Trade fairs, shows: good tools to build international markets

Business America, July 17, 1989 by William F. Kane

The U.S. Department of Commerce encourages U.S' firms to participate in international trade fairs and shows. Business America regularly provides lists of Commerce Department-certified fairs, and every December, we publish a list of overseas trade fairs for the following year to help companies plan ahead; see Dec. 19, 1988, issue. For a different perspective on trade fairs, we present the following article. The author-Director of the Thunderbird Management Center of the American Graduate School of International Management at Glendale, Ariz.-is the editor of the Center's Export Handbook.

Eventually the new-to-export or new-to-market company will need to attend or exhibit at an international trade show or fair. Before doing so, a company executive will probably have many questions: Why should I exhibit at or attend such an event? Are there different types of shows and how do I determine which one is best for us? What can I hope to get out of a trade show? How much is it going to cost and what do I need to do to prepare for such an event? Who runs them and how do I contact them? What assistance can I get from public agencies?

These are all very valid questions and need to be addressed if we are going to encourage U.S. companies to export and sell their wares overseas. First, trade fairs in the United States are an important but not a major marketing tool of most companies. In Europe and Asia, however, trade shows are very important marketing efforts-much business takes place at these shows. A trade show is not only a good place to exhibit and sell your products, but even if you do not exhibit, attending a show or fair can do several things for the potential exporter in a new market. The show is an excellent place to find and identify possible representatives and distributors for your products. It also is an ideal place to see what the competition is offering and at what price. It can give an exporter an idea of market preferences and possible needed design changes for his products in order to compete.

There are several different types of trade showstheir differences need to be evaluated by the prospective user. The two main types of shows are horizontal and vertical. A horizontal show exhibits a wide variety of products. An example of this type of show is the Hamburg Fair, which exhibits almost everything in both consumer and industrial goods. The other is the vertical trade show, which is product-specific; it may be limited, for example, to medical products, computers, or electronics. Electronica, held in Munich, Germany, each year, is a typical vertical show.

Besides exhibitions with individual booths for the display of products and services, there are smaller types of programs that can offer the new exporting company exposure in various countries at a reasonable cost. These include catalog, video catalog, and matchmaker shows, most of which are offered by the U.S. Department of Commerce through U.S. embassies abroad. The catalog shows allow the exporter to display catalogs of its company and products without a representative, The video catalog show is similar, except, in addition to catalogs and brochures, there are short videos on the individual companies highlighted in the show. A representative of the U.S. Department of Commerce and/or your state office of international trade is usually at these exhibits. Any leads generated from these events are refeffed back to the company representative to follow up.

While these shows do not allow the company to have direct access to possible clients and representatives, it is an inexpensive way to make a first inquiry into possible market interest in a country.

Another event that is fairly new and quite popular is the Matchmaker Trade Delegation. It is comprised of briefings and one-on-one meetings with potential representatives and distributors. In order to qualify, the participants have to be new-to-export or new-to-market companies, and they must send a decisionmaker to the program. Appointments are set up for the individual company, and the program is an excellent way to visit possible representatives and distributors for your products in a variety of markets. For additional information, contact your local district office of the U.S. Department of Commerce or your state intemational trade office.

After assessing the various types of shows, the potential exporter must determine which one best fits his needs. Is he better off in a larger horizontal fair where there are thousands of potential buyers for a variety of products or is a smaller product-specific show better for the company's needs? Does the company need to exhibit in the show? Or is it best, for the first time, to attend as an observer to see what the competition is doing and what the exhibits look like, and to determine the possibility of networking and meeting representatives and distributors at the show?

How much is it going to cost? Show prices vary considerably. If cost is a problem, the company should probably first consider a catalog show or a matchmaker event if one is being held in the country that it wishes to market to. The other approach is to attend the show without exhibiting, which can be very cost effective. Many state governments offer new-to-export companies assistance in attending and exhibiting at trade shows. The first approach of any possible exporter should be to contact the state export assistance office.