Source: Web Consulting, Inc.

Franchise sign shops continue to drive the growth in the sign industry, according to Web Consulting’s 2004 market report. Growing by almost 4% in 2003, the franchise segment of the sign industry accounted for total sales of $743 million and is projected to continue to outpace the other market segments within the sign industry. Web Consulting projects similar growth in 2004, resulting in total retail sales to increase to $770 million.

During the early to mid-1990s, the franchise market was experiencing double-digit growth rates. Growth has since slowed considerably but still outpaces all other market segments. “This growth did not come at the expense of any one segment but was instead fueled by the cannibalization of all other signage market segments – vinyl, commercial, and electric. This trend by the franchise segment – a very slow cannibalization of other markets - is expected to continue,” stated Lisa Onesto, Senior Consultant of Web Consulting, Inc.

In addition to franchise sign shops, other market segments making up the sign industry include electrical sign shops, commercial sign shops, and independent vinyl sign shops. According to the study, the sign industry in total achieved a modest 0.2% growth in 2002, responding with 0.6% growth in 2003 reaching a sales total of almost $9.3 billion. For 2004, total industry growth is projected to remain modest but slightly stronger than 2003 at 1.5%.

“The sign market continues to meet increased competition from digital printing occurring in other market segments,” stated Ms. Onesto. “This is not an uncommon phenomenon, as we’ve seen it in other industries we’ve researched. More and more market segments such as digital printers, photo labs, and reprographics houses are moving outside their historical applications or customer base and into signage, graphics, and banners. Now, not only is a sign shop competing with other sign shops, but also with other outside, non-traditional segments.” Web Consulting feels this increased competition may be weakening the growth potential for the traditional sign markets.

Regarding the screen print market, Web Consulting believes that weaknesses in US advertising spending are negatively impacting the screen print market. Although US advertising spending by national and local advertisers does not create the only demand for graphics, it does drive demand for several of the applications and graphics produced by screen printers, such as banners, billboards, display/point-of-purchase graphics, and event graphics. Web Consulting is forecasting a moderate growth rate of 1% in 2004 in the screen print market. This is due to the projected increases in US advertising expected in 2004.

The U.S. Sign & Screen Print Market Report is published by Web Consulting, Inc. Web Consulting uses both industry data and primary research as the basis of this report. Conducting over 300 surveys each quarter, Web Consulting also uses US Census Bureau data and Dun & Bradstreet databases to confirm growth rates and market sizes. The report includes an analysis of supply markets such as the market size of PSA vinyl, banner material, application tape and screen print ink. Within the report, prior year-end sales totals are updated and all forecast projections are challenged and revised based upon the most recent industry trends. The U.S. Sign & Screen Print Market Report is available immediately. For more information, please contact Michael Flippin in Web Consulting’s Boston office at Tel: (617) 536 5925.

Web Consulting
Originally founded in 1993, Web Consulting (www.webconsulting.co.uk) is a leading global consultancy to the digital and analog printing and imaging industries. The company provides primary market research, technology information, merger and acquisition support, strategic analysis, and supporting services such as implementation, training and project management. The company specializes in graphics, textiles and industrial applications for digital and analog printing and decoration. In December 2003, Web Consulting, Inc. acquired Vector Marketing’s Digital Printing Research and Consulting Business.

Website URL: www.webconsulting.co.uk