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Thailand's MICE industry: A global industry surviving the global economic crisis

By Jon Fernquest

Queen Sirikit Center

Last week there were several Bangkok Post articles that focused on events and event-organising.

First of all, marketing events have proved a more cost-effective form of advertising for many companies during the recession.

Popular events can even make money for a company as well as being a form of advertising.

Second, organising events has become one of the specialities or fortes of Thailand's tourism industry.

Thailand has developed over several years as a prime location for international events and conferences, a specialty within the global tourism industry known as Mice (meetings, incentives, conventions and exhibitions).

Unfortunately, the political turmoil in Thailand has taken its toll on the industry and many events have been cancelled in recent months (Read article).

The article below appeared in the Bangkok Post last week and was first published in the Business Times of Singapore.

The article discusses how one company, Pico Thailand, is managing to weather the global economic downturn.

cost-effective - produces good results for low cost
popular events - events that lots of people like
speciality- the work that someone does the best or the subject they know the most about
forte - some activity that you are very good at doing
Mice (meetings, incentives, conventions and exhibitions) industry - the tourism industry of organising large events (See Wikipedia)
political turmoil - conflict and disorder in politics, different groups fighting for political power
taken its toll on - have had a negative effect on
weather the economic downturn - like a dangerous storm, protect yourself from damage and survive until it is finished

Pico Thailand is listed on Thailand's SET stock exchange and 40% owned by a parent company in Singapore:

WHEN DOWNTIME IS STILL SHOWTIME

Times are tough in the Mice sector, but Pico has advantages that could help it eke out growth, reports Nisha Ramchandani

NISHA RAMCHANDANI
18-04-2009

It's looking like a difficult year for most industries - and the Mice (meetings, incentives, conventions and exhibitions) industry is no exception. But Pico Far East Holdings is confident it can ride out the storm, banking on pluses such as a strong pipeline of projects.

"We're trying to be more operationally efficient and more cautious," says managing director Jean Chia. "The Mice industry has a time lag. Sometimes, the cost of cancellation is more expensive than going ahead with a project. The time lag allows us to react to it."

Pico's geographic span and different business segments will also help cushion it, she says. "We are cautiously optimistic at the moment."

Pico's four business segments are: exhibition and event marketing services; museum, themed environment, interior and retail; brand signage and visual communication; and conference and show management.

downtime - when machines and factory are not working and not producing goods
showtime - when the actual live performance is going on, when the actors or presenters are on stage and working in front of the audience
ride out the storm - protect yourself during the storm and survive to the end of the storm
banking on Y - relying on Y to make money, expecting to make money from Y
pluses - theadvantages that the company has
banking on pluses - using the company's advantages to make money
pipeline of projects - projects that they are working on that have been finalised or completed yet
business segments - parts of a company's work, the businesses that a company does

In Singapore, the exhibitions segment is feeling the heat from the recession. At least three events scheduled for his year have been cancelled or postponed so far.

MetalsAsia 2009 was scrapped as the weak outlook for industries such as aerospace and electronics took its toll on manufacturing and precision engineering.

The Asian Welding Show Singapore 2009, a new show slated for July and expected to bring in 10,000 international participants, has been put on hold indefinitely.

And Pulire Asia, a trade exhibition that focuses on cleaning technologies and products, has also been postponed.

It will also be harder to draw crowds at trade exhibitions, as corporate travel budgets are slashed. "Budgets are indeed reduced, but we're seeing a reallocation,'' said Ms Chia. "There seems to be a focus on where the money should go."

feeling the heat - suffering, experiencing difficulties
postponed - delayed, change date and move to the future
scrapped - cancelled
slated for - planned for the future (See glossary)
put on hold indefinitely - delay doing the project, but date for starting again not set yet
draw crowds - many people come to see it
trade exhibitions, trade fair, trade show, expo - a large event organized so that companies in an industry can show and demonstrate their latest products and services, also study activities of competitors and examine recent trends and opportunities (See Wikipedia)
budgets are slashed - budgets are reduced
reallocation - moving money or resources from one use to another use
a focus - people are concentrating on this, thinking a lot about this, worried about this

Companies are more targeted in their spending. "Instead of advertisements, they may spend on an event so they can see a return on investment,'' she says. "This is a trend we are seeing. It benefits a player like Pico."

