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IAFE Gauges Impact While Developing Plans During Covid-19 Crisis

Crowds Gather at the 2019 Minnesota State Fair
In 2019, the Minnesota State Fair broke yet another attendance record, attracting over 2,126,551 visitors. In 2020, the fair will host zero following the fair boards decision to cancel the event amid COVID-19 concerns.

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Everyone now longs for a fair season where weather was the main concern.  With a global pandemic wreaking havoc in every sector of the economy, the major concern is whether or not there will be a fair industry once the crisis passes.

With the year more than half over, Carnival Warehouse thought it was time to measure the impact on Fairs – what is the extent of the loss right now and what will that impact be in the foreseeable future – and what better source for insight on the fair business in the aggregate than Marla J. Calico, President & CEO, International Association of Fairs & Expositions (IAFE).

In a strange irony, even though fairs – and many IAFE events – have been cancelled, Calico's job may be more hectic than if the season was in full throttle. What fairs are cancelling, what fairs are opening under new restrictive guidelines, and how will the COVID-19 pandemic continue to effect the industry into 2021 – are questions that we may not have conclusive answers now, but are sparking conversations and speculations that will lead to decisive actions when the time to take those actions comes.

The reason to gauge the industry now is clear. Whatever can be salvaged for 2020 in the fair industry started in July, as many states went into a third phase of re-opening that included public spaces and a handful of fairs.  By now, a majority of fairs have cancelled, but hundreds of fairs are still in some form of fair limbo – the final decision to open the gates or go dark has yet to be made.



Of course, even the fairs determined to hold some sort of event in 2020 can only do so with the approval of state and local health officials. The destiny of fairs is really out of their hands.

But the toll already taken on the industry is staggering to consider.  IAFE members are responsible for 1,098 fairs or other events annually, 48 were able to be held in 2020 before the lock down began in March, when the Houston Livestock Show & Rodeo was shut down. Since then, more than 500 have been cancelled outright, and another 550 events have not yet been cancelled, although 300 of those seem likely to be cancelled, according to IAFE sources.

What has been the economic loss? While final figures are not yet available, what we do know is that in 2019, U.S. fairs generated $4.67 billion in economic activity, according to a report by Markin Consulting the IAFE authorized. With approximately 800 fairs likely not to be held this year, the economic loss already is in the neighborhood of $2.5 billion.  

The situation is grim and the crisis has yet to pass. Spending some time with the head of the largest association of fair professionals at least gives us an honest assessment on the impact so far, and what the short and long term future prospects for the industry are.

Carnival Warehouse: It must be a very difficult time for you.  How have you and your staff been coping with the lockdown?


Marla Calico: We have 12 full time employees, two of which do not live in Springfield and always work remotely. We had a contingency "work from home" plan ready by March 5 or so and implemented that when our county mandated it in mid-March. We returned to the office when the order was lifted the first week of May. Everyone has separate offices and we have no outside visitors, so it is simple for us to be safe in the office. For us it is not coping with the lockdown but coping with the resultant stress of what is happening to our members. Our team has to put aside any stress in their personal lives (kids at home, impact to a partner or spouse's job, etc.) in order to answer the call to serve our members. Reminding everyone on our team to take personal time and take care of themselves is critical and we also try to have strong internal communications.

 

CW: Has the IAFE had to furlough any staff or implement any cutbacks due to the pandemic?

MC: No, we have not cut back on staff. In reality, with what we are doing to serve members we cannot afford to! Everyone is working as hard and as efficiently as they can every day. We have implemented several cost-cutting measures in operations, though. The board of directors has authorized the use of reserve funds, clearly stating that this is the "rainy day" for which the funds have been held.

 

CW: Have you lost any members, dues or other financial support due to the pandemic?

MC: We have actually gained members.  We have new associate members –those with the new products and services needed by the fairs, carnivals, and concessionaires (i.e. sanitizer, masks, virtual livestock show platforms, etc.) And, we've had some new fair members who are very much appreciative of the resources available only to members, even though we have a lot of resources available on our public-facing page.

 

CW: What are the most common issues your fair members need help with from the IAFE?

MC: Liability concerns and insurance concerns are all part of trends of concerns in April-May-early June as fairs were trying to consider going forward or not. Communication – how/when/what regarding status, decision-making process, dealing with the horrible social media backlash, etc. hat continues, and how to drive revenue when you can't have events, or are limited in size/scope of events. The top concern now is what 2021 will look like.

