Of the extraordinary multitude of acronyms within the MICE industry, perhaps the most misunderstood is the one describing the professional conference organiser (PCO), writes Helen Brewer.
Those dreaded initials used so glibly by all and sundry, PCO. If one had to ask six industry individuals: ‘What’s a PCO?’, the chances are that six differing answers would be forthcoming. These answers would range from a highly experienced independent planner to someone with the right connections, taking the commission and doing a limited amount, if anything, to earn the agreed percentage. The term PCO is used by MICE suppliers (staging, decor and venues with meeting facilities) to explain any individual that places an order/booking and gets remunerated via a commission, after the order/booking has been completed.
There are a variety of other commission-payment permutations in what can be termed a love/hate relationship between suppliers and PCOs. The majority of suppliers, venues in particular, have plenty of time for PCOs simply because it’s a great way of getting business with no marketing expenditure and the venue only pays when the booking has been completed.
The dissenting voices of other venue personnel on PCOs concerns the amount of commission paid for conceivably little or no tasks being undertaken during the booking’s execution. And because there are no real rules and limited transparency of what a PCO should be doing – it’s open season. Anyone and everyone can claim to be a PCO.
If a PCO has a close relationship to a corporate, association or public sector individual who is booking suppliers either once-off or on a regular basis – it’s just too easy to split commissions between the one internally and the one externally, culminating in a very nice bonus for the parties concerned.
KNOW YOUR PCO
The MICE Academy believes it is the prerogative of the end-user/decision-maker who is contracting the services of a PCO to know the differences together with the various payment structures. Hence we chronicle the definitive PCO blueprint.
1. CONCEPTUAL TASKS:
a. Programme content:
• develop statement containing goals
• determine requirements to carry out meeting or event
• monitor strategic plan and sustainability/environmental management plan
• develop evaluation, project, theme, integrated communications and evaluation/audit procedures.
b. Marketing:
• conduct situational analysis
• define target market segments
• select marketing distribution channels
• implement marketing plan
• determine needed marketing materials for the event.
c. Risk:
• compliance and decisions
• type of risk
• insurance, legal and security.
Thereafter the event practitioner will ‘drill-down’ into the various extensive components of the marketing requirements.
2. LOGISTICAL TASKS:
a. Administration:
• develop budget
• establish supplier charges
• monitor budget performance
• manage registration procedures
• human resources
• develop selection criteria
• recruit personnel.
b. Design including entertainment, catering and set-up.
c. Operations including attendees, site inspections and technical requirements.
d. Risk including compliance and decisions, type of risk, insurance, legal and security.
Thereafter the event practitioner will ‘drill-down’ into the various extensive components of the logistical requirements.
Most important is investigating whether the PCO has indeed the experience and authentic references to undertake all or any of the tasks as required by the end-user.
3. FINANCIAL CONSIDERATIONS
Remember, professionals earn fees while agents charge commissions.
a. Fee structure
Whether conceptual or logistical (or both), an hourly rate dependent on the type of task should be levied together with time sheets in substantiation. The basis for ongoing payments needs to be part of the memorandum of agreement or contractual arrangements.
b. Commission structure
Unless the PCO is adding value to the selected suppliers services such as extensive coordination and on-site rearrangements, commission-structured payments as the main aspect of remuneration for investigating and/or selecting suppliers is fraught with complications.
For whoever is paying the PCO, the bulk of remuneration is determined as the client with the end-user deemed secondary to the organising task. The double-dipping aspects (that is fees and commissions from various suppliers for the same service) are a separate issue. Suffice that in many countries double-dipping is against the law.
ROUND PEGS IN ROUND HOLES
Will the various misinterpretations go away? It’s unlikely. What is important is that those tasked with securing the services of a PCO need to determine at the outset what their specific interpretation and, indeed, requirements for contracting a PCO are.
It’s a question of substantiation with total transparency between the stakeholders. Whoever initially contracts with the PCO is the only party responsible for the financial arrangements and hence the end-results.
Helen Brewer is a director of the MICE Academy. She has been involved in the MICE industry for over 35 years and has immense knowledge and experience to assist with best practice.
