Investigating International Business Events Delegate Spending Patterns in Malaysia 1
Introduction To investigate international business events delegate spending patterns in Malaysia To determine the economic value for business events in Malaysia. 2
Business Tourism Supply Chain Business Events Hospitality Supply Chain Engaged Tourism (Leisure) Hotels Restaurants Attractions Retail Tours Transportation Food Services Other Entities Engaged for Business Events Destination Management Companies Exhibition Management Companies Event Management Companies Professional Congress Organizers Ground transportation Tours Team building Social programs Stand building Drayage Storage Furniture rental Equipment rental Cleaning Event Marketing Exhibition halls Entertainment Decoration Costumes Props Graphic designers Lighting Sound Production Rigging Special effects Registration Services Audiovisual Services Catering Florists IT Interpreters Shipping Speakers Security Electrical Telecom / internet Sponsor development Credentials Printing Signage Photography Videography Teleconferencing Convention centres Venues Job Opportunities 3
Economic Impact Assessment Employment Opportunities Business Events Industry Sales Profits Jobs Tax revenues Income Lodging Restaurants Transportation Entertainment Retail trade 4
Economic System of Tourism (1) (4) (5) Purchases Tourist Leisure & Business Tax & Fees, Government Services Travel & Tourism Services (2) Purchases & Investment Employment Personal Income Service Provider Employment (A) (5) Tax & Fees Purchases Government Services Travel & Tourism Suppliers Employment Personal Income Government (3) Purchases & Investment & Taxes & Fees Employees (C) Employees (B) 5
Model of the Economic Impacts of Tourism Tourist s Spending Direct, Indirect, Induced and Multiplier Effect Income from Tourism Received by Enterprises (Direct Impact) Purchases Income from Tourism Received by Suppliers (Indirect Impact) Purchases Employment & Wages Employment & Wages Income from Tourism Received by Suppliers and Their Support (Purchases, Employment & Wages) (Induced Impact) Induced Income from Tourism Tax Revenues Received by Local Authority (e.g. Municipality) 6
Methodology Approach Survey Sampling Data Analysis Quantitative Self-Administered Travel/Planning information Expenditure Pattern 2015 international and regional conference / exhibition SPSS 17.0.1 Money Generation Model On-site Experience Foreign participants Conference delegates and Exhibition Buyers / Visitors Non-probability convenience sampling Most events in Kuala Lumpur, Selangor, Sarawak, Sabah, Penang 7
Findings 8
Conference Delegates 1,917 samples 5 days 25 events 25% US$2,550 9
Conference Delegates 2% 4% 1% 1% 1% 6% 31% 8% 23% 23% 10
Exhibition Buyers 183 samples 6 days 7 events 18% US$2,374 11
Exhibition Buyers 1% 1% 4% 2% 5% 7% 32% 11% 11% 26% 12
Money Generation Model (MGM) Visits from foreign delegate Spending per visit Economic Impact Regional Economic Multiplier 13
Direct, Indirect & Induced Economic Impact Computation Direct Economic Impact = SPSS Average 1 Total Number of Foreign Population: Delegates/Buyers 2 Indirect Economic Impact = Matrix Algebra of Direct Economic Impact and Multipliers 3 Induced Economic Impact = Direct & Indirect Economic Impact Induced Ratio 4 (Value Added/Total Output) + (Income/Total Output) 14
Full Time Equivalent (FTE) Computation Employee 5 Compensation Ratio of Employee Compensation per Output Total Output 6 = Number of Employees 7 Ratio of Employee Compensation per Output = Total Number of FTE 15
Economic Multiplier Study Segments & Surveys Conferences: Delegates Survey Exhibitions: Buyers Survey Micro Areas of Expenditure (Spending Patterns) Conference Registration Fee(s) Cost of International Airfare (if Malaysian Airlines or Air Asia is used) Cost of Domestic Airfare Cost of Hotel/Accommodation and Other Logging Services Cost of Local/Cultural Tours (including entrance fees for attractions) Spending on Local Transportation (rails, public busses & taxis etc.) Spending on Food and Beverage Spending on Shopping (purchase of personal goods, gifts, souvenirs etc.) Spending on Leisure Activities (pubs, cinemas, adventure sports) Other Spending (such as private car hires, personal guide etc.) Exhibition Registration Fee(s) (including workshops) Cost of International Airfare (if Malaysian Airlines or Air Asia is used) Cost of Domestic Airfare Cost of Hotel/Accommodation and Other Logging Services Cost of Local/Cultural Tours (including entrance fees for attractions) Spending on Local Transportation (trains, public busses & taxis etc.) Spending on Food and Beverage Spending on Shopping Spending on Leisure Activities (e.g. pubs, cinemas, adventure sports) Other Spending (such as private car hires, personal guide etc.) Economic Multipliers 2.2 2.1 2.1 1.7 1.6 2.1 2.4 2.6 1.6 2.4 2.5 1.8 1.8 1.7 1.5 1.9 2.3 2.5 1.5 2.4 Average Segment Multipliers 2.0 2.1 Overall 2.1 16
Findings US$246 million direct Economic Value US$ 498 million total economic impact (direct, indirect & induced). US$ 21 million tax revenue (direct, indirect & induced US$ 2000 One FTE (full time equivalent) 238,641 Job Creation 17
Future Research Government advocacy Industry support Based on events supported by MyCEB only Incentive travel and organisers expenditure not included in the calculation 18
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