 

CW: How did the IAFE respond to the concerns your members raised?

MC: Initially, we made our website and our dedicated pages for communicable disease the centralized location for information (from WHO, CDC, DHS, etc.). Then, in less than 14 days, by mid-March, we had created "Let's Talk" discussions – connecting members in live discussions, of groups from 10 to 300, using conference calls as well as video conferencing. Initially the sessions were just facilitated sharing of ideas and situations, and that still continues to some degree, but we began to move into focused topics and speakers, depending upon the need. In this area of activity, we have truly lived up to our brand –"The Network" as connecting people to each other has been critical. Since March 17 we have facilitated over 120 separate sessions, with over 6,000 participants.  We also provided our technology and staff expertise to the state associations of Indiana, Iowa , Illinois, Kansas, Missouri and the Dakotas (the recently formed Heartland Association)  to host/produce video conferencing discussions for their own members so that they could address specific concerns within their states.  

Working with our Zone Directors, we helped to coordinate virtual discussions for Zones 1, 2, 3, 4, 5 and 6. Finally, and by far the hardest and most stressful things we do is facilitate small group video conference sessions for folks from fairs that have cancelled. We typically do three sessions per week and they are private sessions where the folks can grieve and share. Because the grief is real. Unfortunately, those sessions will be needed farther into the future than I care to imagine.

Finally, we created a "goods and services" page for our valued associate members which have products and services especially needed by fairs in this crisis. That is a free service to our associate members.

 

CW: For fairs that have cancelled, how certain are they of having a 2021 season?

MC: The only thing that is certain in this horrible crisis is the uncertainty. No one has any certainty about the future.

 

CW: What is in store for the IAFE, your meetings and your annual convention? Will they be cancelled, held virtually, or held within CDC and Local/State guidelines?


MC: We had to cancel seven meetings scheduled between March 9 and May 10 – this included Zone meetings, the Management Conference, the Executive Summit for State & Provincial Associations, and the Institute of Fair Management Summit. The IFM Summit, however, was converted to a virtual conference which was a huge success with even more attendees than what we would have had at the live event slated to be held in South Carolina.

The IAFE Convention is scheduled to go forward, as of now. We have issued contracts for around 200 booths in the trade show. Hotel reservations have opened in a tiered manner according to sponsorship level; all hotel reservations as well as Convention registration opens July 27. 

What we have heard from our members – fairs and associates – is that we NEED to be together and we NEED to be together in person if at all possible. We know there will be many people who simply cannot attend – whether fair or associate – their business is in peril. Others may not feel confident to travel. Our team has developed a plan that will allow folks at home to participate in many sessions (live as well as on-demand) and to network virtually. Of course, we must also be prudent and will have ready to launch if necessary, a totally virtual event should that become necessary

 

CW: Some fairs and outdoor events have opened, although it's unclear how many are IAFE members. As this rollout begins, what signs are you looking for that might determine the rest of the season?

MC: The most hopeful and positive sign would be that in a community where a fair (with all the elements of exhibits, livestock shows, grandstand/arena events, carnival and concessions) has operated that in the two weeks following there is not a spike in COVID-19 cases there. Personally, I think that would begin to ease concerns about "mass gatherings". Importantly, everyone will want to know (a) the reaction of the crowds – will they practice social distancing and wear face coverings, (b) the financial results – what was the spending level in all areas and what was attendance, and (c) the reaction of the community as a whole (was there support, outrage, controversial statements from officials, etc.

 

CW: What is the "New Normal" for fairs?

MC: It seems likely that social distancing, face coverings, and rolling waves of lockdowns in a patchwork across the country will be a part of our existence for some time. I have no hope that the inconsistencies of restrictions and mandates across regions and even within states will be resolved.  There will not be a "normal" because of the particular impact on the live event and meeting industry. Fairs rely heavily upon non-fair facility rentals – gatherings of people, the majority of which are large – and it seems that will be very slow to return.

CW: What area of the fair seems the most problematic in terms of opening under CDC guidelines and how is the IAFE helping to address those concerns?

