2012 Sign Franchise Review Commentary

1. How is the overall franchise segment of the sign & graphics industry faring in 2012 over 2011?

Catherine Monson, CEO, FastSigns: From talking with our friends in the industry, both franchise and independent, as well as our vendors and the industry associations and trade publications, we understand that our industry is off to a better start than 2011; however, the industry is still not at our pre-recession performance numbers.

Ray Palmer, Jr., president and CEO, Signs By Tomorrow: Although we cannot speak on behalf of the entire segment, all indications point to increased same center revenues across all brands within the signs and graphics industry.

Steve White, COO, Allegra Network: Based on the conversations I have had with executives from the other sign and graphics franchises, it would appear that we are all doing well. It sounds like the first quarter of 2012 has been the best sales growth period since before the Great Recession. I believe the franchise segment of the sign and graphics industry was able to withstand the recession better than many because of the strength of our systems and programs.

2. How is your franchise faring in 2012 over 2011?

Monson: 2012 is off to a very strong start. FASTSIGNS has experienced eight consecutive months of double digit same center sales growth. This is partly due to the slightly improving economy, but more so the result of the prior years' efforts to differentiate ourselves from the competition, increase the number of outside salespeople in our outside sales program, and broaden our products and services. That effort is showing results in new customers every day. FASTSIGNS also invests in national marketing, including television, which has a direct impact on web traffic and center sales. The FASTSIGNS Undercover Boss episode aired May 4 and we have experienced an immediate increase in web traffic, calls, new customers and sales growth. Our new brand positioning of "More than fast. More than signs" is resonating with customers and prospects. We are also experiencing a very strong year in franchise sales, domestic and international, both with new centers and with conversions.

Palmer: Signs By Tomorrow is experiencing a strong 1st quarter. This growth is attributed to pent-up demand, warmer weather across the country, and the expansion of our products and services due to advancements in technology and materials.

White: We saw a return to sales growth at Signs Now at the end of 2009 and have experienced steady sales growth since that point. This trend has continued into 2012 with good growth through the first quarter. We fully expect 2012 to be our best year ever.

3. What technological changes and developments have helped to move the industry forward?

Monson: Latex printers, flatbed printers and contour cutting have broadened the service offering and improved efficiency. Workflow efficiencies and electronic communications with customers including online proofing and job status reporting have helped suppliers better engage with customers. In addition, Integrating bar codes such as “QR codes” into traditional static signage that take the user to mobile web sites has increased the value add proposition.

Palmer: The continued improvements to print technology and the introduction of new materials are the keys to our industry expansion and growth. The introduction of latex print technology and the ability to print on fabrics has assisted us in providing our clients with greener yet sophisticated graphics solutions.

White: Over the last decade, CNC routers have put three dimensional sign production within the reach of many smaller operators. Laser engravers have also greatly expanded the boundaries of products and substrates that can be successfully engraved. Large format printers, along with their ink sets and substrates have steadily improved in efficiency, image quality and reliability. It’s now possible to put graphics on virtually any surface you can imagine; from under-ice hockey rink signage to accurately printed company logos on the tops of cupcakes.