Australian retailers are often given a good price on goods purchased from their wholesalers only to later find the invoice charges them more for freight than the actual cost.

Australian freight companies (they are all treacherous) all charge customers based on either the cubic space of the consignments or the weight whichever is the highest.

Gifts and homewares product consignments almost always, weigh lower than their designated weight per cubic meter, so are charged on the basis of the cubic space they occupy and then a rate per cubic meter dependent upon the distance carried.

Interstate capital cities freight rates are cheaper, and then the more remote the destination (or number of depots) distant from that capital city, determines the rate per cubic meter (or rate per kg converted from their chosen kg rate per cubic meter).

Since a lot of retailers are paying freight on consignments regularly, they should know when they are being stiffed. Some don’t complain, “They just never come back”. However some wholesalers with periodic products like Christmas wholesalers must imagine that you won’t remember next year, as they seem to be more prone to sticking it to their customers with inflated freight components.

It’s a good habit to ask wholesalers at the trade fairs “is the freight cost based on actual cost”, because they will know in advance not to try this nasty little trick and you can later ask them to demonstrate the actual cost.

Good wholesalers will not only be basing their freight charge on the actual cost, but will also have lower than average freight costs because of the sheer volume they generate for their freight company and they will be passing that on to you.

An interesting article by author, speaker and marketing strategist Seth Godin analyses the strategies of marketing to the way consumers are thinking in hard times:-

” When times are good, buying things is a sport. It’s a reward. The story we tell ourselves is that we deserve it, that we want it and why not?

When the mass psychology changes and times are seen as not so good, the story we tell ourselves changes as well. Now, we buy out of defense, to avoid trouble. Or we buy because something will never be as cheap again. Or we buy smaller items for the same sense of reward.

Of course, the two different extremes can lead you to buy the very same thing. It’s not the thing so much as it’s the story.

Starbucks was the indulgence of a confident person happy to blow $4 on a cup of coffee. Starbucks can become the small indulgence for the person who just traded down to a small rented apartment.

The challenge for marketers is to figure out how to change the story they are living so that their customers can change the story they tell themselves. What you make, where you make it, who makes it, how it’s priced and sold and … it all adds up to a perception. If you change these elements the story will change too.”

The message demonstarted this article is that retailers can continue selling well in hard times if you think it through. You may just have to modify your products and/or presentation.

A letter to Members from Mark Baker, GHA’s Exhibition Manager :-

“It has come to GHA’s attention that Reed Gift Fairs is targeting GHA members and non-members alike and aggressively maligning our 2009 July Home & Giving Fair in Sydney.  In the best interest of our members and the industry overall, we must rebut some of the current claims.

First and foremost, GHA already enjoys a critical mass of confirmed exhibitors for the 2009 July Sydney Home & Giving Fair.  The support we have received at this early date is unprecedented for an inaugural Fair.

Secondly, the early buy-in from our members is further confirmation that our research, which supported a repositioning of the second Sydney Home & Giving Fair to early July, was absolutely correct. This of course is confirmed in feedback we have received that the recent September fair was such a sales disappointment for so many.  Our exhibitors fully appreciate that holding the event earlier allows retailers more opportunities to order, receive and sell products prior to the end of the year.

Thirdly, based on numbers freely provided by Reed Gift Fairs for its September 2008 Fair, it should be obvious to everyone that the September time-frame is no longer viable.  GHA cannot help but question the reasoning behind continuing to promote a fair proven to be of decreasing relevance to the industry.

Fourthly, again, based on Reed Gift Fairs’ own numbers, the July Gift Fair in Brisbane continues to shrink for both exhibitors and attendees. While Brisbane may remain a viable show in the future for the immediate surrounding region, GHA firmly believes it will never enjoy the national impact commensurate to the Home and Giving Fairs held in Sydney and Melbourne.

Lastly, everyone on the receiving end of Reed Gift Fairs’ aggressive maligning of GHA Home & Giving Fairs should be asking one question:  If Reed’s gift fairs in Brisbane in July and Sydney in September were progressing so well, would they need to resort to such tactics?  In other words, could their exhibition sales be slower than expected?

GHA does not and will not engage in such tactics. GHA has an overwhelmingly positive outlook moving forward regarding our new July 2009 Home & Giving Fair in Sydney.

Thank you for your support. I look forward to working with each and every one of you to ensure we represent the very best our industry has to offer.

