Who moved my cheese: Is Singapore’s status as top Mice hotspot getting stale?

SOMETHING is brewing in the state of Melaka, over 200 km from Singapore.

There, David Toh, founder of home-grown events solutions provider The Ebenex Group, has big plans: to transform the sleepy town into a premier meetings, incentives, conferences and exhibitions (Mice) and live entertainment destination within the next five years.

To do so, he has partnered Malaysian real estate conglomerate Hatten Group to establish events company 828 Asia in a S$1 million joint venture. Already, 12 venue spaces – spanning more than 200,000 square feet in total – across Melaka have been secured for the project.

Organising a Mice event in Singapore has become more expensive today, and clients are starting to feel the pinch, says Toh.

In the past year, he has seen a 20 per cent drop in sales to stage Mice events here. This latest venture across the Causeway will help them capitalise on Melaka’s lower-cost base.

“I want to push some of these shows in another direction,” says Toh. “If clients are struggling to do it in Singapore, rather than forgoing it, they can consider Melaka as an events destination.”

Rising costs in events sector

Over the last two years, Singapore-based event management companies have received more requests from corporate clients looking to stage Mice events in other South-east Asian countries, as Singapore’s costs climb.

These events range from business meetings and smaller-scale conferences between 200 and 400 persons, to leadership summits and corporate retreats, players tell The Business Times.

According to their estimates, the cost of staging an event in Singapore has spiked by between 30 per cent and 50 per cent since pre-pandemic times. The biggest increases have come from venue rental fees and manpower costs, they add.

From the third quarter of 2023, corporate travel management company FCM Travel has seen a “significant” increase in enquiries from multinational corporations (MNCs) and local enterprises to compare costs of staging an event across various South-east Asia markets, in contrast to a year ago.

While Singapore saw a “huge uptick” in Mice events in 2022 following the easing of Covid-19 restrictions, it has since come down, notes Adam Piperdy, founder and chief experience officer of events agency Unearthed Productions.

“About 18 months post-Covid, some clients have actually come back to us saying they’ve explored venues in other countries, which might be a little bit more attractive in terms of costs,” he adds.

Since mid-2022, the Ebenex Group has received a 15 per cent increase in enquiries from clients seeking to move their Mice events from Singapore to other countries, compared to 2019.

This has been compounded by budget cutbacks in today’s macroeconomic environment, says Ebenex’s Toh – which has resulted in corporates staging “smaller-scale, watered-down events”.

“It’s a sandwich effect: costs have gone up in terms of venues and event production, while corporate budgets have been trimmed. So something’s got to give.”

Regional markets catching up

Other regional markets are emerging as viable Mice destination alternatives, with Thailand, Vietnam and Indonesia among popular lower-cost options for corporates, say industry players. Malaysia also remains a top option due to its close proximity to Singapore and weaker ringgit.

Since July 2023, FCM Travel has received 50 per cent more requests from companies to stage events in Vietnam, compared with the previous six months, says Wong Jing Wen, leader of FCM’s meetings and events arm for South-east Asia and China.

The overall operating costs of staging an event in these markets could be about 20 to 30 per cent lower than Singapore, note players.

According to hospitality group Marriott International, the starting rate for a full-day meeting package at JW Marriott Singapore begins at S$135++ per person – at least 10 to 50 per cent more than its regional equivalents.

A standard full-day meeting package includes basic audiovisual and lighting setup, two coffee tea breaks and one lunch.

Unearthed Productions found that holding its group town hall and corporate retreat in Bangkok was at least 30 per cent cheaper than if it had staged it in Singapore, all costs considered. The three-day, two-night event was held in January.

This included flying 60 Singapore-based employees and 10 others from Indonesia and Vietnam into Bangkok, four-star hotel accommodation, as well as a half-day meeting package with food and beverages, says Piperdy.

