• April 5, 2021

Agency leaders on… selling, resources & IR35 challenges

Agency leaders on… selling, resources & IR35 challenges

Agency leaders on… selling, resources & IR35 challenges 900 600 micebook.

UK event agency leaders discussed sales, RFPs, venue availability, resourcing issues and IR35 challenges during our latest forum last week.

Agencies including OrangeDoor, Yellow Fish, Touch Associates, Identity, DRPG, Smyle and The Live Group took part in the hour-long discussion. Here are some of the key viewpoints shared…

Sales & RFPs

“There are contracts going out now and RFPs for global corporates. Companies are sending out RFPs but the issue we are finding is the RFPs are all for live, but the reality is probably for the next 10 months, the vast majority of events are going to be hybrid or virtual, but we are being asked to deliver an RFP on live events, which is all a bit odd.”

“There was a period in 2020 when clients had time to engage with suppliers. They favourably dated a lot of new agencies last summer. We got a chance to get a foot in the door with a lot of potential clients as they were not running events. Our business development team said it’s getting a lot harder now. Those doors are starting to close as those clients are starting to get busier planning a return of some form or another.”

“I get a bit nervous about encouraging clients to get back to face-to-face. We are starting to see more clients sending through briefs and we are responding to the best of our ability whether it should be virtual, hybrid or live. We have just won an event off the back of an RFP and we actually pitched a virtual event, whereas the other agencies pitched a live event. We won because we could show that we were meeting the objectives far better than if everyone was travelling, and that’s for next January. I think as an industry, we have to bite the bullet and be the ones to say to our clients, and certainly if you are on master services agreements, that at least 50% of all the events you run could be virtual… I fear there are too many people in our industry saying we must go back to face, it’s the only way to communicate effectively. It’s not and the last year has proved that.”

“We have started offering a ‘channel hop’ in our sales process. Clients can book a virtual but if they want to switch to live, they can do it at no extra cost. Clearly there is going to venue and an external cost, but for internal resource, you can switch between the channels and there is no extra cost.”

Venues & resources

“When people do come back to live, where the hell are you going to find a venue? I think there is going to a massive rush for people wanting live events at fairly short notice, and my big panic is we can’t secure venues on a what if scenario. I think everyone is going to be scrambling for venues at really short notice when it comes back. I know different countries will be coming back at different stages, but when it happens, it will happen quickly. I think we are going to be on the phones to all the hotels doing whatever we can to try and get in there and get the availability we want.”

“I don’t think it’s just venues. I think everything in our industry is going to be in short supply. So many companies have cut back, freelancers have left the industry, maybe for good. Part of our sales strategy has been going to clients and having honest conversations and saying you need to get things booked in, prices are going to rise, and there is going to be a shortage of resource.”

“Right now, trying to convince clients to think about 2022 and get it booked in, is a real struggle. They don’t want to think it about it till later. But I agree it’s going to be one mad rush at the last minute and then they are going to be disappointed they don’t get their first choice of venue on their first choice of date.”

“I’m quite intrigued by everyone thinking there is going to be a massive bang. I don’t know what data you are basing that on. I think your individual industry sectors will react differently, as well as different regions. If anyone thinks they can see further than three or six months down the line, then you are unique. Because individual governments can’t, scientific experts can’t. The only thing we have to latch onto is the vaccination programme, and that is not 100% definitively going to solve the Covid crisis. We will live with it long term. I agree there will be a squeeze in capacity that will potentially feel like an increase in demand. I am hearing a lot of hotels are downsizing. The market has changed so any gauges you had beforehand to return, doesn’t mean it will restart in the same way.”

IR35 issues

“Up until recently we have contracted several permalancers, so freelancer producers to work on three or four projects over a period of six months especially on the virtual side. That is very clearly an IR35 scenario, and we are playing by the book but some of the contractors are pushing back and don’t want to be employed on a PAYE basis. Understandably, a lot of people who work on a freelance basis don’t want to be taxed at source, so will now only contract for one job at a time and won’t now do two back-to-back jobs, which is a challenge. We are finding it hard to keep everybody happy.”

“This is very much a topical issue for us. There is a dichotomy between large and small agencies. Smaller agencies will benefit from this window till April 2022. We are watching and waiting to see how the large agencies react to this. We did some stakeholder engagement and reached out to our freelance network and they themselves don’t know. If a freelancer earns an average £400 day rate, and they move over to PAYE, they are quite significantly out of pocket. If they want the same take home rate, that will be £600 a day. If you have built up trust with a freelancer and you want them, then they can almost hold you over a barrel. I don’t think there is any easy answer. It really is a case-by-case basis. You have to sit down with each of them individually and work it out. It would be good if there was some steering group within the industry to help maintain a stance – if we move to the employee model, is the industry standard that there will have to be a 20% uplift on the standard day rate?

“We have been talking to some our permalancers about trying to bring them on full time employment. If they do more than so many days over a year, then we would want that as a full-time job anyway. We sit down with a freelancer and see what their income is for the year, and when some of them work it out, they are just as good going on PAYE because they would normally have down days. We had a difficult conversation with one who wanted all the benefits of PAYE and all the benefits of being a freelancer as well, so we decided to walk away from that relationship. It has to be fair to the full time employees too.”

“None of us really know what this industry is going to look like in six- or nine-months’ time. We are in danger of becoming hire and fire agencies if we hire all these people on a full-time basis on the virtual side, will we still need them all in 10 months’ time? We just don’t know.”

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