Clients are currently preferring to postpone events rather than cancel according to the majority of those who attended micebook’s emergency event industry leaders’ summit on the coronavirus crisis.
Micebook hosted the emergency meeting for event industry leaders at The Biltmore Mayfair on Wednesday 11 March to discuss the impact of the crisis.
Chetan Shah, Micebook CEO and founder said: "More than 30 senior industry leaders including MDs and senior representatives from agencies both large and small, representatives for several industry associations, several hotel/venue representatives, and experts in crisis management and travel law attended. While everyone in the room was optimistic that the industry will survive this crisis, just as we survived 9/11 and the global financial crisis of 2007-8, there is no doubt that the next few weeks and months are going to be incredibly challenging."
Shah also shared some of the key discussion points/takeaways:
Postponements
*Agencies were warned to be careful about how optimistic they are about those postponements actually happening. Are we delaying an inevitable loss and not taking the right precautions now? Events that are being moved to later in the year may end up being postponed again or cancelled so you need to factor that into your business contingency planning.
*Availability of team/venue – if all events are being moved to September onwards, that is already one of the busiest times in the events calendar so there is no guarantee you will be able to get the same venue or even guarantee the same team for the client so you need be prepared for that, and for how you will manage workload when business picks up.
*One suggestion was to push business into 2021 instead. One agency said they took the decision with one client to postpone all events for Q1 and Q2 and renegotiate with suppliers on the client’s behalf to move it the first half of next year. The agency didn’t charge for doing this and did it as a goodwill gesture, and while they have taken a financial hit in the immediate term, they have guaranteed that work for next year.
Agency leaders discussed what to do if clients postpone or cancel at the summit*Some venues view postponements the same as cancellations so agencies are spending a lot of time renegotiating with venues to agree to postpone and reduce the liability.
*Agencies should try to get clients to commit to a date later in the year to postpone the event to and the hotel industry can help with that by putting coronavirus clauses into their contracts and reducing liability so we can get some confidence back.
*Should agencies charge clients additional fees for postponed events as a lot of the work will need to be repeated?
Cancellations
*Is cancellation because of the coronavirus force majeure or not? Clients and agencies need to look closely at their contracts and cancellation and insurance policies to see what they are covered for. It all depends on the individual contracts and supplier agreements. If pandemics are not named in your contract, then you may not be covered in the force majeure clause.
*If the client cancels – it is up to them to deal with whatever loss they suffer from their own insurance companies.
*One agency head said that some clients are asking the agency to waive fees. “Our position is that we can’t waive fees, and payment terms as well – we shouldn’t be relaxing those either despite pressure as we need to protect our business.”
*What happens if the government decides to cancel events over a certain size? How will that impact cancellation policies? Our law expert said that the answers are always in the contracts.
*Lots of hotels refuse to pay commission on cancelled events. If you are working on a pure venue-find basis that is a huge loss of revenue. What can venue find companies do to protect themselves? Can venues and hotels support them somehow?
*Many hotels and venues are now putting in place coronavirus clauses for any new business booked.
Alternative options
*Agencies need to keep talking to clients and offering alternative solutions where possible. We discussed what alternatives agencies are offering, with the most obvious options being digital solutions such as webinars, streaming and virtual events. Of the 10 agencies we polled, four had already swapped a live programme for a digital solution while others said they had clients considering alternative options.
Other alternatives that have been offered include:
*Hosting an event at a clients’ office instead of an external venue to minimise risk.
*Organising an event in small groups of 25 per office to limit exposure as opposed to bringing people from multiple offices together.
*Move overseas events to UK events. There are some good rates to be had on venues at short notice.
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M&IT editor Paul Harvey is a journalist with more than 15 years of experience. He began his career in the local press, working for various titles across the north. Since joining M&IT in 2013, he has become a trusted and respected voice in the sector, championing event professionals and reporting on all aspects of the events industry for the brand.