“You may have to pay for additional things; if the venue is not as upgraded, for instance,” he says. The group’s previous town-hall-cum-retreats were held in Singapore in 2018 and 2019 with a fully local team.

“But just based on estimates alone, you’re looking at saving almost half on hospitality and food.”

While rising costs are not unique to the city-state, the pace of these increases “appear to be faster or higher in Singapore than in other regional countries,” says Dylan Sharma, vice-president for advocacy and communications at the Singapore Association of Convention & Exhibition Organisers & Suppliers (SACEOS).

He notes that hotel prices in Singapore have risen “significantly” post-pandemic, while hotel room rates elsewhere in the region remain comparable to pre-pandemic levels.

Large groups therefore stand to reap “substantial” cost savings by travelling to cheaper destinations for incentive trips, he adds.

These markets are also doing more to level the playing field.

Countries such as Thailand and Vietnam have been ramping up Mice-related infrastructure in the last few years, by constructing more purpose-built convention centres and improving transport networks.

The year 2022 saw the sprawling WTC Expo open in the Vietnamese province of Binh Duong, with direct transport links to Ho Chi Minh City. In northern Bangkok, a linkway is being built to connect the Impact Exhibition and Convention Centre to the Muang Thong Thani Station, a future station on the MRT Pink Line.

“What you find in Singapore, you can also find in those countries – minus 10 to 20 per cent. But they have the time to catch up, and they have been catching up,” says Unearthed Productions’ Piperdy.

English language proficiency in the hospitality sector has also improved, he adds.

At the same time, regional tourism bodies have become “more aggressive” in bidding for Mice events to make up for the shortfall in leisure tourism – which has yet to recover to pre-pandemic levels, he says.

In 2023, the Thailand Convention and Exhibition Bureau unveiled a five-year plan to position Thailand as a premier Mice destination. Part of its strategy includes collaborating with government agencies to bid for events, as well as developing the identities of local cities and marketing new regions.

Resort cities such as Bali and Phuket are also turning into hot spots for conferences and summits, as more tech giants and MNCs opt for a “more casual” approach, observes Adri Satryawan Pratama, director and co-founder of events agency The Executive Group.

“Companies are evolving; they no longer follow fixed formats. We’ve noticed that people are not really in suits and ties all the time; they want to be relaxed in berms, shirts,” he says.

“So why do you need to have an event in a place like Marina Bay Sands, when you can have it at a beach resort?”

Smaller events may go, but bigger ones to stay

Even as certain events head abroad, the overall impact on Singapore’s economy will be minimal, say industry players.

This is because major trade shows, C-suite and high-level strategic events are likely to remain in Singapore, they say, given that cost is hardly a deciding factor in where these events take place.

“When it comes to trade shows, we look at the industry we serve and listen to our exhibitors’ feedback on where there is a viable market. We go where the buyers are,” says Yeh Chien Ee, president of Asia-Pacific at exhibition organiser RX.

A manufacturing trade show, for instance, would take place in a country with a strong manufacturing base, he adds.

But cost pressures will weigh more on smaller-scale events, which could include meetings, workshops and seminars, says SACEOS’ Sharma. He is also the co-founder and director at events agency Tricom Events.

However, beyond costs, some events will shift around the region as part of a “natural rotation” process, or to diversify their catchment pools, he notes.

Clients are more likely to explore holding their events elsewhere in the region if the majority of their attendees are not from Singapore, say players. This also applies for events that take place across more than one day, where overnight stays are involved.

However, not all industry watchers are convinced that companies will move their Mice events out of Singapore. Jesper Palmqvist, senior director for Asia-Pacific at hospitality research provider STR, is one of those who have “not seen a broader shift”.

And even if this occurs, he does not expect “any major impact in the grand scheme of things” if such events are not as high-yielding to begin with.

Likewise, SACEOS’ Sharma believes the outflow of these smaller events to the region “will not move the needle” for Mice contributions towards Singapore’s gross domestic product (GDP).

