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April 16, 2008

VENUE WATCH UK:US economy hits key conference month

October maintains its traditional momentum as one of the key months for conferencing, but the USA economy is now having knock-on effects in the provinces when figures are compared year on year, according to Conference Care’s latest UK Conference Benchmark statistics.

Birmingham, Bristol and Leeds have experienced a drop in 24-hour accommodation rates, while the same goes for day delegate rates, which have also fallen in Glasgow compared with 2006. Meanwhile, although Manchester has seen a rise in 24-hour and day delegate rates, the increase is less than between 2005 and 2006.

In London, however, demand remains robust with day delegate rates increasing 11.86% from 2006 to 2007 and accommodation rates increasing 7.18% for the same period. Demand in the capital means conference organisers are in a ‘race for space’, namely venues are not holding provisional bookings, but demanding signed contracts from the outset.

Enquiry to confirmation rates

Overall enquiries resulting in confirmation have reduced slightly due to the difficulties of finding venues with available space. Clients are having to move the dates of their events to fit in with demand.
The race for space has become a common method of managing enquiry levels, as demand is so great in the peak season. The distinct lack of large venues and availability in the City means that event planners are planning further a field to secure space and rates.

For events up to 50 delegates, there is a growing emergence to use non-core meetings and events venues, which are now capitalising on the demand.

Lead times
High demand in October is reflected in much shorter lead times between enquiry and confirmation. However, the underlying trend is that confirmation to execution is down slightly on previous years due to UK economic factors.

Unsurprisingly, the lead in time for bookings in regional cities is shorter than London due to the fact there is more availability and clients are under less pressure to confirm.

Sector specific
The tumbling dollar, high oil and food prices, and a tight US labour market are keeping inflation fears at the top of the agenda. This is reflected in the association market, as well as many other sectors, by a slow down in rate rises as members put pressure on their association to deliver value for money.

The financial sector has seen a decrease in rates for three years consecutively, but the pharmaceutical market has seen rates even out, which Benchmark puts down to a reflection of ABPI legislation on the meetings and events.
The emergence of procurement in the buying process of meetings and events has had a knock on effect in all market segments, as purchasing departments seek to consolidate and benchmark expenditure.
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