The very next day its owner, MCH Group, communicated the correct decision that the exhibition had been postponed to January 2021.
These decisions are not made on a whim after a rant from WatchPro. They take time because accountants, lawyers and myriad stakeholders need to be consulted. But, ultimately, a group of directors discuss the issues around a boardroom table for a few hours and make a choice.
The problem is that the right choices often get ignored when the lawyers and accountants get involved, and this appears to be precisely what has happened when it comes to the subject of refunding deposits for exhibitors who had booked into the 2020 fair.
First, lawyers will explain that postponing is by far the better term than cancelling, because it means the default setting for exhibitors is that they are already booked into the show when it eventually takes place in 2021.
This pushes the onus onto the exhibitor to say whether they still wish to participate in what is effectively the same show (just the date has changed, and that is something well covered in contract law).
If they wish to cancel participation in the 2020/21 event, they lose their deposit, as would be the case if they withdrew from a show that was taking place as usual. MCH Group is reportedly holding over CHF 20 million ($20m) in deposits for this year’s show. At a time when cash has never been more vital to any business (including MCH Group) both the exhibitors and the organiser want this money.
Rather than handing over the CHF 20 million, MCH Group wants to hold onto as much as possible. But at the same time it needs exhibitors to confirm they will participate in 2021, so they offer to convert the 2020 bookings into 2021 confirmations as long as exhibitors give up 15% of their investment to help cover costs.
This is where it gets ugly and Baselworld’s intransigence nudges the show closer and closer to a fatal cliff edge because it appears to have completely lost the support of its staunches allies.
Hubert du Plessix, the president of the Committee of Swiss Exhibitors, who also happens to be a 30-year veteran and director of Rolex, says full refunds “would be the best way to encourage exhibitors who can participate in a future edition of Baselworld”.
“Otherwise,” he continues. “We fear that this will be the end, pure and simple, of Baselworld.”
Mr du Plessix is right. And if the owner of Baselworld goes to war over a few million francs with the companies represented on the Committee of Swiss Exhibitors, including Rolex, Patek Philippe and LVMH, it will lose.
The same intransigence that led Swatch Group to walk out in 2018 will push these other giants out of the door as well, and that will be that.
Mr du Plessix even makes this clear in an entirely unguarded reference to the show’s previous mistakes when he says: “This lack of consideration on the part of the leaders of the MCH Group unfortunately recalls an era that we thought was over.”
MCH Group must offer exhibitors full refunds immediately, and hope that this gesture is enough to persuade them to re-book for 2021. If not, I share the fear of Mr du Plessix that this will be the end, pure and simple, of Baselworld.
It may already be too late, but coming to the correct decision today may be the only way to save the show.