Look away now if you get jealous easily. Signarama’s Australian boss has a message that could make commercial printers envious: signage work is plentiful and margins are healthy.
“There are still pretty good margins in signage because everything is custom,” says Evan Foster. “There’s always plenty of work out there. There are lots of sign companies that aren’t just surviving, but succeeding.”
That explains the signage franchise’s aggressive expansion plans. Signarama currently has 91 Australian stores. A new store is scheduled to open in Geelong as early as this month, and if Foster has his way, he will be presiding over 100 businesses by the end of the year.
But he is wary of over-reaching. “There’s definitely a limit. We’re not interested in putting stores in on top of one another,” he says. Foster believes Australia’s population can support 120-130 franchises. Signarama should take about six years to reach that limit, he adds.
Most of that growth is forecast to come from the regions, which he says are less cluttered and less competitive than the big cities. “The general rule of thumb is if a town is big enough for a Bunnings, it’s big enough for us.”
Two prime targets are Canberra and Darwin. Foster says it is disappointing that Signarama is still unrepresented in the two state capitals, even though it has been 15 years since the country’s first franchise opened in Preston, Melbourne. Signarama is also eyeing up Launceston in Tasmania, Mt Gambier in South Australia, Tamworth, Orange and Dubbo in New South Wales, Mildura and Sale in Victoria, Townsville and Rockhampton in Queensland, and Geraldton and Albany in Western Australia.
Foster says Signarama’s big-city professionalism gives regional franchises an edge – whether through the cloud-based MIS system that automates production or the preferred supplier arrangements that offer cheaper equipment and consumables. The result is lower prices, higher quality and faster turnarounds, he adds.
The only downside with expanding outside the metropolitan areas is finding skilled staff. Signarama’s franchises employ 450-500 people and have a combined turnover of $56 million, he says. “Our position is pretty strong. Ever since I joined [in 2006], the recognition of the name ‘Signarama’ has increased a lot. Going to trade shows, a lot more people have heard of us or used our stores.”
Going door to door
Part of that is due to what Foster describes as Signarama’s proactive networking approach. Store owners are encouraged to knock on doors, join local business groups, sponsor community causes and meet as many potential customers as possible. “For the first 10 years we were in the country, the Signarama brand grew by people wearing out their shoe leather.”
Signarama also takes a proactive approach to identifying potential new franchisees. “We’re a franchise company, we want to keep growing, and if we want to get to 100 stores by the end of the year, we need to find qualified people and see if we’re the right fit for them and they’re the right fit for us,” he says. Signarama is also happy to field approaches. It’s difficult to give exact figures, but Foster estimates that about half the enquiries come from attractive candidates, with one in 15 subsequently coming on board.
Since 2010, Signarama has also grown the brand by signing up independent stores. Foster portrays it as a win-win outcome: Signarama gains an established business, while the new franchises get access to group buying, marketing and IT power.
These converts don’t have to be signage companies; Foster says he is willing to grant licences to printers that want to diversify, as he did with Gympie in 2010 and Mackay in 2012. Nor do they have to surrender their identities; a firm can have a print business with one name sitting alongside a Signarama-branded business.
There are almost 1,000 Signaramas operating in 50 countries. It was founded in 1986 by American father and son Roy and Ray Titus. Roy had form – he founded Minuteman Press in 1973 with another son, Bob. Signarama is a part of the United Franchise Group, which also includes outdoor franchise Billboard Connection and embroidery franchise EmbroidMe.
Foster arrived at United Franchise Group with 15 years of sales and marketing experience. He studied commerce at the University of New South Wales, before joining Yakult in 1995 as a sales rep. He moved on to health food company Health Minders, first as assistant brand manager and then franchise services manager. He then became marketing manager at Health Minders’ franchise operation, Healthy Life.
The Sydneysider moved to Perth in 2006 to become United Franchise Group’s local marketing advisor. In 2008, he was promoted to marketing director; in 2010, he returned to Sydney as national director. This was a newly created role after head office in Florida decided it wanted Australia to exercise greater control over its operations.
Australia is in charge of day-to-day operations, but all major strategic decisions are made in consultation with the US, says Foster. Australia’s influence has steadily risen in the past few years thanks to the year-on-year growth it has recorded since the GFC. One area in which the US has taken the lead is initiating an ongoing brand review, which Foster says has been welcomed locally.
Foster sees only one downside to Australia’s aggressive expansion. “As we get bigger, it’s harder to maintain that same sort of family feel that it had in the earlier days, where every franchise knew every franchise,” he says. These days, there’s less of a we’re-all-on-the-same-team ethos, and it’s not unheard of for disputes to break out between stores.
