the September 2008 Issue in PDF Format - Trade Show Executive

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Power Lunch MIKE RUSBRIDGE Aiming to Double Reed’s $1.4 Billion Exhibition Business Mike Rusbridge is chairman and CEO of Reed Exhibitions Worldwide, based in Richmond, Surrey, UK. He joined the company in 1979 and became managing director of Cahners Exhibition Group, Ltd. (part of Reed Elsevier) in 1982, chief executive of Reed Exhibitions Europe in 1988, president of Reed Exhibitions Europe and Asia in 1994, and chairman of Reed Exhibitions Worldwide in 1996. He has guided the company to unparalleled global success, overseeing a dramatic expansion of Reed’s presence in the emerging BRIC economies (Brazil, Russia, India and China) as well as in the Middle East and Latin America. We spoke two days before he left for a safari to Zambia with his family. 20 September 2008 Trade Show Executive www.TradeShowExecutive.com
Bob: Reed Exhibitions Worldwide has experienced phenomenal growth under your leadership. How have you structured the company to achieve this? Mike: First and foremost, we are comprised of local teams serving local markets, which need to be quick, adaptive and entrepreneurial. Our competition is often not from other large organizers, but rather from local and national companies. We have regional presidents covering the world, reporting to me, as well as offices in 39 countries with 2,600 employees running 500 shows. Bob: What is your revenue breakdown, vis-à-vis organic growth, acquisitions and launches? Mike: Revenue increased 42% over the last four years. That breaks down to 38% organic growth, 12% launch, 15% acquisition and 23% going the other way -- divested business. Bob: Do you have an in-house “Incubator Team” for acquisitions? Mike: Not really. We average about 8 to 10 acquisitions a year, investing between U.S.$150 to 200 million annually. We have a central team here that acts as a filter for 20 or 40 different properties that we are constantly evaluating, which includes financial, legal, etc. In the majority of cases, however, the management teams around the world drive our acquisitions – it’s truly a “flow up” system. Bob: What about entering new markets or territories? Mike: A team that reports to our commercial director does the bigger deals here and I get involved with final approval. Bob: What do you look for primarily? Mike: We’re after a strategic fit with the 47 industry sectors where we have developed – or are developing – a global event network. We acquire for the long term, unlike many businesses funded by venture capital, which look for a three to five-year return. We look as far out as we can, comforted by Reed Elsevier’s financial backing. We are constantly seeking high quality, market-leading events with good sustainable growth as well as excellent management. Bob: How important is the management team in an acquisition? Mike: One of the things that could be a deal breaker is the quality of the management team and whether they will stay on board. I would be less interested in an event or company if we felt that within six months, we could lose those people who developed that business and have the market reputation, knowledge and intelligence. We have been very fortunate in most of our acquisitions to retain the management. Also, I am always interested in opportunities where we can add to our own management team. Bob: What about your launches? How quickly can you tap into a new market opportunity? Mike: Ideally, we look at a minimum launch time of 12 months out, but preferably 18 months out. We have launched a few shows in six months’ time to gain a competitive edge or when our research identified a strong immediate need. Bob: How many shows do you launch each year? Mike: Historically, we have launched between 30 to 40 new shows a year. This year, we’re probably going to launch 25 to 28 events that will come from our show teams in particular markets. Approximately 50% will be brand extensions. We’re also looking seriously at green themes. Bob: Can you give an example of a brand extension in a new region? Top of their Game. Mike Rusbridge (right) and Alastair Gornall, chief executive of Reed Exhibitions UK (left), are part of a team that has built the $1.4 billion company. Mike: Virtually our entire manufacturing portfolio has been migrated to Asia or the BRIC economies. We now have 40 events in China, including electronic manufacturing, packaging and others that began elsewhere. We’ve done this by tracking major industry shifts and moved our events accordingly. Timing used to be quite flexible, but today’s window for accepting an event is quite precise. Bob: I have observed that this migration has been integral to your success over the years. Mike: Looking at the West, meaning the U.S. and Europe, versus the rest of the world, Asia and the BRIC countries were 9% of our total business 10 years ago. Today, they are over 20% and will grow to 30% within the next few years. Another part of our success is the ability to see things multi-dimensionally and define what industry sectors and geographies we want to be in and then create events where our skills match these goals. I think we’re good at doing this. Bob: What are the main global challenges to Reed Exhibitions today? Mike: Being in 47 industry sectors and 38 countries gives you a greater resilience to the vagaries of the economy. Short of everything being down, as it was back in Continued on page 22 www.TradeShowExecutive.com Trade Show Executive September 2008 21
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