Trade fair

What it means

A trade fair is an industry exhibition where companies present their products and services, make business contacts and keep an eye on competitors. Unlike a general exhibition, it focuses on a specific sector and its visitors are mainly professionals, business partners and the media.

Taking part in a trade fair is part of event marketing, and in B2B sales it can be an important source of new customers. A face-to-face meeting at the stand often speeds up a deal that would otherwise take months of remote communication.

For a company, a trade fair involves several types of cost: floor space rental, stand construction, promotional materials, shipping of exhibits, accommodation and travel allowances for staff. Fairs abroad add questions of VAT and foreign business trips.

How it works in practice

At a fair abroad, the place of supply of each service must be assessed. Admission to an event is generally taxed in the country where it takes place, while other services to businesses are taxed where the recipient is established. Foreign VAT can then, under certain conditions, be recovered through the foreign VAT refund procedure.

Staff at the fair are entitled to travel allowances under the rules for domestic or foreign business trips. Hospitality for guests at the stand counts as entertainment costs, which are generally not tax-deductible, whereas promotional items bearing the company logo can be under certain conditions.

To make participation worthwhile, it is wise to set goals in advance, such as the number of meetings or leads gained, and to collect contacts systematically, for example in a CRM. Following up quickly after the fair is crucial, because contacts' interest fades over time.

What to watch out for

Trade fair costs are easy to underestimate, especially abroad. Besides the obvious items, staff time away from normal work, preparing materials and the organiser's chargeable services, such as electricity, internet or cleaning, must be included.

When exhibits are taken to a fair outside the EU or brought back, customs formalities must be handled, possibly using temporary admission. Forgotten formalities can cause delays at the border and extra costs for duty and VAT.