The events industry globally will be adjusting its staffing, expenditures and pricing to stay afloat during the COVID-19 crisis. The findings come from a study released in June by the University of Westminster, London. The research survey was carried out by Dr. James Morgan, principal lecturer in event design and technology, Tourism and Events Research Group, at the university.
PRESSURE ON PRICING With businesses of all kinds facing a fall-off in demand, the pricing of event products and services is a sensitive issue as revenue streams need to cover fixed and variable costs. Sixty-six percent of respondents in the survey acknowledged that a downward change in pricing is needed. Some 8.9 percent of respondents felt that their competition would be reducing prices and they would have to follow suit.
In a chilling finding, nearly 40 percent of respondents were uncertain that the business they are associated with will exist within the next six months.
LABOR LEVELS CUT The study shows that staffing cuts and furlough strategies have been implemented by companies surveyed, cuts that will continue for the next six to 12 months. Nearly 26 percent of respondents have furloughed full-time employees, while nearly 13 percent of companies have let full-time employees go. In a positive indicator, some 42.5 percent of companies had not made any staffing changes as of mid-May.
Due to respondents indicating that they had a lack of sufficient funds to ensure survival in the current climate, they were asked about taking advantage of government-backed loan plans. Nearly 50 percent of respondents have applied or will be applying for government loans. Also, there is anecdotal evidence that as business valuations decrease in 2020, cash-rich companies might start to acquire devalued companies, or merge both vertically (with a supply chain) and horizontally (with competitors).
The complete report is available for download here; University of Westminster should be credited in any published work.