For the financial year ended Oct 31, 2008, Pico posted 16.4% year-on-year growth in net profit to HK$169.65 million, up from HK$145.52 million. Turnover jumped 22.4% to HK$2.63 billion. The bulk of the turnover came from exhibition and event marketing services, at 83.4%. The museum, themed environment, interior and retail business contributed 7.5%, brand signage and visual communication accounted for 7.1% and conference and show management 1.9%.

Greater China contributed 48% of total turnover, while 38% came from other parts in Asia. The Middle East accounted for 7% and remaining business came from Europe and the United States.

more targeted in their spending - spending on a smaller group of chosen or targeted things
turnover - sales, sales revenue, the total value of goods and services sold by a company a period of time
the bulk of turnover - most of the sales
exhibition - a public event displaying objects of interest (either commercial or artistic)
a theme - an idea or pattern found in a work of art or a design
themed environment - design a building or rooms in a building according to a certain theme (make it look like the beach for a beach resort show, for example)
brand signage - signs that display a brand and logo on them

Ms Chia agrees that Pico will feel a squeeze - but says salary cuts and layoffs are not on the cards. Instead, the company is looking at other ways to contain costs and makes better use of resources.

Pay cuts and retrenchments "would really be the last resort'', she says. "We would like to be more creative - look at seconding people, look at our operating expenses. We will see if we can reduce work weeks. We would like to keep [our] people. We are a people business.''

feel a squeeze - doing business has become difficult difficult, difficult to make money
retrenchments - reduce workforce, reduce the number of people working for a company (to cut costs)
the last resort - if all other solutions fail then we will try this
seconding people - send people to a different department to do another type of job for a short period of time
we can reduce work weeks. We would like to keep [our] people. We are a people business.''

The strong performance of companies in the year before the downturn and an increase in government spending, especially in Asia and the Middle East, helped Pico grow strongly before the downturn, she says. "The stimulus packages also have good initiatives.''

This sentiment is echoed by Pico chairman Lawrence Chia. "We expect 2009 to be an uncertain year," he says. "We are also cautiously optimistic that a global economic recovery may begin earlier than expected due to bold financial and fiscal stimulus packages implemented in many countries.''

Pico is banking on its strong liquidity and experienced management to help it eke out growth during the downturn.

statement is echoed - the feeling is repeated
cautiously optimistic - feel that the future will be good but also planning in case there are problems too
bold financial and fiscal stimulus packages implemented in many countries
strong liquidity - has enough money to continue in business (even under bad economic conditions when there are not many projects or income)
eke out growth - work hard to grow just a little bit

New projects, new business

Major Singapore contracts that Pico has landed in recent times include projects for the two integrated resorts and the installation of grandstands and corporate hospitality suites for the Singapore Grand Prix. It also completed projects in Thailand, France, Bahrain, Dubai and the US last year.

"We have some confirmed projects in the pipeline for 2009 which will help tide us through,'' says Ms Chia.

Pico, which employs about 2,400 people in 34 cities worldwide, will continue to focus on Asia and other parts of Greater China. The company has presence in Thailand through SET-listed Pico Thailand Plc in which the Singaporean parent owns a 40.12% stake. BUSINESS TIMES

land a contract - win or get a contract ("contracts that Pico has landed")
integrated resorts - resorts integrated with an event or conference
grandstands - rows of seats for people to sit on at sports events
corporate hospitality suites - special rooms where the guests of the company (corporation) paying for the event (sponsoring) sit, as a kind of gift for doing business with the company
confirmed projects - the project is happening for sure, they have been hired for the project for sure
in the pipeline - not finalised or finished yet
help tide us through - help us survive during a difficult period
own a stake - owning part of a company ("Singaporean parent owns a 40.12% stake")

