Global Events Partners Inc., a marketing consortium of destination management companies, and The Krisam Group Inc., a sister company that represented hotels to the meeting planning community, filed for bankruptcy protection under Chapter 11 on January 31 in California Northern Bankruptcy Court.
According to the voluntary petitions, in both cases, “the debtor claims that funds will be available for distribution to unsecured creditors.”
Chris White, founder of the Washington, D.C.–based companies—which ceased operations late last year—announced in October thatGEP was closing seven of its company-owned and -managed DMCs. But the collapse of the marketing consortium of independently owned DMCs didn’t come until later.
Last November, White, who now lives in Northern California, told MeetingsNet that both companies were up for sale. Also in November, Associated Luxury Hotels International, a competitor in the hotel representation field, hired five of Krisam’s former employees. When White couldn’t find a buyer for the companies, operations “collapsed,” he told MeetingsNet in December. “I spent nearly 40 years building these companies, and I am absolutely devastated,” he said.
The former president of GEP is the president of a newly formed DMC consortium called Global DMC Partners, based in Washington, D.C. Catherine Chaulet, who came to GEP last September from her post as senior vice president at BostonCoach and Best of Boston, told MeetingsNet in a January interview that “there is no connection between GEP and Global DMC Partners. We have nothing in common. Our clients reached out and said they were sorry to see GEP disappear,” she added. “They wanted a network that provided an alternative with the same values.”
Other principals in Global DMC Partners include Jim Hensley, CEO,who ran Allied PRA Destination Management’s European operations out of London until December 2011. Also joining the new company as senior vice president, operations, is Stacy Tischler, formerly COO of GEP and The Krisam Group.
“We didn’t want to lose the relationships we had as a leading consortium of DMCs,” said Chaulet. “We are now 100 percent network—that is, we do not own or manage any DMCs.”
Chaulet said about 80 percent of the independently run DMCs that had belonged to GEP were joining the new company, now representing 73 destinations. Chaulet added that the company plans to host a summit for its DMC partners and clients in June, similar to the annual summit that the former GEP hosted.
The new consortium requires its DMC partners to have the following, according to its Web site, www.globaldmcpartners.com: a minimum of five years in business as a DMC, a minimum of two bank references, a minimum of three client and vendor references, a minimum of $2,000,000 in liability insurance, and membership in two national professional organizations.
The Industry Reacts
After the closing of the GEP owned and managed officers in October, Fran Rickenbach, CAE, IOM, executive vice president of the Association of Destination Marketing Executives International, responded to the story on MeetingsNet with this post: “Destination management companies have just finished a strong 3Q and are looking towards an even better 4Q 2013. ADMEI members exhibiting at IMEX America last week agree that bookings for 2014 are strong, and business already on the books for 2015 will result in increased revenues for DMCs in the next two years, both in North America and globally.”
The post goes on to say “many ADMEI members are stepping in to assist clients of the recently closed GEP owned DMCs.” Liz Keyser, DMCP, CMP, principal, AlliedPRA Northern California and ADMEI president (at that time), posted “while we respect the business decision that led to the closing of the GEP owned DMCs, we are pleased that current and future clients are enjoying the professional support of other ADMEI members to ensure that events and programs are executed without a hitch. There are long-term ADMEI member companies in each area that can provide seamless management support in this transition.”
On January 13, ADMEI announced it would hold a “meeting of representatives from DMC consortia throughout the world and independent DMCs to discuss an industry response to current issues facing DMCs,” which was a result of “recent events,” according to the association. More than 40 global DMC owners met in Washington, D.C., February 6 during ADMEI’s annual meeting.
Jennifer Patino, DMCP, CEO of Hosts Global and current ADMEI president, released this statement after the meeting: “As an international not-for-profit trade association, ADMEI has a long history of defining, protecting, and promoting the destination management industry.In fulfilling its mission, ADMEI is committed to preserving the integrity of the destination management industry for both internal and external stakeholders. As the result of the meeting, even more stringent requirements for accredited destination management companies will be established based on the recommendations of a newly formed task force.”
The association accredits DMCs through itsDestination Management Company Accreditation program, which is designed to “elevate professional standards and designate firms that demonstrate advanced knowledge and experience essential to the practice of destination management.”