From the pages of Produce Business UK

By Jim Prevor, editor-in-chief of Produce Business magazine

Flying home from Fruit Logistica, the largest produce event in the world, I pondered the question I am sometimes asked: Which is “better” — the larger or the more intimate events? To me, it is an odd question, because both offer opportunities for the willing.

We launched Produce Business magazine at the Produce Marketing Association event back in 1985 — because it was the biggest produce event in America.  But I made excellent contacts and built wonderful relationships attending intimate PMA board meetings for many years.

In general, the industry “under markets.” This is true to consumers; it is true to the trade. And when it comes to trade shows, it is worth looking at why the industry, companies and organizations large and small have trouble recognizing the return they get on their investment.

The problem starts with budgeting. Internally, most companies must allocate expenses for booths or sponsorships to a particular division. Although theoretically different divisions could chip in and split the costs, the practicalities of doing this are often difficult. This leads to a very narrow definition of success.

Sometimes the expense is narrowed by geography. Companies very often expect that an event will be paid for by a subsidiary based on geography, so a Dutch subsidiary might be expected to pay for an event in the Netherlands. Or a regional office in New York metro might be expected to pay for a New York event.

Yet, in a global world this doesn’t correspond to the way business is done. So, let us say a global conglomerate exhibits in London. Its Peruvian subsidiary is part of the display, and a big buyer from China becomes a big customer — buying millions every year. You would say it is a triumph, right? Actually, if that is all that happens, the company may still cancel its booth next year! Why? Simple: The subsidiary that is paying for the stand is the UK company, but the profits from the China transaction are going to the Peruvian company. So, if the team in the UK is incented based on its bottom line, it would be wise to cancel the spend even if the overall corporation loses out on enormous amounts of profitable business.

Sometimes the issue is division by business classification. Many companies are organised with different divisions ... say, one to sell retail, another foodservice, another wholesale. Sometimes they are divided by product, with separate divisions focused on berries or potatoes and onions, etc. Again, few companies are organized in such a way that these disparate divisions can market smoothly together.

So, typically, one division spearheads a purchase. If the retail division is paying for the booth, the fact that a big foodservice operator or distributor made a very profitable deal with the foodservice division may not count at all. If the sourcing division saves a quarter million a year on doing visits to producers by having a booth, in many companies that savings doesn’t get calculated at all.

Then there are the myriad ways being at trade shows and industry events can lead to positive outcomes, but, again, not in a way the division paying for the booth will recognise. We’ve seen executives meet people at their booths and then lease out unused warehouse or office space, in some cases on multi-year agreements worth millions. But the benefit of doing that is rarely attributed to the division that bought a booth! 

There are plenty of acquisitions, joint ventures and similar cooperations that grow out of engagement with industry events — yet, again, the corporate mechanism for assigning value to these things is almost non-existent.

Many times, we have seen people hiring visitors they met at the stands. We’ve been thanked for introducing them to the person who became their top salesperson — a contribution to a company worth millions over years — but that is HR, not the retail division, that benefited from the booth! In fact, there are plenty of acquisitions, joint ventures and similar cooperations that grow out of engagement with industry events — yet, again, the corporate mechanism for assigning value to these things is almost non-existent.

Because everything is so siloed, even those who do participate don’t get as much value as they could. In Berlin, I was walking with the most senior produce executive at a top 5 US retailer — a man in control of billions in procurement dollars. We walked through the booth of one of the top five produce companies in the world, and nobody knew who my pal was! The exhibitor didn’t bring any Americans and didn’t train any of its staff to know even the top people in the world of produce.

I kept thinking of the movie The Devil Wears Prada, in which the Anne Hathaway character proves her chops as a personal assistant because she studied up and knows the name of a reception guest, and the existing assistant forgets.

In general, marketing is an afterthought to many in the produce industry. A friend of mine once partnered up and built a fantastic fresh-cut facility. The business failed, and a big part of the problem was that although the creators were willing to invest millions in bricks-and-mortar, the marketing budget was an afterthought. It is not a wise approach. If you asked which was more valuable at Coca-Cola — all the factories that produce and deliver Coca-Cola or the name and recipe — there is not the slightest question. The name and recipe represent a call option on shelf space in retailers around the world.

Even a booth at a trade show requires marketing. Just as a retailer in a shopping center is not wise to wait passively for customers to come by, an exhibitor needs to work before a show to maximize success. Plan out who they would really like to see, and invite them to visit.

There are both offensive and defensive reasons for doing trade shows. Sure, one may seek out new customers or suppliers or look to increase orders from existing customers, but it is also true that one doesn’t want one’s existing customers tied up with competitors all day and night. So, participation in the show, in dinners, receptions, etc., all adds value — but few companies can track this value.

A year really means nothing – it is the time it takes the earth to orbit around the sun. Yet, due to corporate budgeting cycles, companies have trouble in expending money when the returns are longer term. Yet deep relationships are always longer term.

In the produce industry, there are of course many options for marketing. There are print publications, digital publications, brochures, videos, on and on. Trade shows and conferences uniquely play directly to the key to produce industry success, building and reinforcing relationships. This is perhaps where companies most fail in assessing the value of participation in trade shows and events. A year really means nothing — it is the time it takes the earth to orbit around the sun. Yet, due to corporate budgeting cycles, companies have trouble in expending money when the returns are longer term. Yet deep relationships are always longer term.

Trust builds slowly, the mutual exchange of kindnesses, of favors, the growth of mutual respect — that is not likely to show up on a call report or reflect in that week’s sales. Yet what can be more important than to have a staff well-connected in the industry, with people respecting the team enough to want them to succeed, to want to help them.

Whether an event is big or small scarcely matters, because human relationships are built one person at a time. The importance of relationships is why it is a terrible mistake to cheap out and not stay in the official hotel or go home rather than take people out to dinner, for coffee or a drink. Going to a workshop or a tour is more than education … it creates a common narrative to enable deeper discussions.

I had a very successful Fruit Logistica. How could I not?  After all, the real secret to all these events is you get out what you put in. Now I sit on this plane making lists of who I want see at  The London Produce Show and Conference, I’m thinking of the Opening Cocktail Reception, the Perishable Pundit Thought-Leader Breakfast Panel, the regional tours, co-located events like the annual Brexit Workshop, the Foodservice Forum and, for the first time, The Global Grape Summit.

I’m thinking of old friends and hoping to meet new. And I’m thinking of the companies that are the most visionary, the ones that see beyond country, beyond division, beyond time itself — and the people from those company who engage with the event, knowing the value is not always calculable ... indeed that it is so great as to be incalculable.