Printers looking to expand their businesses are well advised to look at franchises, says Evan Foster, national development manager for Signarama, and EmbroiderMe, as are existing sign or display operations.

Foster says, “In the case of existing smaller sign or display businesses there are tremendous advantages in converting to a Signarama franchise. These include having the brand name, the marketing back up, the technological and systems support.

“However one of the biggest benefits is without doubt that it provides an excellent exit strategy. If you are the owner of an independent sign shop it is much harder to sell it than if you are the owner of a Signarama franchise. There are a steady stream of applicants for our existing stores, most of whom come from outside the industry, whereas for an independent sign shop the pool of buyers is far smaller, because you are essentially drawing only from people in the industry, and those people are less likely to want your kit, they will just want the customer list.”

Signarama has just switched over an independent print shop in Gympie for exactly these reasons. Foster says, “That is an interesting shop, at present they are doing 70- per cent in print, 10 per cent in cartridges and 20 per cent in signage, but the owners are angling their business to be 70 per cent in signage.”

The sign and display industry is evolving rapidly, as the lower end products become commoditised, and Signarama is leading that evolution. Foster says, “When we began operations the standard pull up banners and posters were our stock in trade. However the market is becoming more sophisticated, as those products become more commoditised, so now Signarama franchisees are moving into more sophisticated signage solutions, which naturally command higher margins.

[Related: Photos from Signarama expo]

“When any printer can buy a pull-up banner for around $100 from various trade suppliers it is clear there is no business growth in that. We have moved away from a focus on commodity products onto larger projects.

In the case of printers looking to diversify Foster is equally bullish, he says, “We recently had a printer from a regional city that came to us, they had been in business for 20 years, they were a $2m a year business, and realised they had to diversify to grow. The decided that sign and display was the sector they wanted to be in, and after careful analysis came to the conclusion that a Signarama franchise was the correct strategy for them. And since they came on board and opened a store they have been outstanding.”

Foster says the computer software and hardware is another key benefit of joining Signarama

The average length of tenure of a Signarama franchisee is around seven years, which means that in any given year some 10-15 per cent of the stores are bought and sold. Foster says, “That is fairly standard across the whole franchise sector. Signarama has a full franchise sales team to effect successful sales, which is not something that an independent store would have.”

The group that owns Signarama has in fact just launched a business brokerage franchise, Transworld, which is independent of Signarama, but as Foster points out the business knowledge will come in very handy when it comes to assisting Signarama owners exit their businesses.

To start a Signarama from scratch costs $205,000, although the bank will lend 50 per cent of that against the value of the store. Foster says, “We have a very good track record, the banks knows that Signarama stories are a solid business.”

The group that owns Signarama, and Transworld, also owns the successful EmbroidMe promotional apparel franchise chain, which has more than 50 stores now in Australia. Foster says, “The promotional embroidery sector is much like signage was 20 years ago, highly fragmented, which presents a great opportunity for a chain like ours to come in with a professional approach, with proven systems and processes, with marketing and with buying power.

“The market size is not easy to determine, but from the data we have we can say with some certainty that it is between $2.5bn-$3bn in Australia, so you can see there is a huge opportunity there, and our guys are very keen to exploit that.

“EmbroidMe offers small business owners the opportunity to diversify into a growing market, which will continue to grow, and where strong competition is thin on the ground. Like all our franchises it does not initially require an in-depth knowledge of the technologies or the market, but it does require a sales and marketing focus, and an absolute commitment to customer service.”

EmbroidMe is the world's largest uniform, embroidery, screen printing and promotional products company. Its products include corporate uniforms, work wear, sportswear, embroidered apparel and personalised promotional products. The latest EmbroidMe in Australia, number 53, has just opened for business in Maroochydore on the Sunshine Coast.

The group is also about to launch a whole new franchise chain, ExperiMac, which is essentially a business which will service and repair Apple Macs, sell accessories, and importantly trade pre-owned Macs. Foster says, “The first stories have opened in the US and are going gangbusters. Mac users are fiercely loyal, but not all of them are happy with the price points the main stores operate on. In fact our research shows that only one in 50 people who visit a Mac store actually buy one, most are there to have a look and a dream. ExperiMac will take pre-owned Macs, say those that corporations or governments have had and that have come to the end of their lease, they will service and refurbish them, then offer them for a sale at a far more accessible price point. Similarly the repair and service will be more keenly priced. It will be like the difference between taking your car to the main dealer or the guy around the corner, the work on the car is the same, but ExperiMac is able to offer better pricing.”

For anyone looking to diversify into a completely new field, with an ExperiMac store Foster indicates the fee will be more or less the same as having a Signarama, at around $215,000.

One of the benefits for printers signing on to the franchise model that is Signarama is in its marketing and brand promotion. Franchisees pay for it of course, around two per cent of turnover, however in return they get a marketing programme that they could never come up with or fund on their own. For instance Signarama has just run campaign on AM and FM radio, targeting business owners.

With 103 Signarama stores each contributing to the marketing budget there is immense power for individual store owners, far more than they could leverage individually. Foster says, “The radio campaign was a great success, the brand awareness among business owners puts Signarama now front of mind. And they also know that Signarama is not just a sign company, but is actually focused on understanding their businesses and helping them achieve their objectives. And of course a campaign like that is a door opener, we are not an obscure outfit from the back on an industrial estate, we are a corporate with a corporate understanding.”