To discuss exhibiting at any of our future Home & Giving Fairs, please contact the Trade Fairs Team at 02 9763 3222.

Sincerely yours,

Mark Baker
Exhibitions Manager

GHA has announced a major overhaul of its trade fair allocation and exhibition contracts with members from February 2009 as part of it fight back to secure its trade fair exhibitions, increase the quality and quantity of exhibitors for retailers and to increase the benefits to exhibitor members.

Established by its exhibitors over 30 years ago, GHA is a not-for-profit organisation that provides the most cost effective trade shows in the gifts and homewares industry.

New sweeping changes to their stand allocation system, are designed to make it fairer for regular and loyal exhibitors, provide surety of tenure, easier long term planning and make it more difficult for competitors to offer one-off deals to entice some members to exhibit elsewhere instead.

Key stand allocation changes include:-
(1) Formally adopting the previously proposed loyalty bonus, where a Member company who exhibits with GHA at all three of GHA’s Home & Giving Fairs in any one calendar year gets an additional bonus Trade Fair Point.

(2) Reallocation of all exhibition space for all fairs for 2009.

(3) Reduced rates for contracted exhibitors who sign up for 2 or 3 fairs per annum, with higher reductions for longer contract terms.

(4) Changing the basis of fresh reallocation of a floor plan, so that Key Exhibitors (as determined by GHA management), are allocated space first irrespective of trade fair points, followed by members who are contracted exhibitors, ahead of casual and occasional exhibitors, each based on trade fair points.

(5) Only contracted exhibitors will have rebooking rights for the same space. (Key Exhibitors will be required to be contracted).

Gift & Homewares Australia’s Chief Executive Alby Taylor says:

“GHA has lead industry change for more than three decades.  As the peak representative body in the gift & homewares industry, we are receiving support from our members for improvements that must be made to help people’s businesses and the industry prosper into the future.

“We have taken considerable care to ensure that our new policies are fair for all members and benefit the industry as a whole.

“Beginning in February 2009, our new exhibition policies come into effect and consist of: a new stand allocation system; and discounted exhibition rates for loyal members who commit to a multi-fair contract. We are rewarding our members’ loyalty by offering an unbeatable return on investment.

“Unlike commercial exhibition companies, we have a genuine interest in the long term future of people’s businesses and the industry as whole.”

Specialist Exhibition company Reed Gift Fairs of Chatswood NSW has published the results of a survey designed to identify the current and preferred seasonal buying preferences of retailers and their planned gifts and homewares trade fair visitation in 2009.

The results say that most retailers currently buy stock for the main Christmas period buying season during August (70.1%) and September (69.4%) with the next most popular month being later in October (31.3%). Their preferred month for buying was August (31.3%) with September a close (27.8%) followed by October & July (almost equal and both at half those levels). Reed emphasises that the survey results show that the current cycle of trade fairs is already accurately timed.

Reed have been ramming this message home to all exhibitors at the Melbourne trade fair with huge billboards and by mail-out direct to all exhibitors. No doubt as a result of their hopes to keep the windfall September Sydney fair to themselves now. Reed seem to be determined to further embarrass their competitors GHA, following the GHA’s failure to secure enough exhibitors for September 2008 and simultaneous announcement that they were planning to do July trade fairs in Sydney instead from 2009, launching on the same date as Reed’s Brisbane gift fair.

Disillusioned GHA Members who had booked to exhibit at the Sydney September 2008 fair at the Showgrounds at Homebush were forced to pay almost double the rate at the Reed venue at Darling Harbour, mainly because the GHA (Gift & Homewares Association) is a not for profit organisation. Reed have since switched their Brisbane 2009 gift fair date to reduce the possibility that GHA’s Sydney July Home & Giving fair may draw exhibitors away from the Brisbane fair.

Key issues for GHA exhibitors now are; will the September gift fair now be worthwhile when the costs are almost double? Will Reed put the prices up further if they keep a monopoly on the more popular Sydney September fair dates? And can exhibitors afford to give up the September booking to try the cheaper July Sydney Fair? Or should they just scrap both? The problem for most exhibitors is that the costs of exhibiting at the smaller fairs are often not covered by sales results.

An interesting battle looms between July and September fairs and these two organisations as there does not seem to be room for two annual Sydney trade fairs within 3 months. The experienced hard nosed management at Reed have proven to be formidable in the recent past by winning over many GHA exhibitors even though GHA are able to offer exhibition sites at almost half the costs.