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Exhibition Performance Analysis: From the Selection of Measurable Criteria to ROI 4. UK Trade & Investment (UKTI)

In this article, we discuss advanced exhibition result analyses and the relevant assessment frameworks focusing on the cases from Global Association of the Exhibition Industry (UFI), Association of the German Trade Fair Industry (AUMA) and UK Trade & Investment (UKTI), 3-stage exhibition performance assessment model suggested by American marketing researchers and Hewlett Packard (HP)’s trade show follow-up practices, where it is possible to not only quantitatively evaluate the performance of participation, but also to assess return on trade show investment (ROTSI).

It is expected that the comparison of these advanced exhibition assessment frameworks can facilitate the further discussion over the accuracy and efficiency of established exhibition assessment models, which have been required to be improved in its quantitative and economic feasibility, so that the tens of billions of won government aids on hundreds of foreign exhibition events could have more fruitful results.

4. UK Trade & Investment (UKTI)
: Analyzing the Economic Feasibility (Cost-Benefit) on Trade Show Access Programs

Why Trade Show Access Programs Should Be Assessed?

UK Trade and Investment (hereafter “UKTI”) has helped the nation’s start-ups and SMBs participate in overseas trade shows through Tradeshow Access Programme (TAP). UKTI’s aid is largely categorized as funding programs and marketing/promotional subsidies. Through these TAPs, a large number of UK SMBs have generated economic benefits directly or indirectly from overseas trade shows. However it is difficult to understand what roles did TAPs play in bringing up the results.

UKTI also wanted to figure out how much its strategic programs have been contributed to the nation’s SMBs that have participated in the events they supported. In this mood, UKTI initiated a collaborative research project with in 2007 with London Economics, aiming to evaluate the economic feasibility and effects of TAPs and establish a new direction for TAPs should take. The interesting point in this research project is that the authors adopted cost-benefit analysis to assess TAPs. This statistical method is a good tool for the participating entity to figure out the additional benefits TAPs can deliver to them, which is, more specifically, the pure benefit they obtained from the event. In this paper we specifically investigate the UKTI’s trade show benefit assessment framework, and discuss what it implies to us.
Why Trade Show Access Programs Should Be Assessed?

The Emergence of TAP
TAP has been crafted by UKTI to help UK start-ups and SMBs especially in cutting-edge industries access and participate in international trade shows and exhibitions held overseas. The aid is largely categorized as funding programs and marketing/promotional subsidies. Qualifications for applying a TAP include 1) being based on UK, 2) a start-up or SMB, 3) new export company, and 4) wishing to participate in overseas exhibitions covering cutting-edge industries.

TAP Group or TAP Solo, Depending on the Participant’s Objectives and Situations
Majority of the participating companies participate in an exhibition in a group entitled as ‘TAP Group’ which forms a group participant (such as a group entry of UK representatives). TAP Group is beneficial for first-time participants such as start-ups since the program can offer not only exclusive aids and supports required for participating in an exhibition, but also additional effects of perception as belonging to a representative UK agency. On the other hand, some companies participate in entitled as TAP Solo, which does not offer the same level of supports TAP Group offers, but is effective for niche market players since it allows the companies to leverage their own marketing strategies to promote their products and services.

Ultimate Goal of TAP
UKTI describes the ultimate goals in the following three perspectives; 1) to help export-oriented start-ups overcome the entry barrier problems and access the target export markets, 2) to provide start-ups in cutting-edge industries an easy access to overseas exhibitions, 3) to help UK companies maximize the return of their participation in overseas exhibitions. Just same as the qualification only allows start-ups and SMBs based in UK, there are many aspects can be seen in TAPs to help and foster companies unskilled at overseas event participation and the relevant performance assessment and analysis.

Implications of the Analysis and Assessment of TAP Benefits
As a part of those efforts, UKTI decided to analyze and assess the performance and benefit of TAPs. Through this analysis and assessment, UKTI can figure out the overall performance and benefit not only from a TAP operator’s point of view, but also from a participant’s point of view. In addition, since the start-ups and SMBs TAPs support, has a limited time and resources in preparing a exhibition participation plan, comparing to large-sized companies, it is imperative for those companies to conduct a preliminary financial self check-up. So, let’s discuss in detail how the TAP benefits analysis and assessment processes, especially the cost-benefit analysis processes are conducted and featured.

Cost-Benefit Analysis Based on a Survey on Participants
To analyze the performance of TAP, UKTI has conducted a cost-benefit analysis. The performance of participant companies aided by TAP is analyzed through this statistics modeling in an objective manner. Cost-benefit analysis which has been widely adopted by policy assessment researches, allows us to quantify the benefits and thus to compare and analyze the results. Through the cost-benefit analysis, one can figure out the financial benefits UK SMBs and start-ups obtained from an overseas exhibition, and bring up with implications and improvements for future participation plans.