Signarama is always looking for more franchisees, and not necessarily in the big metro areas, in fact the focus right now is on regional towns and cities. Foster says, “The size of the town is not a limiting factor. For instance we have a store in Whyella SA, which has a population of 15,000, not big by any standards, and yet that store is a great performer. In fact it was a conversion, an independent sign and display business became a Signarama franchisee, and is now going great guns. That store has a service attitude, uses our systems and technology very well, makes the most of marketing, and focuses on understanding the customer and providing a total solution.”

As a whole business Signarama is sizeable, turnover has now reached $65m and climbing, which is a long way from opening its first store in Australia back in 1998. Foster says in 2016 the company is working towards a ten per cent increase in sales by the franchisees, as they focus in on the higher margin work.

Foster himself came to the business ten years ago with the intention of becoming a franchisee, but first he decided to work for head office to get a thorough understanding of how the business worked, before taking his own store, however he stayed with head office, eventually rising to run the business here in Australia. He says, ”I love what I do. Helping different people achieve their dreams, helping them run a successful business, developing the Signarama business, it is a great role to be in. And being part of a global organisation is exciting. I have just come back from a conference in the US where we had input from all over the world. We learn from each other, and that kind of input is one of the reasons why Signarama is doing so well here, independent stores are just not receiving that level of input. We are learning what is working and what isn’t, marketing strategies, customer demand, growth sectors, technology, IT, and all that is passed onto our franchisees.”

With the figures trending up across the board, and significant opportunity in front of it, Signarama Australia looks set to continue its impressive growth trajectory.

Signarama Cairns triples building size

Signarama Cairns has moved to a new site triple the size of its previous building and invested in a new HP Latex printer in a bid to expand the business.

Owner Garry Allen says the franchise print shop wanted to move into a purpose-built site, which will allow it to provide more services to clients.

He says the new building in Bungalow is 390sqm compared to the old 130sqm one, and is on a main road five minutes’ drive from the town centre, which will give it more exposure.

Allen says the expansion could allow the four-staff company to hire another 4-8 people.

“We made the decision to invest in our business, which has also led us to buying the new HP Latex 360 – largely due to our desire to improve production times, and for its eco-solvent technology,” he says.

“We want to lift the quality of the products in the market, so we have aligned our business with 3M, and the new HP Latex 360 uses the only ink currently suited for the 3M cast media.

“At present we are aiming to be the local market leader in vehicle wraps, LED screen suppliers, promotional products, in-house manufacturing, and supplier of digital print media signage.”

Allen says the franchise, which won the gold medal at the Sign Association Awards in 2012, could easily have bought a flatbed printer, but ‘we needed to know if that was the right move for our region’.

“So we conducted a lot of research and then made the plans to expand. We kept the Roland eco-solvent printer but as time goes on we see another HP Latex series printer being brought, so the company will eventually run two HP machines,” he says.

The Latex 360 produces completely dry products allowing same-day delivery.

Allen says: “Our in-house training and development along with the back-up of other Signarama Franchises enables us to bring to the market the best possible quality for our clients.”

He says a pad printer and other selected machinery are used to continue to expand the business and keep it at the ‘top of the game’.

Allen says Signarama Finance, a new product exclusively for Signarama clients, will give the company 100 per cent tax deductible finance for their signage.

The new building is located at 126 Aumuller Street in Bungalow, Queensland.

New printer doubles franchise production

Signarama Chatswood says the wider range of products offered by its recently installed wide format printer-cutter has more than doubled production.

Owners Marlin and Flora Wang add the new Roland Pro4 XR-640 to their Rastek H652 UV hybrid roll-to-roll and flatbed printer and will be able to hire more staff only a year after buying the franchise sign shop.

The pair had no print experience when they bought the franchise last November, coming from and IT and mathematics background, making training an important consideration when looking for a new machine.

Flora Wang says: “We wanted to do something other than sit in front of a computer. We chose the signage industry because signage is different, and we like that it makes life more colourful.

Marlin Wang says the store’s sales have grown at a steady rate, in part thanks to its increased production capacity and broader range of applications possible after installing the Roland printer cutter.

“We can now have both printers running so we not only get more roll-to-roll work, but we also get more corflute and rigid work as the XR-640 has freed up the flatbed,” he says.

“It runs around five hours every day but till now we have only one production person so that is our main limitation.”

 “We did the Roland training course which gave us basic production skills, so I run the machine when possible, but I also have many other jobs to keep the business running,” Marlin says.

“Thankfully, the new printer is easy to operate. I really do not need to worry about anything like media feed errors, colour banding or head strikes.

“With our flatbed, I need to watch it while it is printing, but the Roland makes life so much easier, which means I can get on with other jobs while it prints.”

Marlin Wang says this year will see a new phase of growth for the franchise store, after the initial 12 months the owners will now look to take on more work and the keep momentum going.

“This year, our first year, has gone well. We have hired two new staff members with comprehensive skills and bought a new Roland laminator as well as the printer cutter,” he says.

“With our new staff and machines we now have more capacity. We can offer printing with white ink, we fabricate letters inhouse and we offer LED light boxes – we do just about everything. In the next couple of years we would like to bring in more jobs and grow the business.”

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