There is a saying in Mexico; “When the United States gets the flu, Mexico gets pneumonia.” This long-standing belief exemplifies how entwined Mexico’s economic health is to that of its northern neighbor. The same could be said about Mexico’s exposition industry; however, there are signs that Mexico’s exposition industry may be rebounding faster than its American counterpart is.
A recent report by Grant Thornton International states that “the future looks bright for the world’s emerging economies” and ranks Mexico fourth on its list of emerging economies behind mainland China, India and Russia. In addition, Mexico’s Deputy Minister Alejandro Werner stated in February that the Mexican government was raising its estimate for 2010’s economic growth to 3.9 percent compared to its previous forecast of 3 percent. JPMorgan Chase and Co. is also bullish on Mexico. Last month, it raised its 2010 economic growth forecast for Mexico from 3.5 percent to 4.5 percent, citing an increase in manufacturing and improvement in domestic demand.
Headquartered in the United Kingdom, with offices in Mexico, Grant Thornton International (www.gti.org) is one of the world’s leading organizations of independently owned and managed accounting and consulting firms. JPMorgan Chase and Co. (www.jpmorganchase.com) is a leading global financial services firm with operations in more than 60 countries.
“The importance of the emerging markets to the world economy has been brought into sharper focus as the world emerges from recession,” said Alex MacBeath, global leader, markets for Grant Thornton International. “Not only have these economies been less severely hit, but they are also recovering more quickly, with growth rates over the next two years forecast to be double that of more mature economies (such as the United States).”
“The tradeshow industry as a whole in Mexico is doing very well,” said Steve Ianuzzi, managing member of MFV Expositions. “In fact, our business has been growing despite the down economy. A growing trend in Mexico is the expansion of public conferences and expositions. These public events are hybrid information and entertainment events and these ‘info-tainment’ events are extremely popular in Mexico.”
Headquartered in Paramus, N.J., Ianuzzi says MFV Expositions (www.mfvexpo.com) produces franchise events worldwide, including three in Mexico – Monterrey, Mexico City and Guadalajara. It also produces shows for other organizers across Mexico.
MFV’s three largest Mexican shows are:
* FIFE (franchising show), World Trade Center, Mexico City, 37,000 attendees and 350 exhibitors covering 10,000 square meters of exhibit space
* Expo Hecho En Alemania (Made in Germany), World Trade Center, Mexico City, more than 100,000 attendees, 100 exhibitors covering 20,000 square meters
* Expo CDC Centro De Consumo (night club and bar expo), Banamex Convention Center, Mexico City, 15,000 attendees, 200 exhibitors covering 10,000 square meters
“We also do events in cooperation with the Mexican Federal Government which sponsors events in the franchising sector,” Ianuzzi said. “The Federal government is tethered to the industry. It realizes that small businesses are the employment engine in Mexico, therefore it is extremely interested in providing subsidies to help grow the sector.”
A veteran of Mexico’s exposition industry, Patricia Farias Barlow, CEM, said although different companies and organizations have weathered the economic downturn in different ways, overall, the Mexican tradeshow industry in Mexico is“mostly” stable. And Barlow should know. She is president and CEO of Farias Global Expos/Messe Dusseldorf AV Mexico (www.fariasglobalexpos.com), a tradeshow industry consulting company with offices in the United States, Mexico City and Guadalajara She is also a former chairman of International Association for Exposition Management. In 2004, Trade Show Week listed her among its “25 Women to Know,” and again recognized her in 2005 among its listing of “Global Movers and Shakers.”
“As in any crisis, there are professional organizers that grow and adjust and the less professional companies disappear,” Barlow said. “There are some shows that have experienced up to a 25 percent growth, others are flat and some are down. Today, organizers have had to be more creative and flexible with their payment plans and are having to bundle more services to help exhibitors through the slump created, not only by the world economic recession, but also from the H1N1 (swine) flu crisis.”
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Barlow added that news reports on Mexico’s escalating drug-war violence also hurt Mexico’s tourist and exposition industries last year and is likely still suppressing international exhibitors’ enthusiasm for participating in Mexican conventions and expositions.
“There have been losses in the number of American exhibitors due to the economic recession but, also, because of the bad image Mexico has at this moment in relation to safety and security issues,” she said. “It is important to note, that this violence is concentrated only in some cities and mostly along the U.S. border and not the rest of the country.” (See accompanying article: Safety Precautions Imperative when Traveling in Mexico.)
She is, however, optimistic about the short-term outlook of her industry saying that Mexico’s convention and exposition industries are growing rapidly as the industry works toward being more professional. More individuals are seeking industry-specific professional designations and education and many Mexican states are building or expanding convention and exhibition centers. One challenge the industry is facing, however, is a lack of industry-specific trained personnel.
Ianuzzi agrees that educated and motivated industry professionals are key to industry expansion. He went as far as to say that his company’s success is largely due to his Mexican company being a wholly owned subsidiary and 100 percent staffed by college-educated Mexican nationals.
“The tradeshow industry in Mexico is radically different than in the U.S.,” Ianuzzi said. “American exposition management companies should not try and run American expositions in Mexico from America. If you want do business in Mexico, then you need to be in Mexico and invest in hiring local professionals. There is a long list of companies that have attempted to rebrand icon brand names (tradeshows) in Mexico and failed miserably. On the other hand, the local companies are prospering.”
Mike Boone, international business director for Coastal International, agreed whole-heartedly there are numerous barriers to doing business in Mexico, specifically language barriers and how shows are run in Mexico, but, he to, is optimistic that Mexico’s tradeshow industry is on the rebound.
With its headquarters in Sausalito, Calif., Coastal International (coastalintl.com) is a U.S.-wide provider of installation and dismantling services that also provides support to client exhibit houses in Mexico.
“Things are looking good in Mexico,” he said. “There are more projects going on, shows seem to be busier and everybody in the industry seems to be much more positive and hopeful. As long as no more pandemics come along, and the military continues its efforts to squash the drug wars, the Mexican economy and tradeshow industry should continue to recover.”
Despite the challenges, all three of the professionals interviewed for this article agree that there are numerous investment opportunities as well as show launch opportunities still available in Mexico.
“For exhibitors, it is a market with tremendous growth potential and it is just across the border,” Barlow said. “With all the trade treaties in place, you can’t lose as long as you do your research properly.”
Aleta Walther is a marketing communications professional and freelance writer with several years experience as a corporate exhibit manager. Contact Aleta at aw@waltherstewart.com.