The most important factor in assessing TAPs is to calculate the additional benefits a TAP can deliver. In other words, the additional benefit refers to the pure benefits TAP delivers, which would not have been obtained without the TAP. To this end, the cost-benefit analysis is based on the a survey on the participating companies, a comparison to those on non-participating companies and an expert interview (qualitative). Questionnaires for the survey on the participating companies are prepared in the following three categories.

Step 1. Assessing the Pure Profits
Respondent companies are asked to specify the financial benefits in terms of pure profits, they obtained from their participation in an overseas event.

Step 2. Ensuring the Consistency in Answers
Often times, respondents specify their benefits in revenue terms, not in pure profit terms. So there is a checking process to verify all the specifications are expressed in pure profit terms. In case where the respondent is not aware of the pure profit of the relevant fiscal year, it is allowed to specify whether the previous fiscal year’s break-even point was passed (+), or not (-) or just reached (0). For companies passed the break-even point, it is assumed that 17.5% of overall profits were assigned as the pure profit from the exhibition. In case of companies that have not passed or just reached the break-even point, the pure profit is 0.

Step 3. Evaluating the Sustainability of the Profits
In the next step, the profits’ sustainability is evaluated through a series of questionnaires. The future profit is assumed to be reduced by 8%. When the response is ‘Cannot expect how long the same profit can sustain’, then the period is assumed to be five years. The maximum sustainable period is limited to 10 years.
TAP Benefits Assessment through Cost-Benefit Analysis

Step 1. Calculating the Benefits of TAP
Combining the survey results, UKTI quantifies the benefits the participants obtained. By comparing the overall benefits with those of companies participating in the same event without support from TAP, it can calculate additional benefits of TAP, which also allows UKTI to figure out how effectively TAPs are operated. According to the analysis, the average benefits a company can expect from a TAP amounts to £40,542, while the average additional benefit amounts to £15,796. So the companies participated in an overseas event through TAP can expect an additional benefits worth of £15,796, compared to those participated without support from TAP. Indeed more than two out of three participating companies responded that they would have not obtained such results without the supports from TAP, while about 50% of the participants their annual sales would have decreased by at least 10% if they have not participated in the overseas exhibition.

Step 2. Calculating the Operational Cost of TAP
Next, the overall cost UKTI to spend for TAP operations is calculated. According to the calculation results, the overall cost was 11.2 million pounds. 8.8 million pounds (76%) was spent for direct program operation, while 2.1 million was for overseas resident officials and embassy operation and 0.6 million was for administration and indirect cost. On the other hand, expenditures pertaining to TAP Group is significantly larger than that of TAP Solo. 92% of the direct cost (which accounts for 89% of total cost) were assigned for TAP Group.

Step 3. Calculating the Benefit-Cost Ratio of TAP
Lastly, based on the benefits and costs derived from the previous steps, the benefit-cost ratio (BCR) is calculated. The total benefits of all 3,600 TAP participants obtained amounted to 57.1 million pounds, while the total expenditure of TAP was estimated as 11.2 million pounds. According to the calculation results, the BCR was 5.1. In general, if a BCR is more than 1, it is safe to say the economic feasibility of the business is guaranteed, so TAP is regarded as a project with a high economic feasibility. However, it is worth to note that this estimation has a limitation. First of all, the calculation disregarded potential benefits which cannot be quantified, so the resulted BCR could be underestimated. Also, the ratio cannot explain all the other broader benefits a company may obtain from the participation such as knowledge, innovation, creativeness, and the benefits as a member of the group of UK representatives, etc. These limitations can restrict the applicability of the cost-benefit assessment model, but there are some evidences that can counterevidence those limitations. Developing a complementary method to quantify the additional benefits this cost-benefit model may not consider would further improve the accuracy of the assessment and help establish a sound and minute trade show benefit assessment framework.
Facilitating Efficient Aid Programs Based on Accurate Economic Assessments

Despite all the limitations previously discussed, TAP cost-benefit analysis has been widely used to assess the effectiveness of overseas trade show aid programs and utilized as a reference to improve the performance of participatory companies.
The cost-benefit analysis model is remarkable that it can calculate the additional benefits an aid program can deliver in addition to its capability to analyze the effectiveness of the participation. The most compelling advantage of BCR modeling is that it provides an accurate additional benefits, and thus helps prevent operation at a loss, significant loss or damages of the event quality. Through these advantages, the BCR modeling can help start-ups and SMBs self check the financial and economic performances, and further develop trade show programs more efficiently.
In addition, the effectiveness of TAP programs can also be evidenced and supported, so that the participatory companies can expect the benefits. All the participatory companies are either start-ups or SMBs, so the exhibition event is very important opportunity for their future growth. So giving them an idea that TAP is an effective and efficient aid program, will lead to more applications from qualified companies and help achieve the aims of the program.

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