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Relevance of Trade Fairs & Exhibitions for SMEs

Perumal Koshy
Dec 2010
Exhibitions, trade fairs and such other networking events have an important role in marketing of products & services of Micro, Small and Medium Enterprises (MSMEs). Harnessing social capital is a critical factor that defines MSME survival in the global market. Reaching out to customers is one of the most challenging tasks for MSMEs. In the competitive world market, they have to be constantly in the look out for new markets, technologies and partnerships. Role of networking events, exposition programs for MSMEs arise in this context. Therefore, way ahead for enabling MSMEs harness social capital is by empowering MSMEs by providing training, building infrastructure for conducting networking events & trade fairs and participating in them, so that they are enabled to reach out and exploit tremendous potentials of global market.

Regionalised Exhibition Infrastructure

MSMEs have to allocate a certain portion of marketing budget and human resources for networking and product-service exposition events. Further, Indian Exhibition and Trade Fair industry, so as to cater to the huge MSME sector, needs a decentralised exhibition development strategy. Rather than focussing on developing exhibition space in few metro cities, the government needs to take measures to develop a much more regionalised development of exhibition infrastructure, in such a way that benefits rural and semi-urban MSMEs as well.

Events and exhibitions can contribute immensely to the economy. Host country or city or a locality that organizes the event would get benefited in a number of ways. Just for instance events & fairs can result in enhanced business tourism, boost hospitality industry, employment generation in other sectors and stimulate infrastructure development. In addition to that it promotes cultural exchange and better understanding between different communities. 

exhibition

Space Problem Hampering Growth

As per the latest estimates by Global Association of Exhibition Industry (UFI), total world gross indoor exhibition space is 31 million sq. meter. There are around 1014 venues that are spread across the world. They hold close to 31,000 events annually. According to the UFI report, dedicated space available for exhibition & trade fair in India is 254, 700 sq.mtr. And the Indian exhibition & trade fair industry as a whole is worth US$ 160 million as per the estimates by Business Strategies Group which prepared the report for UFI. Also, the report says that the Indian exhibition industry has the potential to grow to US$ 990 million in the years ahead. Delhi and Mumbai holds 70 percent of the exhibition market. But the space problem hampers its growth. Creating more space thus is critical to the growth of exhibition and trade fair industry in India.

Chinese Ahead

In way of comparison, India today has only the same exhibition capacity as the city of Chicago. While comparing India and China, Chinese exhibition & trade fair market is as much as 8 times than that of India in terms of space and 3 times in terms of actual events that take place according to UFI. Indian MSMEs has a lot more potential to take part in the global market. Currently, as per the latest available data brought out by the 4th census of MSMEs by the ministry of MSMEs , there are only 40, 504 exporting units. Out of the 26 million strong MSME community, this small section of MSMEs contribute 45 percent to India's total export trade. This in fact takes us to the potential of Indian MSMEs. They can indeed contribute much more to Indian export trade.

Browsing the net for MSME events would lead us inevitably to Chinese websites and event announcements mostly to be hosted by various Chinese cities. Thus, Chinese contribution to world exports is 10 percent as per the latest figures, whereas that of India is just 1.1 percent.

Exhibitions for Branding

Events and exhibitions help enterprises make use of the information channels that are made available to build their brands. Also, MSMEs can directly communicate with their target audience. They can interact with the probable customers directly. They could possibly gather business intelligence as well, for instance, information regarding competitors; their marketing strategies and many other helpful data. In addition to building customer base, exhibitions and networking events enable enterprises explore new technologies available, products and innovative ideas to build their enterprises strategically. Interestingly an increasing number of trade fairs are happening online these days and such events are called virtual tradeshows. Such virtual trade shows are increasing in popularity due to their low cost and convenience.

To be competitive in the global market, what is needed is not just good and innovative products alone, but adoption of right marketing strategies as well. Indian MSMEs therefore need to participate in more exhibitions, trade fairs and other such networking events. Also, it is important to build a strong events & exhibition industry within India. As mentioned, for the huge Indian MSME sector, for the 26 million strong enterprise population, needs much more exhibition space and events. Government should not only facilitate participation in trade fairs and exhibitions abroad, but also encourage organising such events and building a strong trade fair industry within the local market as well.

Participation by MSMEs in events, exhibitions, trade fairs can considerably impact the development of an MSME. They offer opportunities to form an overview of markets, to benchmark themselves as well as their products vis-à-vis developed and larger firms within the MSMEs itself. Also, such occasions offer an opportunity to entrepreneurs to do a firsthand analysis, study and research about the latest developments in terms of products & process.

 
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