Foreign Business Does Not Open Its Hand

19.01.2010 — Analysis

International business is rapidly advancing into the Urals region, though numerous exhibition centres in Ekaterinburg, Chelyabinsk, Perm, Tyumen, and Khanty-Mansiysk are hardly used for this advancement. "The problem is that over 80% of exhibitions held in the Urals Federal District are simply no more than image-building projects serving a single company at a time. The end consumer does not come to these events," thinks Yevgheniy Dubonosov, the Commercial Director of Ural Line Tour (a Ekaterinburg exhibition organiser).

Christophe Lormelle, the Representative of the French Economic Mission in the Ural Region, reckons that exhibition centres in Ekaterinburg remain too weak to attract attention of French companies. "We are waiting for a time when the implementation of the announced project for the construction of the International Exhibition Centre starts in the Urals capital. Associated services - catering, language translation etc. - also have to be developed," Mr Lormelle pointed out.

"The level of preparation and carrying out exhibitions in Ekaterinburg still remains regional and interregional," Roman Lorets, the Consultant at the Trade Council of the Kingdom of Denmark in Ekaterinburg, told RusBusinessNews. "Employees of Danish companies, especially from the small and medium size business sector are people with busy schedules and it is very important for us when inviting a company to take part in an exhibition to be certain that this participation will be interesting and useful for them."

As a rule companies working internationally are striving to be present at no more than one Russian exhibition of an appropriate profile. Naturally the choice falls to the events in Moscow and St Petersburg where the standards are immeasurably higher than in Urals megapolises. Nevertheless there are several exhibitions in the Urals which continue attracting a sustained attention of a great many a foreign company. First and foremost, these are the Nizhniy Tagil RusExpoArms and RusDefenceExpo. Foreigners point out the interesting subject of these exhibitions, their international calibre and the good standard of organisation. In its turn, Russian Economic Forum held annually in May in Ekaterinburg attracts foreign consulting companies.

"Every year our organisation conducts more than 20 exhibitions with participation of foreign companies," Irina Borisenko, the Head of Marketing Department of Ural Exhibitions, the leading exhibition organizer in Ekaterinburg, told RusBusinessNews. "Construction and industry exhibitions are proving most popular among foreign companies. In recent years the spheres of real estate and tourism are also developing rather lively. Having come to our exhibitions once enterprises often come again the following year inviting their colleagues for the collective display.

So far, however, exhibitions with foreign participation are only capable of attracting just a few foreign companies. Jana Brzoňova, the Director of the ChezhTrade agency office in Ekaterinburg, informed RusBusinessNews that "Before the agency managed to organize the participation of Czech companies in two-three exhibitions in Ekaterinburg every year. So far the funding for only one exhibition, StroyMashUral, in the first half of 2010 has been confirmed. I think that in the second half of the year we will also participate in the energy sector exhibition."

"Our experience shows that only a single Austrian company participated in Ekaterinburg in the exhibition "Clothes, Fashion" in 2009. And even then this participation was a remote one," Anna Kovalchuk, the Head of the Austrian Marketing Bureau in Ekaterinburg, pointed out for RusBusinessNews. "We have lists of Austrian companies with contacts categorised by sectors. Exhibition organisers can mail invitations to them directly. However, in order to organise a collective Austrian stand at a Ekaterinburg exhibition you need to be at an international level, you have to have collective stands from other European countries."

The construction of a large international exhibition centre in Ekaterinburg is still at the project stage. Moreover, a Russian-Chinese trade and exhibition centre is planned for construction here; the total area of the centre is going to be 600 thousand square metres with 630 million dollars of investments. The ambitious project of construction of international exhibition centre is being developed in Tyumen. According to plans the complex with the area totalling 50-70 thousand square metres will be housed on 15-30 hectares. It will specialise in exhibition and congress events in the oil and gas sector. The common feature of all these announced projects today is the lack of investors or implementation deadlines.

So far foreign companies use other means of promoting themselves in the Urals. Cooperating with diplomatic and trade representations of their countries and with the Urals, South Urals, and Tyumen Chambers of Trade and Industry, they take part in one-off mini-exhibitions. As a rule these include 10-20 exhibitors from one particular country. These events are held in halls of public buildings and do not differ much from a flea-market in terms the level of civilisation. In the recent couple of years companies from China have been actively using these practices in Ekaterinburg, Chelyabinsk, and Tyumen.

Some Urals exhibition organisers have already noted the trend and now are trying to organise events in specialised exhibition centres and categorise not only by sector, but by country too. Yevgheniy Dubonosov said that "In April 2010 we decided to hold the first exhibition/conference Ural-China Business in Ekaterinburg to facilitate links with Chinese business. We hope that this event will become a regular biannual function. We picked the Chinese because the Celestial Empire is our most economically powerful neighbour. Last year a direct scheduled flight has been started between Ekaterinburg and Beijing. It is also significant that we have the Chinese Consulate General in Ekaterinburg".

Urals Exhibitions is planning the Days of Bulgaria exhibition in Ekaterinburg in 2010 which will present real estate and tourist resorts of the Republic. It is also planned to organise a forum with the participation of Flemish companies this year.

Nevertheless the Urals will not be able to get away from exhibitions being industry-specific, in tune with the common global practices. The Ekaterinburg, Perm, Chelyabinsk exhibitions will have hard time trying to catch up with the organisational standards and the number of participants of similar events in the capitals. This is why experts think it might be a good idea to have joint exhibitions - starting a large exhibition in Moscow with the following continuation of the event in Ekaterinburg. In this case the needed international standards will be assured and the regional specifics accounted for.

Pavel Kober