As Time Goes By

Every streak comes to an end. Time and trouble eventually caught up with Lou Gehrig, Cal Ripken, and even the Harlem Globetrotters. This spring they caught up with me.

I had attended every spring trade show produced by EDmarket (formerly NSSEA), from the very first such event in 1988 through the 2015 EDexpo in Atlanta. Although I had reservations and plans to attend this year’s show in Las Vegas, at the last minute I opted out.

In retrospect, it would have been a good idea to contact people, including the association staff, and let them know why I wasn’t going to make it, but I really didn’t think anyone would notice that I wasn’t there. As it turned out a lot of people did notice, and some of my friends somehow leapt to the conclusion that I must have a life-threatening illness.

The truth was a lot more prosaic. I was having a problem with flooding at my house, and was trying to get contractors to come in and figure out what was causing it and how it could be fixed. If I didn’t deal with it quickly, I was afraid it might get a lot worse.

To be honest, a problem like that would not have kept me from attending a school supply convention in the past. Over the 40 years I’ve worked in the industry, there were plenty of times when a show was not convenient for whatever reason, but they were all simply too important to miss. In 2005, for example, I attended EDexpo in New Orleans a couple of days after my father had died.

That show seems like yesterday to me, but (to state the obvious) it was not. The show, the industry, the culture and I have all changed pretty dramatically since then, more slowly but no less surely than New Orleans itself.

In 2005, there were 429 suppliers exhibiting products at the New Orleans Convention Center, taking up 874 total booth spaces. Five hundred and forty-six dealer companies brought 1,203 employees to shop those booths. I was just starting my second stint on the association’s board of directors, and the hot topic was how to control the number of exhibitors.

Imagine that. Your biggest problem is that you have too many customers (so 2005). Even with all those dealers walking the floor, there were so many booths that at any given moment a lot of exhibitors were standing around talking to each other, and the association worried that they would become disenchanted with the show. Raising booth prices might reduce participation, but the more palatable solution was to choose venues with a limited amount of space and let them sell out.

By the time I became chair of the association in 2011, that whole paradigm had been turned on its head. Between the Great Recession and the consolidation going on in the dealer channel, the number of exhibiting companies at the 2012 show in Baltimore had been knocked down to 292, and dealer companies to 316. It wasn’t that the ratio had gotten better (it was actually worse), but we had finally realized that the show was about buyers, not sellers.

At that point, the prevailing sentiment on the board was that we needed to find a way to rebuild dealer attendance, or the support of manufacturers would eventually
collapse. So we set about adding features to the convention that would be more beneficial to dealers, and reaching out more to the dealers who were not attending.

A friend of mine on the board remarked to me at the time that perhaps we were looking at the problem the wrong way about, trying to make the show the size it used to be rather than making the show the size it ought to be. “Maybe,” he said, “we should hold the whole thing in a ballroom.”

He wasn’t suggesting that the industry was in decline, or that a tradeshow was not important. He was simply recognizing that the distribution channel was changing. We all knew that, of course, but I sometimes wonder if we ever stop to consider what drives the whole process. Rounding up the usual suspects, like the Internet, the big boxes, School Specialty and direct marketers, does not explain why they come into play.

When my grandparents were born, more than 40 percent of Americans worked in agriculture. By the time I was born it had dropped to about 10 percent, and today it is less than 2 percent, and yet the output of food in the U.S. is many times what it was a century ago.

The same thing is true with manufacturing. Although there is a common misconception that we don’t make things in this country anymore, we are actually producing more goods here than we ever have. We are just doing it with fewer people. Over the past 20 years, manufacturing employment has dropped by 29 percent, while output has increased by 47 percent.

At the moment of the 2005 EDexpo, my own company produced four magazines with a staff of about 14 people. Today we produce seven magazines, plus a variety of convention programs, membership directories and other publications. The staff now consists of 12 people.

These increases in productivity are critical to the growth of the economy, but if productivity increases faster than demand it results in fewer jobs (and companies). That effect is happening right now in most industries, both here and abroad. Even countries like India and China are facing steep losses in manufacturing employment, and those nations lack our ability to absorb those workers into other sectors of the economy.

Now for the good news. If my premise is correct, that the reduction in the number of school supply dealers is largely the result of increasing productivity, then it stands to reason that you are working for a highly productive company. Congratulations.

I realize that evolution doesn’t stop, but it does go through periods of rapid change followed by periods of relative stability, and we have certainly gone through a period of rapid change. While businesses were becoming more efficient over the past decade, the culture was also going through a transformation, led by the two-headed monster of smart phones and social media.

So now we have a new school supply industry, made up of survivors from the old industry, leaner and meaner, plus Internet merchants, major chain stores, independent contractors and specialty retailers from related categories. All of them are hungry.

To address the new reality, EDmarket produced the downsized, self-contained EDexpo this past March. I think it was the right move, and all the participants I’ve asked told me that the show worked.

I learned a long time ago that in business, bigger is not always better. I also learned that it’s important to show up, come hell or high water.

I’ll see you at the next show.

by Kevin Fahy

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