Anyone familiar with international trade will surely know what a trade fair is: a bustling, crowded place, usually situated at the outskirts of big international cities, where small and medium enterprises show off their best products trying to find buyers for their target market.
On the other side is a swarm of distributors, intermediaries, potential partners and even competitors attending the exhibition as guests, looking for new products to bring to the market or simply to integrate into their supply chains.
How Does A Trade Fair Work?
The process is quite simple, even if the actual organization can be significantly tiresome.
It all starts with a company wanting to find distributors in a foreign country. Usually, the company is small- or medium-sized, i.e. not large enough to establish offices abroad directly, yet not so small that it has to go solely through an export agency, either.
First, since trade fairs are sector-specific, the company must find the trade fair that more pertains to its business. Second, it must purchase a stand at the exhibition. Third, it must send its own employees, plus a sample of the merchandise and promotion material, to attend the exhibition for as long as it takes (usually, from a minimum of two days to a maximum of a week).
The bulk of the posted employees are, of course, salespeople. They will stand next to the company’s purchased space, and, as visitors stop intrigued by the company’s products, they will promptly engage.
A few chats, an exchange of business cards, a handshake, and, voilà, the company has the contact of a potential buyer.
If the trade fair is successful, the salespeople will leave with a number of contacts, perhaps even a couple of advanced talks. If they are lucky, they might even get an order or two already.
This is the way in which the bulk of international trade has worked for more than a century.
Why Should The Trade Fair Be Dead?
As I said in the beginning, an exhibition is a crowded closed place, where people give a lot of talks to each other, many hands are shaken, and business cards exchanged. Of course, all of this is off-limits during a pandemic such as this one.
Covid-19 has brought massive disruption to the exhibition business. To have an idea, we can look at the data from Relx plc, the information giant that owns Reed Exhibitions, one of the largest trade fair organizers in the world employing 4,600 people.
In their half-year 2020 report, Relx said that only 15% of the planned exhibitions have taken place so far. 30% of the exhibitions have been cancelled, 5% rescheduled for 2021, and another 20% postponed to the second part of 2020.
In a note, however, the company states that there will be no guarantee that the rescheduled events will eventually take place, which shows the stress that the industry is going through.
International trade people might say that this is just temporary. That, as soon as the pandemic is over, things will be back at normal, even for trade fairs.
Yet, as for other businesses such as retail and education, there are deeper changes going on. Consumers are learning that shopping online is more convenient and cheaper. Students start to understand that they are not tied to their teachers; rather, they can purchase the best course online and study on their own.
Why shouldn’t businesses change the way they find buyers abroad, as well?
In the end, organizing a stand at an exhibition is a hassle. Unless you trust a local intermediary to take care of everything for you, you need to send people there prior to the event.
Moreover, trade fairs are expensive.
In Europe, the average cost for a stand is around EUR 175 per m², plus the cost of construction, which is another EUR 280 per m². Essentially, for a 20 m²-stand, a company will have to pay around EUR 9,000. But that is not over. Then there are promotion, marketing, staff, travel expenses, that would at least double the price the company pays for the stand alone.
Therefore, at a minimum, a trade fair in Europe will cost around EUR 20,000.
What Are The Alternatives?
As I wrote before, the pandemic is showing people that there are digital alternatives to what they were used to. That is also the case for trade fairs.
While still niche as a sector, there are several import-export online platforms where businesses can close deals anywhere in the world without the hassle of leaving their country, perhaps even without leaving the office!
Of course, you need to know where to look. Here are three good platforms focused on different continents:
Go4WorldBusiness: this is by far the best platform for finding a business partner in India. It started more than twenty years ago, grew with the dramatic rise of the Indian economy, and has recently expanded also to the Middle East and East Asia.
eWorldTrade: Headquartered in the United States, eWorldTrade has established a reputation as the platform of choice for the trade between the United States and China. If you want to source a supplier from North America or the Far East, look no further than here.
Global Souces: Based in Hong Kong and backed by private equity giant Blackstone, Global Sources is a massive marketplace focused on China and Hong Kong. Given the territory’s prominence in consumer technology, this website is a great place if you are looking for a supplier of electronics.
Enterprise Europe Network: This portal, backed by the European Commission, is the largest marketplace in Europe. Its pecularity is that businesses do not trade goods but build partnerships instead. If you aim at the European market with a long-term view, pay a visit here.