(Source: Bangkok Post, business, from Business Times, Singapore, 18-04-2009, WHEN DOWNTIME IS STILL SHOWTIME, NISHA RAMCHANDANI)

Posted by Jon Fernquest at 06:23 PM | Permalink | Comments (0)

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Second, organising events has become one of the specialities or fortes of Thailand's tourism industry. Thailand has developed over several years as a prime location for international events and conferences, a specialty within the global tourism industry known as Mice (meetings, incentives, conventions and exhibitions). Unfortunately, the political turmoil in Thailand has taken its toll on the industry and many events have been cancelled in recent months (Read article). The article below appeared in the Bangkok Post last week and was first published in the Business Times of Singapore. The article discusses how one company, Pico Thailand, is managing to weather the global economic downturn. cost-effective - produces good results for low cost popular events - events that lots of people like speciality- the work that someone does the best or the subject they know the most about forte - some activity that you are very good at doing Mice (meetings, incentives, conventions and exhibitions) industry - the tourism industry of organising large events (See Wikipedia) political turmoil - conflict and disorder in politics, different groups fighting for political power taken its toll on - have had a negative effect on weather the economic downturn - like a dangerous storm, protect yourself from damage and survive until it is finished Pico Thailand is listed on Thailand's SET stock exchange and 40% owned by a parent company in Singapore: WHEN DOWNTIME IS STILL SHOWTIME Times are tough in the Mice sector, but Pico has advantages that could help it eke out growth, reports Nisha Ramchandani NISHA RAMCHANDANI 18-04-2009 It's looking like a difficult year for most industries - and the Mice (meetings, incentives, conventions and exhibitions) industry is no exception. But Pico Far East Holdings is confident it can ride out the storm, banking on pluses such as a strong pipeline of projects. "We're trying to be more operationally efficient and more cautious," says managing director Jean Chia. "The Mice industry has a time lag. Sometimes, the cost of cancellation is more expensive than going ahead with a project. The time lag allows us to react to it." Pico's geographic span and different business segments will also help cushion it, she says. "We are cautiously optimistic at the moment." Pico's four business segments are: exhibition and event marketing services; museum, themed environment, interior and retail; brand signage and visual communication; and conference and show management. downtime - when machines and factory are not working and not producing goods showtime - when the actual live performance is going on, when the actors or presenters are on stage and working in front of the audience ride out the storm - protect yourself during the storm and survive to the end of the storm banking on Y - relying on Y to make money, expecting to make money from Y pluses - theadvantages that the company has banking on pluses - using the company's advantages to make money pipeline of projects - projects that they are working on that have been finalised or completed yet business segments - parts of a company's work, the businesses that a company does In Singapore, the exhibitions segment is feeling the heat from the recession. At least three events scheduled for his year have been cancelled or postponed so far. MetalsAsia 2009 was scrapped as the weak outlook for industries such as aerospace and electronics took its toll on manufacturing and precision engineering. The Asian Welding Show Singapore 2009, a new show slated for July and expected to bring in 10,000 international participants, has been put on hold indefinitely. And Pulire Asia, a trade exhibition that focuses on cleaning technologies and products, has also been postponed. It will also be harder to draw crowds at trade exhibitions, as corporate travel budgets are slashed. "Budgets are indeed reduced, but we're seeing a reallocation,'' said Ms Chia. "There seems to be a focus on where the money should go." feeling the heat - suffering, experiencing difficulties postponed - delayed, change date and move to the future scrapped - cancelled slated for - planned for the future (See glossary) put on hold indefinitely - delay doing the project, but date for starting again not set yet draw crowds - many people come to see it trade exhibitions, trade fair, trade show, expo - a large event organized so that companies in an industry can show and demonstrate their latest products and services, also study activities of competitors and examine recent trends and opportunities (See Wikipedia) budgets are slashed - budgets are reduced reallocation - moving money or resources from one use to another use a focus - people are concentrating on this, thinking a lot about this, worried about this Companies are more targeted in their spending. "Instead of advertisements, they may spend on an event so they can see