The other principal means of achieving organic growth in return for a comparatively small outlay is spinning off a niche exhibition from a definitive, a process which Blenheim calls "fractioning". This has a double advantage where the parent exhibition is biennial of filling a hole in the off-year. For example, the definitive French construction industry exhibition Batimat has spawned Batimat Decor (interiors), Batimat Industrie (industrial buildings) and Equip'Baie (windows, doors and shutters). Yet further growth should come from milking existing exhibitions by means of add-ons: for example, by the simple but profitable expedient of introducing entrance charges for visitors. Other add-ons include rakebacks from stand constructors and commissions on travel and hotel bookings, plus exhibition programmes and newsletters.
The databases of exhibitors and visitors are a potential goldmine. Blenheim retains absolute control of its databases and can use them for cross-selling between exhibitions. It is also in the process of expanding its publishing arm under UK chief executive Phil Soar, as its database holds a captive market. There are currently 14 trade magazines, but Blenheim plans to raise the total to 25 in the next two years to complement its exhibitions. But, says Buch: "They will never account for more than 10% of profits: we're an exhibitions group."
Given the present state of the world's economy, management's preoccupations cannot be confined to growth. In the aftermath of a period of rapid expansion, Blenheim has lately taken steps to consolidate its businesses and cut costs, particularly in Britain and France. In Britain, 13 operational divisions, eight locations and 180 staff have been reduced to seven, three and 150 respectively. In France, staff were cut by 17% while 10 locations have become one in west Paris.
Even so, the signs suggest that there is plenty of growth to come. One beauty of the exhibitions business is that it is repetitive, and so can be tracked very closely given adequate financial and management information systems. An earlier criticism levelled against Blenheim was that it lacked the required systems. Now, thanks largely to the efforts of UK chief Soar - and a £2 million investment - the state-of-the-art systems needed to maintain the group's momentum and direction in the next decade are in place. These enable management to project revenues and profits up to three years ahead, and should help Blenheim to steer a straight course as the next century approaches.
As for the present, Buch maintains that the current depressing state of the UK economy will have little effect on Blenheim's operations: by the end of the first quarter, two thirds of 1991 revenues were already realised or contracted. Lewis chips in: "The company which cuts back on exhibitions expenditure when times are hard will find his share reduced when conditions improve again."
The logic is infallible, but it is one which companies find depressingly easy to ignore when the going gets really rough. Buch also believes that he has insulated Blenheim against recession by spreading its operations across Europe. That can only be for the good as long as the whole western world does not catch a chill. The usefulness of insulation depends in part on how cold it gets.