Executive Summary

The UK corporate hospitality market is concerned with any event for the benefit of an organisation entertaining clients or staff at the organisation's expense. Key Note estimates that the market grew by 9.7% in 1997 to reach £620m.

Around 80% of corporate hospitality is for employees. Employee-based corporate hospitality activities such as go-karting, clay pigeon shooting and family days, account for more than 50% of the corporate hospitality market for clients and employees. Many of these events are organised directly by organisations without using the growing number of corporate hospitality organisers. The other main product sectors of the corporate hospitality industry are spectator sports, arts/culture and other events.

The barriers to entry in the corporate hospitality industry are low, and it attracts new entrants during growth phases. Although the industry was slow to come out of the recession, 1996 marks a year of revival for the corporate hospitality industry, as companies once more invested in building relationships with clients and staff through corporate hospitality events.

Unlike employee corporate hospitality, client corporate hospitality is dominated by spectator sports. Key Note estimates that, in 1997, around 80% of the £135m that organisations spent on client hospitality was on spectator sports. Although international rugby matches are the most popular sports matches for corporate hospitality, expenditure at football matches is by far the largest sports subsector.

Although the total industry is highly fragmented, the spectator sports sector for client hospitality is showing signs of concentration. Many of the large spectator events and tournaments are sponsored and incorporate official corporate hospitality agents, such as Sportsworld PLC and Keith Prowse Corporate Hospitality. Increasingly, the large corporate hospitality companies are engaging in overseas events, as sponsorship of major sporting events becomes more globalised. Nevertheless, the total turnover of Sportsworld PLC is less than 5% of the total UK hospitality market.

Key Note estimates that the UK market will grow by around a third between 1997 and the year 2001, to reach a value of £810m. Similar growth in expenditure is expected for spectator sports.

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