A BVEP report has highlighted that in 2021, the loss of business could equate to £57bn of the £70bn pre-COVID-19 value of the events industry (i.e., a downturn of 81%). ¹
This means for a period of time, as the upturn of live events arrives, resource will continue to be in short supply, with the days of deals and discounting over, and prices rising.
Having worked through several downturns, the pattern is always the same: fewer suppliers try to service a greater demand. For almost two years following 9/11, it was a suppliers’ market. When we compare the current crisis to the one 18 years ago, this one is going to be deeper and harder to recover from, already having a huge negative effect on the events industry.
As we fully emerge from this, there just won’t be enough production companies and suppliers around to deal with the expected upturn. We know many major venues are saying they are constantly full as events were rescheduled from the spring to the winter and those from the summer to spring etc.
For several years we had a buyers’ market and now, following the departure of professionals and businesses from the industry during COVID-19 this has reversed with a shortage of resource, meaning prices will almost certainly rise. The limitations combined with inevitable inflation from Brexit means procurement departments will be powerless to manage the situation as rate cards go out of the window, and event services will be sold to the highest bidder.
So, what can client organisations do to ensure they get a fair deal and the services they require? First keep talking to your agency, make sure they are stable and not vulnerable to the crisis. Secondly, share your potential future plans for 2022 and 2023, however sketchy they are at present. Everyone is used to being back together at live events, nevertheless, we have some uncertain months that lay ahead into next year. So, consider hybrid as a safe solution for any events that require a contingency, because both live and virtual formats are already built into the planning so either can be fully leaned on at short notice.
The new market impacts everyone in the supply chain, and buyers should be knowledgeable in the lack of resource across the industry and understand the inevitable increase in their supplier costs. Lastly, time is of the essence here. If you can, reserve the services you need and lockdown the price now, don’t leave it until the last minute.
The suppliers need to ensure teams are aware and retrained in the change of market needs too, to understand their new positioning and to retain valuable talent. Respecting your employees time and efforts will go a long way, and this includes freelancers and third-party suppliers, the pool is smaller than before so by paying everyone on time and respecting their tireless efforts, they’ll return to maintain the cycle of work.
¹ The Tourism Recovery Plan – DCMS (June 2021) – p56
² Estimated economic impact of COVID-19 on Events UK - BVEP (2021)