a return on investment,'' she says. "This is a trend we are seeing. It benefits a player like Pico." For the financial year ended Oct 31, 2008, Pico posted 16.4% year-on-year growth in net profit to HK$169.65 million, up from HK$145.52 million. Turnover jumped 22.4% to HK$2.63 billion. The bulk of the turnover came from exhibition and event marketing services, at 83.4%. The museum, themed environment, interior and retail business contributed 7.5%, brand signage and visual communication accounted for 7.1% and conference and show management 1.9%. Greater China contributed 48% of total turnover, while 38% came from other parts in Asia. The Middle East accounted for 7% and remaining business came from Europe and the United States. more targeted in their spending - spending on a smaller group of chosen or targeted things turnover - sales, sales revenue, the total value of goods and services sold by a company a period of time the bulk of turnover - most of the sales exhibition - a public event displaying objects of interest (either commercial or artistic) a theme - an idea or pattern found in a work of art or a design themed environment - design a building or rooms in a building according to a certain theme (make it look like the beach for a beach resort show, for example) brand signage - signs that display a brand and logo on them Ms Chia agrees that Pico will feel a squeeze - but says salary cuts and layoffs are not on the cards. Instead, the company is looking at other ways to contain costs and makes better use of resources. Pay cuts and retrenchments "would really be the last resort'', she says. "We would like to be more creative - look at seconding people, look at our operating expenses. We will see if we can reduce work weeks. We would like to keep [our] people. We are a people business.'' feel a squeeze - doing business has become difficult difficult, difficult to make money retrenchments - reduce workforce, reduce the number of people working for a company (to cut costs) the last resort - if all other solutions fail then we will try this seconding people - send people to a different department to do another type of job for a short period of time we can reduce work weeks. We would like to keep [our] people. We are a people business.'' The strong performance of companies in the year before the downturn and an increase in government spending, especially in Asia and the Middle East, helped Pico grow strongly before the downturn, she says. "The stimulus packages also have good initiatives.'' This sentiment is echoed by Pico chairman Lawrence Chia. "We expect 2009 to be an uncertain year," he says. "We are also cautiously optimistic that a global economic recovery may begin earlier than expected due to bold financial and fiscal stimulus packages implemented in many countries.'' Pico is banking on its strong liquidity and experienced management to help it eke out growth during the downturn. statement is echoed - the feeling is repeated cautiously optimistic - feel that the future will be good but also planning in case there are problems too bold financial and fiscal stimulus packages implemented in many countries strong liquidity - has enough money to continue in business (even under bad economic conditions when there are not many projects or income) eke out growth - work hard to grow just a little bit New projects, new business Major Singapore contracts that Pico has landed in recent times include projects for the two integrated resorts and the installation of grandstands and corporate hospitality suites for the Singapore Grand Prix. It also completed projects in Thailand, France, Bahrain, Dubai and the US last year. "We have some confirmed projects in the pipeline for 2009 which will help tide us through,'' says Ms Chia. Pico, which employs about 2,400 people in 34 cities worldwide, will continue to focus on Asia and other parts of Greater China. The company has presence in Thailand through SET-listed Pico Thailand Plc in which the Singaporean parent owns a 40.12% stake. BUSINESS TIMES land a contract - win or get a contract ("contracts that Pico has landed") integrated resorts - resorts integrated with an event or conference grandstands - rows of seats for people to sit on at sports events corporate hospitality suites - special rooms where the guests of the company (corporation) paying for the event (sponsoring) sit, as a kind of gift for doing business with the company confirmed projects - the project is happening for sure, they have been hired for the project for sure in the pipeline - not finalised or finished yet help tide us through - help us survive during a difficult period own a stake - owning part of a company ("Singaporean parent owns a 40.12% stake") (Source: Bangkok Post, business, from Business Times, Singapore, 18-04-2009, WHEN DOWNTIME IS STILL SHOWTIME, NISHA RAMCHANDANI) Posted by Jon Fernquest at 06:23 PM \| Permalink \| Comments (0)
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April 28, 2009

Thailand's MICE industry: A global industry surviving the global economic crisis

WHEN DOWNTIME IS STILL SHOWTIME

New projects, new business