The sign-making market is one heck of a competitive place at the moment. In addition to the established companies in the sign industry, there are a host of companies in other sectors that are diversifying into our market in order to take advantage of the many opportunities available.
In order to continue to succeed in this crowded market place, sign-makers need to add something new to their service offering to help bring in new business. One area many have successfully expanded into is trade supply, which although attractive, has a range of pitfalls ready to trap those who move into it to quickly.
With this in mind, what sort of opportunities are available in the sector at present, and what sort of work and demand can sign-makers expect after setting up a trade supply wing of their own?
Make an impact
Impact Sign Solutions has produced a range of applications for the trade sign sector,
including aluminium engraved signs
One company involved in the sector is Impact Sign Solutions, a firm that has been established for 20 years and specialises in engraving techniques. Andy Borrow, managing director, says the company has enjoyed taking on a range of work since branching out into trade supply.
He explains: “We can offer laser, rotary, and chemical etching, as well as a service to produce brass and stainless steel prestigious plaques, as well as industrial control panels, data plates in a variety of materials including stain-less, brass, aluminium, acrylic, plastics, and many more.”
With this varied workload, and the company’s ability to handle such wide ranging requests, Borrow says Impact Sign Solutions has experienced plenty of success in the market recently. He says that 2013 was a ‘very busy year’ for the company and, after investing in a CNC plasma cutter to bolster its service offering, he predicts 2014 will be even busier.
Although Borrow admits Impact Sign Solutions has enjoyed success in the market, he warns those that are considering branching out into the sector to consider their options. He explains Impact took into account the amount of work available as well as customer demand before taking the plunge.
The market is a large sector but it is becoming increasingly competitive and it is important to remember this before making the move”
He continues: “Our decision to go into trade supply was based on the amount of enquiries we kept getting from customers. As there is such a high set up cost to purchase all the required machinery, most companies opt for buying from an established trade supplier and re-sell the products. The resale margins can be quite high.
“The market is a large sector but it is becoming increasingly competitive and it is important to remember this before making the move. However, for those that are willing to risk the investment, there is plenty of work out there available to them.”
With this competitive market in mind, Borrow goes on to say that it is important for companies in the sector to differentiate themselves. He says one way of doing this is showing customers the quality of service you have in the form on the ISO9001 certification.
He continues: “ISO 9001 is really becoming a must for many bigger companies, buyers need reassurance that they are buying the correctly specified quality product and increasingly insist upon accreditation.”
Weather the storm
GDI Trade Signs claims to have had the busiest start to a year in its history
Elsewhere, GDI Trade Signs has also reported recent success in the trade supply sector. The firm prides itself on manufacturing high-end difficult signs and letters, utilising a range of materials from bronze to copper and steel combined with LED illumination. Chairman Colin Pestell claims the market is currently a mix of talented companies and those that base work on price.
He continues: “There are a lot of letter-makers out there now. When we started, there were only one or two recognised trade letter-makers and only one of those approached the market in a professional way. Now there are extremes, some very good professional companies and others that compete purely on price.”
We suffered badly at the beginning of the recession in 2009. However, having weathered the storm, our business has increased year-on-year, and in 2013 we enjoyed our biggest year ever”
Considering why the company opted to go down the trade supply route in the first place, Pestell explains: “We had a very talented team of sign-makers that, in skill terms, were being under-utilised. We were already doing some trade work anyway, and it occurred to me that marketing our skills direct to the trade was an opportunity to widen our customer base and utilise those skills more fully.”
While GDI may have enjoyed a successful 2013, Pestell explains that business was not always so good, and those entering the market should be aware of the peaks and troughs that accompany it.
He continues: “We suffered badly at the beginning of the recession in 2009. However, having weathered the storm, our business has increased year-on-year, and in 2013 we enjoyed our biggest year ever.
“For 2014, in general, we have never had such a busy start to the year. Keep-ing up with it is going to be hard work—which is not a bad problem to have.”
Genuine optimism
Trade Signs hit the cobbles of Coronation Street recently to install new signage on
the show’s new studio building in Manchester
The Sign Group is another company currently enjoying the variety of work available in the trade supply sector. The firm supplies a range of products in addition to signage, such as light boxes, laser cutting, and wide-format print. Graeme Poole, production manager, believes the market has grown in recent times and the company has felt the benefit of this.
