After canceling the NPE2021 show because of the worsening coronavirus pandemic, the Plastics Industry Association says it will not be able to return the first half of deposits paid by exhibitors and has decided not to have a virtual NPE2021 show.
The Washington-based trade group, which owns the NPE trade show, disclosed those developments in an email that went out to exhibitors late in the afternoon Jan. 22.
Some companies that planned to exhibit are wondering what will happen regarding the rest of their deposits, which were due Jan. 8. Some made the payment as a 2020 business expense, but others withheld it when the show was canceled.
Conrad Bessemer, president and CEO of Novatec Inc., said the auxiliary equipment maker put $50,000 down on a $100,000 booth but didn't pay the balance. He and other trade group members are upset about the timing of the event's fee schedule and cancellation, which was announced Jan. 5.
"The criticism of many members is that this was a freight train, which was predictable, and the organization seemed to avoid final judgment until the last possible moment — when the next deposit was due," Bessemer told Plastics News. "And, it is still unclear as to whether the organization is holding exhibitors to the next payment or not."
The association canceled the show after it became apparent that the COVID-19 situation in the U.S. was worsening and it would not be possible to hold the May trade show. In the email to exhibitors, the group said it made the decision quickly.
"Once it became apparent that there would be no path forward for the live event, we quickly made the decision to inform all of our exhibitors of this decision, in order to minimize any further expenses to you," according to the Jan. 22 email from association CEO Tony Radoszewski.
In its email, the association acknowledged questions from companies about paying the second 50 percent deposit.
"We have heard from our members and exhibitors asking about the status of their deposits for the show," the association said. "We understand that it's hard for companies to justify paying the second 50 percent due, given the circumstances."
Bessemer called the communication "artfully worded" and he described NPE exhibitor contracts as "absolutely in favor of the organization and not to the favorability of the members of the very organization they represent."
The trade group told exhibitors that because there are "significant ongoing expenses" that it incurs in planning the huge triennial trade show, it cannot return initial deposits paid.
"The first 50 percent of exhibitor deposits have been invested in the myriad expenses required in the advance planning stages of the show, as well as to support ongoing operations for [the association], and therefore cannot be returned," the group said in its email.
Association leaders had been saying for several weeks that they may not be able to return deposits.
The show had been scheduled for May 17-21 at the Orange County Convention Center in Orlando, Fla. The next one is scheduled for 2024.
"Our stated objective was to apply our deposit to the 2024 show. We will see if that happens or not. Ethically it should, but much remains to be seen," Bessemer said.
Peter Gardner, vice president of sales and general manager of the LS Mtron plastic machinery division of Daiichi Jitsugyo (America) Inc., shares many of Bessemer's concerns. He said the South Korea-based company paid its first installment of $42,500 for an $85,000, 3,500-square-foot booth, but withheld the second half.
"We are also trying to confirm about the remaining portion due by the contract," Gardner said in an email. "Although the [trade group's] letter states they understand why we would be reluctant to pay it, it does not specifically say they won't be asking to collect it by the contract terms."
DJA officials also would like to know more about any steps taken by the association to minimize or recoup losses, Gardner said.
"For example, is there any insurance coverage in place for business losses? What are the expenses which cannot be recovered?" he asked.
The Jan. 22 email from Radoszewski also said that the trade group's leadership decided not to have a virtual version of NPE2021. It had previously planned a virtual version to run alongside the in-person portion.
"The member-run NPE sales & marketing and executive committees and the officers of the ... board of directors, after evaluating all the factors and commitments involved in staging a virtual event, decided not to pursue a virtual show in 2021," Radoszewski wrote. "We will, of course, continue to explore all feasible options for an industry event that would serve to help strengthen the industry, our members and the association."
Gardner called that announcement a surprise.
"I would have thought it would be at least a way for them to justify keeping the funds paid," he said.
NPE exhibitors are also looking at their options. Challen DeMartino, spokesperson for SI Group, isn't sure just yet what that will be after all the effort that had gone into event planning.
"SI Group has been preparing for NPE2021 since attending NPE2018 and securing its booth location for NPE2021 in early 2020," DeMartino said in an email. "However, SI Group has been cognizant of the current global conditions and the health and safety of our employees remains our top priority. While NPE2021 has been a key event for SI Group for many years, we are planning to seek alternative meeting opportunities and other marketing initiatives in lieu of NPE2021."
Bessemer said marketing and customer outreach need to be a constant and consistent approach, not limited to a triennial trade show.
"Many of us were already questioning the value of this event and the extreme expense associated with it and this situation will only accelerate that as we all look at new ways of reaching customers," Bessemer said.
Webinars and video conferencing have proved beneficial, he added.
"Many machinery manufacturers increased revenue during 2020 without much business travel, without customer visits and without in person events," Bessemer said. "Many of us are increasingly focused on new ways of reaching our customers in this new normal and increasingly question the long-term value of a once-every-three-year event when our organizations need customer reach every day of the week."