry 1.9 percent” over last year. It also indicated that price will be the biggest force behind purchasing decisions.

The survey follows the Commerce Department’s report Wednesday that September U.S. retail sales fell 1.2 percent, confirming the weak September sales that individual chains reported last week. The decline was almost double the 0.7 percent drop analysts expected from consumers, whose spending represents two-thirds of U.S. economic activity.

According to the trade association’s 2008 Holiday Consumer Intentions and Actions Survey, conducted by BIGresearch, Americans plan to spend an average of $832.36 on holiday-related shopping vs. $816.69 last year. That’s the smallest increase in planned consumer spending since the survey began in 2002.

The industry’s largest trade group may change its forecast to a 2.2 percent rise in the November-December period.

“It’s a possibility. We want to see if the volatility in the stock market dies down, and we want to get past the election to see if consumer confidence changes,” said Ellen Davis, federation vice president.

According to the survey, 40 percent of shoppers said sales and promotions are the biggest factor for where they shop, and 12.6 percent said everyday low prices are most important.

Young adults, ages 18-24, are pulling back their spending the most. Members of the highly sought-after demographic plan to spend 12.2 percent less than last year, according to the survey. “That will be disconcerting for so many retailers going after that group,” Ms. Davis said.

Still, retailers are going into this holiday season “with their eyes wide open, knowing that savings and promotions will be the main incentive for shoppers,” said federation president and chief executive Tracy Mullin. “No one is canceling Christmas because money is tight, but consumers will be sticking to their budgets and looking for good deals.”

As to where consumers will shop, 69.7 percent said discount stores, and more than half of adults, 58 percent, said they plan to shop at department stores.

One-third of gift buying, or 33.6 percent, will be influenced by the Internet, shoppers said, meaning they will either buy or research products online, up from 30.2 percent last year.

The Hot Dog Professor

Practical business tips from Mark Reitman, the founder of Hot Dog University in Milwaukee, include choosing the right soundtrack

by Francesca Di Meglio of Business Week

Do you need a degree to run a hot dog cart? Mark Reitman, the founder of Hot Dog University in Milwaukee, thinks so. For $300, the former elementary school teacher and guidance counselor with a fondness for Chicago-style dogs, offers aspiring vendors a hands-on, two-day course on the ins and outs of the mobile food business. Six to eight students at a time participate in a course, and Reitman, who launched the business in June, 2006, says it is profitable and plans to expand it.

On the first day of the program, participants learn the basics in a classroom setting—from getting the right licenses to finding a prime location. On the second day, Reitman brings the class into the field to run a cart and sell dogs themselves. He bases his coursework on his three years of experience moonlighting as a vendor at a mall in Wisconsin. (The opening of the mall’s food court prompted him to try his hand at instruction.)

The beauty of the course, say graduates, resides in its affordability, lessons in the basics of the hot dog business, and tips that are applicable to other food businesses. Former students such as Dan Council, who plans to forgo traditional retirement to sell hot dogs to fishermen from his boat on Lake Wisconsin, credit Reitman with helping them build a foundation for a successful business.

A few tips from Reitman, the self-proclaimed PhD and professor of hot dogs, follow:

Find a prime location.. Pick a spot with few competitors, plenty of foot traffic, and zoning that allows you to sell your products without cumbersome restrictions.

Keep your menu simple. Whether you are running a food business or a store, you want to avoid bringing in a large inventory that may not sell. The simpler your offerings, the less complicated and less costly it will be to run your business. For example, Brad Bailey and Paul Frautschi, both recent HDU graduates, originally offered dozens of items on their menu, but say customers were overwhelmed by the choices. Now the duo, which runs Mad Dogs in Madison, Wis., offers only the basics and expects to make a profit in 2008.

Find ways to advertise for free. A proponent of providing authentic, high-quality products, Reitman wants his students to make sure clients know how good the hot dogs they’re selling really are. One way he suggests doing that is by using free materials from vendors. For example, if you’re selling Nathan’s dogs, then you could put a Nathan’s umbrella and sign on your cart. This way, customers will associate your cart with an already established brand’s hot dogs.

Put on a good show. Having a hot dog cart or stand is not the same as owning a gourmet restaurant. But it is still a service business. “You’re on stage when you’re running a hot dog stand,” says Bailey. “You have to have a personality or people won’t come back.” He adds that if you’re generally unhappy, then the food service industry is not for you.

Appeal to the senses. A major focus of Hot Dog University is having students pick up marketing tricks. Reitman covers how hot dog vendors must. The logos and brand colors on the cart’s signage draw attention through sight. To appeal to one’s sense of smell, Reitman suggests grilling onions on the cart. For sound, he has students play what he calls “happy-feet music,” anything that gets toes tapping and makes waiting in line seem more pleasurable. This, in turn, helps lure people again with sight. “It’s a mob mentality,” says Reitman. “If you see a lot of people in line, you think it must be good.”

Of course, a customer’s sense of taste is also crucial. One trick Council used to introduce those in his small town of Lodi, Wis., to Chicago-style dogs was to give them away at first. He was confident if they tasted the product, they would be hooked and would return as paying customers.

Pay attention to industry trends. Even if you’re launching or maintaining a side business, you can still uncover new revenue streams. Reitman notes that there is a demand for carts at seemingly unlikely events such as weddings.