He explains: “We feel that the trade market has significantly improved over the last nine months and genuinely feel that the market is showing optimistic signs of real recovery.
“High street retailers seem to be spending their way out of trouble, or trying, which has given everybody a positive feeling that things are on the right track, and the smaller companies seem to be following suit. We have never been busier, seeing a 200 percent increase in work over the last six months from the previous year.”
Poole continues: “We have very controlled and quick manufacturing in house, and this definitely is more suited to a trade customer than a retail client. The type of work we have the opportunity to do is very varied, but importantly the way we receive the information is much clearer and quicker, meaning we have much less ‘back and forth’ with a customer, and can turn around more work than we would otherwise be able to.
We feel that the trade market has significantly improved over the last nine months and genuinely feel that the market is showing optimistic signs of real recovery”
“Whilst we understand our margins have to be lower to accommodate the trade customer, our large client base allows us to keep a high level of turnover, with less issues and a less risky profit margin.”
Having identified 2013 as a successful year, Poole says it is important for the firm to continue to invest in both machinery and staff to maintain this success.
He explains: “Because we are forward-thinking and always looking to improve not just our service but also our product supply range, we are confident the future is rosy. For the first time, we delved into manufacturing our own branded range of products in 2013 with SG LightSheet and SG Light-Shapes. They have become an important part of our working week and have given us confidence in developing other solutions.
“We have a new product we are very excited about as a replacement to neon letters, which keeps the neon look but using modern technology.”
Poole concludes by explaining that the secret to the firm’s success is by listening to the demands of the customer: “We learn so much from our clients; we listen and provide what they want, when they want it, at a price that benefits us all.”
Booming market
Catering for a range of work, the Sign Group has identified the trade supply sector
as an improving market and expects this to grow throughout the rest of 2014
Aptly named Trade Signs is another company making a name for itself in the trade supply sector. The Hertford-shire-based firm boasts a lengthy customer base with a host of different products on offer. Matthew Driver, director, says the firm is currently enjoying its best-ever start to a year.
He explains: “2014 is the most amazing start I’ve ever had. December and January is quite a tricky time in the sign industry as companies tend to close their doors between mid-December until mid-January—but this has not been the case for us. We found that our turnover in general remained consistent in these months and, on current figures, I think we’ll be about 20 percent ahead of our targets.
“Last year was also a transitional year for us after we moved into a new premises. Once we had settled in at the new site by June, the following six months saw the size of our company double. We hit all targets and were actually 10 percent above our targets for the year.”
Driver explains that this success has been boosted by what he describes as a ‘booming’ trade supply market. While increased business is good for the firm, he explains that ongoing interest and growing demand means Trade Signs needs to retain its consistent levels of production in order to continue succeeding.
He explains: “The problem we have at the moment is that coming out of the economic climate we have been in, people are spending so fast. As it’s grown so quickly in the last twelve months, we are trying to control growth of the company, in order to retain quality and service for customers.”
Trade supply is probably one of the hardest markets to be in. You’re not dealing with the end-user so that can be difficult as some trade supply clients can be very vague with specifications”
With this in mind, Driver issues a warning to other companies already established in the sector, as well as those that are considering branching out into trade supply.
He counsels: “Trade supply is probably one of the hardest markets to be in. You’re not dealing with the end-user so that can be difficult as some trade supply clients can be very vague with specifications. Understanding expectations is the most vital thing in trade supply at the start of the transition.
“You also have to consider the speed of production and meeting deadlines, as well as quality controlling all of your work. Ultimately, price is also vital at some point; we’re not the most expensive and not the cheapest, but what you get with us is consistency and quality, and the deadline met 99 percent of the time.
“It is important to remember that there is no loyalty in trade supply, price is key, manage expectations, meet the deadline, and make sure the quality is there.”
With plenty of work available in the trade supply sector, it seems that a move into the market could be a possibility for some sign-makers. However, with well-established firms already enjoying the benefits of the busy market, those that choose to enter should plan their move carefully in order to ensure they can compete.