Two things stand out when Foster talks about his franchisees. The first is his admiration for the hard work they’ve put in to grow their businesses. The second is his ability to remember all their names. Every second sentence seems to include a reference to Tim from Tuggerah, Craig from Joondalup or Greg from Footscray.
Foster has met all the owners and many of their staff. “Franchising is all about relationships and I can’t be effective in my role if I don’t have relationship with all those guys,” he explains. An average month would see him travel to two other states and visit 10 stores.
The site tours are partly about pressing the flesh, but they’re also the ideal place to field complaints, discuss strategy and exchange ideas. “That’s where the best ideas come from. I get itchy if I’m sitting around in the office for too long,” he says.
He is keen to hear the market intelligence that franchisees have gleaned from their regular dealings with customers. Foster also appreciates it when they share relevant experience gained from their pre-Signarama careers.
The corporate head office in Gladesville is always happy to discuss problems with storeowners, who can also call on field support personnel and marketing staff. Ultimately, though, they are in control of their own destiny. Signarama charges a royalty fee of 6%, which is lower than the average because HQ leaves much in the franchisee’s hands.
“We’re pretty rare in the franchise industry for being more hands-off than the norm,” he says. For example, even though Signarama has preferred supplier agreements with HP, Roland DG, Ezy Taper and Spandex, stores are able to source their equipment elsewhere.
They can also choose their own prices, although a guide is built into their Signvox online portal. Signvox’s cloud-based MIS has been mandatory for new franchises since 2011, although older franchises have been able to stick with their existing systems. All franchises are obliged to take part in national marketing campaigns, although they can also pick and choose from supplementary marketing options.
Being United Franchise Group’s top man in Australia can be a demanding job, what with all the travel and the regular late-night calls from the US. Foster says he’s lucky to be able to count on the support of a very understanding wife, who is due to give birth to their third child in April. His professional and family commitments mean he now has a lot less time for his other great love – sport. He supports Wests Tigers, West Coast Eagles and Barcelona, and enjoys “watching anything with a ball”.
He probably won’t get to enjoy so much of the upcoming AFL and NRL seasons because his business – and family – are continuing to expand. The economy may be tough, but he is convinced signage firms are in a better position to succeed than many businesses, including commercial printers. Give clients timely quotes, fast turnarounds and quality work and the cash registers will keep ringing. “Signage is still one of the most cost-effective types of advertising there is,” he says.
Resumé
Age 38
Career history 2010-present: national director, United Franchise Group; 2008-10: marketing director, United Franchise Group; 2006-08: marketing advisor, United Franchise Group; 2005-06: marketing manager, Healthy Life; 2004-05: franchise services manager, Health Minders; 2001-04: UK and Ireland working holiday; 1998-2001: assistant brand manager, Health Minders; 1995-98: sales rep, Yakult
Education 1993-95: Bachelor of Commerce, University of New South Wales
Sporting teams Wests Tigers, West Coast Eagles and Barcelona
Family Wife and two children (with a third on the way)
Evan Foster on…
Guiding success
Particularly with new franchisees, to be able to take them from their first day in the business and then to see them succeed is one of the best things you can get out of the job. When you see people be successful using our system, it’s very rewarding.
Meeting with franchisees
The franchisees are where the best ideas come from. A lot of programs we come up with originate with a franchisee saying, ‘I’ve come across this and I think it’s a good idea’. I also enjoy feeling the pride they have in their work, and how they enjoy showing it off to their family and friends.
Competitive advantage
We’ve got a great network of franchisees, so we’ve got a lot of mentoring and knowledge in-house. We also offer buying power, a strong marketing program and terrific brand awareness – we’re top of mind in the signage industry.
Looking ahead
As corny as it sounds, I really just want to keep learning in the job every day. I’ve made my share of mistakes in this role in the first 18 months. The one thing I can say about United Franchise Group is that there are plenty of opportunities in a lot of different areas in different parts of the world. I’m happy where I am and am keen for stability, but my next step might be something globally.
Leadership style
I try to be pretty hands-off. I think one of the mistakes I made in the first 18 months is that I micromanaged too much. I now try to give guys more autonomy to get the job done and try to encourage our guys to come up with the better ideas. I don’t want to be the guy sitting in the ivory tower who thinks he knows everything.
Footy glory
My favourite sporting moment was probably Wests Tigers winning the 2005 grand final. When the Tigers lost the 1988 and 1989 grand finals, I never thought I’d see them win a premiership. I was with my wife-to-be, so I couldn’t cry, but there were a few jumping-out-of-the chair moments.
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