Alexandria, Va.-based event/DMC giant PGI (www.pgi.com) on Monday closed eight of its DMC offices and announced a restructuring of its management to focus on event production and meeting services.
PGI closed offices in Dallas, Houston, Denver, Orange County, Calif., Palm Beach, Fla., Atlanta, Philadelphia and Athens. Some 50 employees lost their jobs. The company continues its DMC operations in New York, Washington, Orlando, Fla., Miami, New Orleans, Detroit, Chicago, Scottsdale, Ariz., Las Vegas, San Francisco, San Diego, Palm Springs, Calif., Vancouver, London and Stuttgart, Germany.
In a press conference Wednesday, PGI president and chief operating officer Bob McCormick told reporters that since creating its “Destinator by PGI” brand just over a year ago, the company has decided that its Meeting Services Plus function acting as a sole point of contact serves clients effectively in various cities, rendering stand-alone offices focusing on destination management “redundant.” The company will recast itself with a single brand: PGI The Strategic Events Agency. McCormick said that remaining DMC services would be folded under this brand.
When asked if the shuttered offices were losing money, McCormick said that the affected offices were in markets where “there wasn’t an opportunity to grow that business.” He added, “PGI is a profitable business. We made a nice profit last year, and will make a nice profit this year.” According to estimates by Special Events Magazine, PGI generates revenues of from $110 million to $120 million a year, of which roughly half came from Destinator by PGI.
When queried about rumors that PGI has been on the market, McCormick said that while talks had gone on with various companies, PGI leadership has elected to “stay an independent company for the foreseeable future.” He also pointed to a recent round of “significant investment” in PGI from backers as a sign of their faith in the company’s future, but declined to specify the amount.
He also refuted the rumor that PGI would not fulfill existing contracts in its shuttered DMC offices, saying such an assertion was “absolutely not true. Every single contract has been covered.”
Joining McCormick on the leadership team will be executive vice president of sales David Kahn, most recently the agency’s group vice president in the automotive marketplace and general manager of its Detroit operation; Matthew Sheppard, who moves from his post of chief operating officer of the Destinator by PGI division to become executive vice president of operations overseeing the firm’s five service areas; and CB Wismar, executive vice president, marketing and strategic communications.