As Sharma sees it, Singapore will continue to remain a “strategic location for strategic events” – with its key value propositions lying in its safety, ease of transport, digital connectivity and lack of language barriers, among others.

“The impact of having 10 smaller events move out of Singapore, could easily be offset by having one higher-value event moving to Singapore,” he says.

In response to queries from The Business Times on recent Mice data, a Singapore Tourism Board (STB) spokesperson only said that the Republic hosted a “strong line-up” of such events over the past few years. Some notable ones last year were the Tax Free World Association Asia Pacific Exhibition & Conference, the 25th World Congress of Dermatology and Gastech 2023.

Prior to the pandemic, Singapore’s Mice industry supported more than 34,000 direct and indirect jobs with a value-add of S$3.8 billion, or close to one per cent of Singapore’s gross domestic product. STB did not reveal post-Covid figures.

Moving with the cheese

While the impact on the overall economy might be minimal, Singapore-based event management companies are not resting on their laurels. Instead, they are setting their sights on the rest of the region to capitalise on these demand shifts.

Both The Executive Group and Unearthed Productions have yet to see an impact on their toplines, but they are looking to cover their bases early on.

Since June 2023, Unearthed Productions has set up representative offices in Jakarta, Bangkok and Kuala Lumpur to assist the growing number of clients seeking to stage events there.

“We understand how the client has run the event in Singapore, and that they will want the same standards overseas,” says Piperdy, adding that this would be easier than working with a new overseas events vendor from scratch.

Similarly, The Executive Group is planning to establish offices in Jakarta, Bali, Kuala Lumpur and Bangkok from end-2024, says Pratama.

For The Ebenex Group, its bid to develop Melaka into a rival Mice destination and attract Singapore-based corporates is arguably more ambitious.

By establishing events company 828 Asia with Hatten Group, the idea is to sell an “entire integrated event experience that starts and ends in Singapore”, says Toh.

A Mice package, for example, could consist of round trip transport to and from Melaka, a one-night stay at a four-star hotel, and a ticket to a conference there. Yet the cost of this could still be 20 per cent lower than attending the same conference in Singapore, he says.

Corporates can thus stretch their dollar further, he explains, as employees or delegates can engage in sightseeing or cultural activities in a new city too. 828 Asia will be offering ticketed add-ons to some of these attractions.

In addition, a training academy in Melaka will be formed to train Malaysians for events-related jobs, such as a production crew member or events manager, says Toh.

“Rising manpower costs are a critical issue for our industry. Developing local talent will not only service the upcoming events tourism landscape in Melaka, but also create future opportunities for these Malaysians to head to Singapore for work.”

Since December 2023, Toh has hosted site visits to Melaka for about 10 to 15 groups of Singapore-based corporates and potential investors. 828 Asia is set to stage one Mice event and two live entertainment events in Melaka this year.

To retain Singapore’s competitive advantage as a Mice hub, Unearthed Productions’ Piperdy believes Singapore should repackage its offerings to delegates – such that it “becomes the business-to-pleasure lifestyle destination that they are looking for”.

This means intentionally interweaving cultural and leisure experiences with Mice events, he says; for example, by hosting a conference in the day, then bringing delegates out for a walking tour of a cultural or historical district – say, Haji Lane – at night.

“We’ve always been about pure business – come here, attend your conference, leave,” he adds. “It’s no longer about having a gala dinner in a hotel; you can do that in Bangkok or Kuala Lumpur.”

To improve its value proposition to clients, Unearthed Productions introduced local experiences – from a gin distillery visit to a Marina Bay cycling tour – in mid-2023 as Mice package add-ons. Piperdy plans to expand these offerings to coffee roasting workshops or food walking tours in the future.

“Coming to Singapore may be a bit more expensive than the region, but you’re going to get unique, better experiences you can’t find anywhere else,” he says.

“That should be our winning strategy to attract and retain events here.”