Events sector optimistic of a New Year bounce back

The events industry has been hit hard in 2020, but there is hope that 2021 will make up for it

• Previous restrictions including the rule of six and the 30-person limit for certain events have affected profit margins.
• The British Events Industry Coalition (BEIC) was launched in October to give a voice to the private events industry.
• 2021 could see a ‘bottleneck’ in supply chains for event bookings
• The sector will bounce back next year as people ‘itch’ for a return of in-person events.

It’s been a year of disruption in the events calendar. Major music festivals such as Glastonbury and Reading, the 2020 Wimbledon championships, countless arts, literary and street festivals along with business conferences and private events were either postponed or cancelled altogether.

For an industry that usually brings around £70bn a year to the British economy, the pandemic has had a catastrophic impact. A motion tabled to Parliament in July to schedule a sector re-opening warned that 700,000 jobs and 25,000 small businesses were at risk, while the ‘rule of six’ restriction brought in during October put a further 90,000 exhibition sector jobs in jeopardy.

Dating events company Smudged Lipstick Events has been significantly affected. With a USP of ‘quirky, offline experiences’ designed to get people off their phones and enjoy in-person events, the prospect of lockdown and moving everything online felt like a backward step to founder Jordi Sinclair.

“Our brand is based around improving people’s offline communication skills. When lockdown happened, I watched other businesses move to online events which puts people behind screens again,” Sinclair recalls. “It felt like we were going back to square one.”

Lost revenue in customer refunds and declining sales

Without having a clear timeline of when things could go back to normal, Sinclair was forced to cancel every planned event. “We spent so much money on marketing these events; then bang, we had to refund every customer when the first lockdown was announced. It was unbelievably disheartening.”

Even when things temporarily opened up in July and August, Sinclair struggled to find venues to host events – many had gone into insolvency. He felt at the mercy of the hospitality industry: with venues closed, the events industry couldn’t operate.

Being a limited company, Sinclair was not entitled to any government support or benefits. He realised he had to adapt or lose business.

Smudged Lipstick Events have now diversified their offering and have built up their online brand. They host a mix of online dating nights with ice breaker games and activities, ‘bad dating stories’ open mic nights and social nights for friends. More recently, Sinclair has developed online team building events for corporates. “It brings in less money than in-person events, and there are fewer people [in attendance], but it means my rent is paid each month,” he says. “Revenue has dropped to about 16% of what I normally earn, and that’s on a good week.”

Government discussions with private events sector needed

Katie Soraff, tax specialist and co-founder of the newly-launched British Events Industry Coalition (BEIC) shares his concerns. She and three other industry professionals set up the coalition in October to give a voice to the private events sector during the pandemic.

The private events sector which includes charity and small corporate events, gala dinners as well as so-called lifecycle one-offs such as weddings, birthdays and bar mitzvahs is worth an estimated £10bn a year according to the BEIC. It mostly consists of small business owners, sole traders and freelancers working as face painters, DJs, events planners etcetera. But, says Soraff, they have been completely overlooked.

“The government have lumped us all in with the large exhibition and live music sector, yet we operate on a much smaller scale,” she explains. “We’ve become 90% wiped out. Even when certain events were allowed during the summer, the 30 people limit made it impossible to make any money. Professionals in the private events sector have had their work stripped away. I’ve known several DJs who are now driving for Amazon or have gone into painting and decorating. People’s income has totally dried up.”

BEIC don’t want financial hand-outs which would only be a short-term stopgap. Instead, they want a line of communication with the government, which would pave the way for the private event sector to re-open after lockdown with safety measures in place.

Industry bounce back

Kaziu Gill MAAT, co-owner of Lime Green Accountancy, works with several businesses across the events sector. He is optimistic that the industry will bounce back. “Events businesses ground to a halt when lockdown started in March, and many weddings were postponed, but many of our clients have had a flurry of bookings for next year already,” he says. “It’s been brutal for one-person companies and those running freelance gigs, and there have been many job losses, but I’m optimistic the industry will return as healthy as ever. I think Spring 2021 will be like the roaring ’20s.”

Even so, Gill believes there is likely to be a bottleneck in venues and sector supply chains due to ‘pent up demand’, which could drive prices up for the end-user, so clients and customers should expect to pay more to secure the dates and services they want.

When the events industry does re-open, it’s likely to look different. “With everything going online, there’s been a huge boom in digital events,” says Gill. “Digital and virtual events are likely to emerge as a subindustry which will continue to grow long after lockdown.”

Adapting existing product offering

It was certainly the case with team-building event services Zing Events who had to adapt their offering completely. Having worked in the events industry during the last recession, co-founder Andy Wells says he knew they needed to react quickly and ‘invest heavily’ in software if they were to survive. Within weeks of lockdown, the company moved its entire events programme online. It now hosts augmented reality versions of their in-person team building events including escape room and crystal-maze type challenges as well as online cocktail masterclasses and cookery classes.

“We run around 50-60 virtual events every month now. We’ve been busier than we’ve ever been, even in September which is traditionally a quiet month,” says Wells who hosted an online event for 800 Vodafone employees last month. “Virtual makes it easier to bring teams together too, especially for multinationals with offices across the globe. I think this is where the industry will go – these virtual events are here to stay.”

Encouraging outlook for the industry

So with the surge in popularity in digital events, could it be the beginning of the end for tightly packed music venues and sporting events? Gill doesn’t think so. “As a nation, we’ve always been big on live events, and that isn’t going to go away because of a virus,” he insists. “People are itching to return to the tangible, physical world. They can’t wait to pack into a football stadium and cheer on their team or get back into the mosh pit.”

Ultimately, Gill is confident that the sector will see a healthy return. Agile companies can weather the storm, as long as they diversify their offering and take advantage of government schemes and loans including bounce back loans, the Coronavirus Business Interruption Loan and the Cultural Recovery Fund offered by the Arts Council England.

“There is enough help and support out there for events businesses,” he says. “The pandemic will leave a scar which will take time to heal, but the industry will revive because demand will return.”

Mark Rowland is a journalist and former editor of Accounting Technician and 20 magazine.