Crain's Uncovers How Contractors & Trade Associations Squeeze McCormick Place Exhibitors
- Published: June 13, 2011, By By Yolanda Simonsis, Associate Publisher/Editor
CHICAGO, IL | Early in my marriage, my mother-in-law always told me there are three sides to every story. Finally, the THIRD SIDE OF THE STORY is revealed in Crain’s Chicago Business with a story by James Yisela Jr. dated today June 13.
The story reveals how private show contractors GES (Global Experience Specialists Inc.) and Freeman along with individual trade associations responsible for organizing the trade shows hosted at Chicago’s McCormick Place have squeezed “exhibitors, who already bear most of the costs of convention.”
“At the same time,” reports Yisella after three months of investigation for the article, “contractors reward the trade associations by covering some of their direct costs, then passing those costs on to exhibitors through higher prices for a range of services. Crain's also finds that trade associations pad their profits by substantially marking up what exhibitors pay for floor space and hotel rooms controlled by the associations.”
Among the revealing, tantalizing tidbits of information, Yisella reports the following:
• Both Freeman and GES do not itemize their drayage bills, where thousands of dollars are frequently spent.
• Did you know that McCormick Place leases floor space to the associations at $1.30 to $1.80 per sq ft? “But the sponsoring trade associations charge exhibitors $20 to $40 per sq ft. A show with 300,000 sq ft of exhibitor space would pay McCormick Place up to $540,000 but collect $12 million from exhibitors—a better-than-2,000% markup.”
• GES and Freeman have lead exhibitors to believe they have no other choice but to use only them for their electrical work. Last year, Focus One (now known as ETS or Exhibitor and Technical Services) was legislated to provide its services at cost. However, both GES and Freeman have mislead exhibitors to think ETS was not an option.
Look at the article on Crain’s website It’s an eye opener!
