Guest Post Written by Anna Huddleston, ECN Contributing Editor
When Nomadic Display, a Washington, D.C.-based portable and Modular Exhibit Producer, considered doubling the size of its rental facility in Las Vegas, the economy was struggling but still showing vital signs. The decision was based on pure numbers – the company reported 27 percent growth of its rental division in 2008 and it seemed only fit to follow the money.
Little did they know that just a few months later, when the facility was up and running, exhibitors’ budgets would be slashed and “rent” would become the new buzz word.
At a time when doing more with less has become a mantra, nobody is more affected than exhibit houses as they strive to deliver grabbing concepts on meager budgets. At the same time, many are discovering value-making opportunities buried in this downturn, and renting is certainly one of them. This might mean an entire mentality shift in the near future.
As technology gets more sophisticated, it gets easier to create custom exhibits and environments based on rented elements. It could be modular systems, custom-made structural elements, or audio-video equipment. The brand message is delivered at a fraction of the price. Plus, it’s green.
“Marketers tend to think that renting means black, black or black,” says Gwen Parsons, senior vice president of Nomadic Display. “But the truth is that rentals have come such a long way and they look seamless to visitors.”
The company noticed an increase in rental requests from end users and invested in a Web site that features a database of designs organized by size and budget. A customer fills out a request form, then a Nomadic project manager helps the customer blend the elements for a unique look. Depending on the location of the show, the customer also has a good chance of saving on shipping because the exhibit can be dispatched from Nomadic’s location in the show city.
In the case of the new Las Vegas office, Nomadic has gone a step further and now offers free delivery, Labor supervision and warehousing.
“A one-time rental cost can be as much as 25 to 30 percent of the purchase price for the same exhibit,” says Matt LaBruzza, vice president exhibition services with Nomadic, who also runs the Las Vegas facility. “The demand is increasing as companies realize that through a rental solution, they can realize both custom-tailored design and significant cost savings.”
Other companies across the industry are also turning to rentals as a viable option for their clients. Mary Levi of Chicago-based Ion Exhibits explains to her customers that current technology makes it possible for rentals to deliver brand identity and experience without incurring the cost of a new property. She then helps them decide whether renting is right for them.
“I advise them to rent if they are only going to one or two shows a year,” said Levi. “This way they have no worries about storage and transportation and we can also help them with Installation and dismantle.”
A new concern becomes investing in the inventory. Levi generally adds both the items that are in high demand (such as systems components) and also keeps an eye open for unique items that were custom-made for projects but can work elsewhere.
“We are always looking at the big picture and ways we can use the components effectively again and again,” continued Levi. “Just recently we added a double-decker and a new (exhibit system) configuration. This is definitely an area where we can make money now – a rent is a sale.”
The producers of systems and other often-rented elements also feel this shift towards great diversity, and opportunity extends even to those new to the U.S. market. Carl Devolder of Belgium-based Aluvision couldn’t get a breather at Exhibitor 2008, and the demand for his aluminum-based wall frames that can be used with tension fabric and lighting has been growing ever since.
“We have noticed that more and more American companies start rental divisions because end customers don’t want to take a risk of buying and prefer to rent the frames,” Devolder says.
Many of his customers are exhibit firms that traditionally work with plywood but are now looking to invest in items they can reuse.
“They can’t go on with ‘build and burn’,” he says. “After a few shows they get the initial cost back and from that moment, they make money on every new show.”
Jan Koren of Absolute Exhibits, a design and manufacturing firm with facilities in Southern California and Las Vegas, has been growing the company’s rental capabilities for the past several years and noted that just keeping the right stock and knowing how to sell it is not enough.
“I think the most important revelation we have had is that unless you are an all-inclusive exhibit house with an Installation and Dismantle contract and a specified system or systems for building, you can easily fail,” he said. “Being strictly a custom house in this tight budget economy is a very precarious place to be.”
Koren’s suggestion is to stay in the home city, build an Inventory that can be grown over time and get partners in other major destination. His company partners with DimensionCraft in Chicago and also does reciprocal work in New Orleans, Atlanta and Nashville on a smaller scale.
There is a two-way system for shipping exhibits and partners trust each other to supervise projects in their respective cities, which helps these smaller companies extend their geographical reach and grow their business
“We are always looking for partners – when you get a call for $50,000 rental in New York and half the shipping bill is Labor, it sucks the wind right out of you,” Koren says. “No one wants to lose a nice order, but unless you have five orders for the same show, costs are prohibitive. Again, most importantly (you have to) work with people you have confidence in and you will build your business by leaps and bounds.”
