The pandemic could force at least 50 percent of event management firms in Bangladesh to close
Md Jony (not his real name) owns an event management firm in Dhaka and offers logistics support including providing screens and sound systems for events.
Every month, he has to pay Tk1.5 crore in rent to accommodate his 3,000 LED screens and 100-spear sound boxes, worth Tk100 crore.
Unfortunately, due to the Covid-19 pandemic, all events around the country stopped in March. Left without any income, Jony finds it extremely difficult to pay the rent.
Moreover, he fears he will have to sell his assets as he sees no sign of recovering his losses any time soon.
Not only Jony's livelihood, but the entire event management industry in the country as well is currently at stake due to the Covid-19 pandemic. According to industry insiders, people like Jony, who are involved in logistics support for event management, will be among those worst affected.
Event management companies organise and operate mass gathering events for their clients, like corporate-funded concerts, exhibitions or large meetings like product launching and media events.
Ironically, one of the key requirements to prevent the spread of coronavirus is maintaining social distancing, meaning avoiding public gatherings.
While talking to The Business Standard, Mifta Arif, head of marketing communication at Watermark MCL, said his firm had to postpone 14 events in April. Usually, on average, his firm organises 200 events a year.
"Now that all the events have been postponed, business has come to a halt," he said.
"If anyone organises an event even six months after the coronavirus is eradicated, not many people will attend the event as social distancing will be a major issue in the future too," he added.
Watermark MCL holds about seven percent of Bangladesh's event management market.
"Our clients are businessmen, too, and almost all types of businesses have been affected by Covid-19. So, nobody is going to launch massive promotions such as organising events soon," says Mifta Arif.
He believes it will take around two years for the industry to recover.
"As of now, everything is uncertain for us. If corporates slash their marketing budgets, it will definitely affect our business. As everyone is having a dull business, cost-cutting seems unavoidable," said Manas Paul, executive director of Asiatic Experiential Marketing Ltd.
He said some event management companies have 360-degree solutions that involve digital marketing and creative inputs.
"They would be in a better situation as digital marketing can be done from home. But firms that are exclusively engaged in event activation will have a tough time ahead," he said.
Manas said the industry needs to figure out a new operational framework that can comply with the Covid-19 situation.
"Otherwise we cannot survive this situation," he added.
The Event Management and Marketing Association of Bangladesh (EMMAB) fears the outbreak could force at least 50 percent of event management firms in Bangladesh to close down.
The association made the prediction on Saturday at a meeting with owners of various event management firms who have expressed their deep concern over the fate of their employees.
As per the association, currently, there are 300 event management firms in Bangladesh employing around two to 2.5 lakh people and the market is worth around Tk2,000 crore.
The organisation also outlined a strategy to overcome the situation.
"Creating tax holidays, ensuring flexibility for repayment and deferrals on loan instalments, facilitating bank loans to have a very low or zero interest rate, deferring VAT payment, and reducing AIT to zero can help the industry survive during the pandemic," said EMMAB General Secretary Doza Alan.
"As the private sector will be left high and dry in regaining its momentum, the government can initiate and create projects that include marketing and event agencies to keep the ball rolling," he added.
Sarwar Morshed Azam, managing director of IMS said, "We all are following social distancing measures and staying at home to fight the novel coronavirus but we also have to think about the thousands of people, who work outside, for consumers and brands that have now come to a standstill."
Speakers at the meeting also said activities and events may be redefined with the new world order post-Covid-19, though at present they are not sure what the new world order will be.