MC: The CDC only released any sort of guidance directed to fairs in the last two weeks [July 4th weekend] and those guidelines are not the issue. It is the inconsistency, the patchwork of restrictions and mandates made by the over 2,800 county health departments across the United States. Or, in some instances a state authority.  In one state it was "touchless" fixtures (i.e. faucets) in the restrooms – no fair can afford to go in and retrofit all of their restrooms. In another state, it is the limit of 175 people in a designated activity area even when that space is 30,000 square feet.  In some states the University Extension (all 4-H programs run through that) has mandated such intense restrictions on 4-H livestock shows (collect all contact info, limit number of family to attend, limit time on grounds, etc.) that it is simply impractical to go forward. While at the same time, a livestock event organized by a private group or individual is taking place elsewhere in the same county without any restrictions.
 
Finding a disinfectant approved by the EPA to kill the coronavirus that works fast is proving to be problematic.  Some fairs, even moving forward with just youth livestock events, are finding it very difficult if not impossible to secure necessary cleaning supplies.     

In most fairs, if allowed to go forward, the ability to modify layouts of carnival rides, games and independent concessions in order to have safe queue lines will be very problematic. Typical practice over the years is to use every inch of revenue-producing space as effectively as possible and that simply does not allow for "social distancing" practices.

 

CW: Are there fairs that will go out of business because their 2020 event had to be cancelled?

MC: It is sad to even think that, but it is likely.  Right now, the situation for fairs in California, the majority of which are state entities known as District Agricultural Associations, yet self-funded, is precarious and very serious. The California Fairs Alliance has initiated a campaign in that state requesting $300 million in state or federal aid. In the rest of the country, though I do not have specific instances to quote, it would appear that there might be some small county fairs at risk of closure.

 

CW: The fairs that will be held in 2020, how will they be different? What will stay, what will go, is there any consensus you can ascertain?

MC: That is unknown at this point in time. We've yet to see a fair of any size be allowed to go forward.

 

CW: The country is in a recession, unemployment is high, how do you feel this will impact fairs and are fairs offering more price promotions, even free gate admission, to respond to the current economic conditions?

MC: At this point, the priority is to just get open. Most fairs haven't gotten to the point of assurance of opening to determine any final marketing incentives that might be needed. It appears to me that there is pent-up demand and even with the recession and the horrible resulting crisis to so many people in this country, that if a fair can get open, people will come out.

 

CW: Fairs rely on sponsorships, have you any sense of how big an impact the economic downswing is having on sponsorships and is there any way for a fair to minimize that impact?

MC: The full impact will not be felt until next season. For fairs which have cancelled, most are finding sponsors still to be supportive. Almost all fairs have offered to roll the contracts forward, some have offered refunds, but the sponsor has said just keep the money for next year. There may be a silver lining in sponsorships for fall fairs if allowed to go forward in that sponsors may have dollars to shift from other endeavors, such as college or professional sporting events.

 

CW: For the fairs considering whether or not to cancel 2020, what is your advice and/or opinion?

MC: There are so many intricacies to the decision-making process, and so very unique to each individual fair, that the best advice I feel we can give is first, communicate. The fair needs to be in constant communication with the local (or governing) health authority, their carnival provider, all commercial exhibitors and concessionaires, their sponsors, and the community. When I hear that a fair has not even established a relationship with their county health department, I am very concerned. When I hear a fair has made a decision without even talking to their carnival operator to see what ideas and solutions they might have I am very disappointed. The second piece of advice we can offer is that the fair MUST make the decision that will allow the organization to continue to produce fairs for their community for future generations.  And to be prepared because that decision will not be unanimously accepted. A fair choosing to go forward will be condemned by some in their community for taking too big of a risk with health and safety. A fair choosing to cancel will be condemned for not allowing the kids to see their 4-H and FFA projects culminate.

 

CW: Any ideas of what to expect for the 2021 fair season? What will be the lingering impact on the fair sector of the pandemic?

MC: There is far too much uncertainty to even try to speculate on 2021. The lingering impact will be how long it takes to recover financially, especially the longer it takes for non-fair rental activity to commence at typical levels. We did a survey in mid-March, and from just 320 fairs (that is less than 30 percent of our membership) we know that there were more than 10,700 events (not fairs) cancelled just for the period of March through May, resulting in estimated loss of revenue to the fairs of $22 million per month.
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