Digital Billboards in Franchising

Another Advertising Agency Turns to EuroDisplay

It happened again, as more and more often. This brings to 18 the number of ad agencies that have turned to EuroDisplay after experimenting for a few months a digital billboard in franchise / concession.

So last month, another ad agency - after having an unpleasant experience with a digital billboard in franchise / concession - has decided to cancel the concession contract (and pay the penalty fee) to go with EuroDisplay.

"There are several reasons that persuaded us to finally go with EuroDisplay." confirms Angelo, the owner of an advertising agency. "It is not only the reliability of the product, but also the seriousness of the company and people."

"After Months of Suffering We Terminated the Contract"

"We did not have a good experience with our old digital billboard in franchising. It caused several service interruptions and many related complaints from our advertisers."

"After suffering for several months, we decided to pay the cancellation fee and to terminate the contract. And to return free to choose our preferred supplier."

"In recent months we have gained a lot of experience in digtal billboards. We have carefully considered all the options available and EuroDisplay seemed like the best in terms of quality, price and reliability."

"We Are Very Happy"

"The new EuroDisplay digital billboard was installed last month. It is a 6x3 meter easyScreen with 10/20mm pixel pitch. We assembled it in just a few hours and it worked at the first try, without any problems."

"At the moment we are very happy with how the deal was completed. The fact that the installation took place without problems, it has confirmed to us that we have made the right choice."

"We intend to grow our network of digital billboards, but to do that we needed a quality product and a reliable supplier. Before we did not feel confident that these conditions were satisfied."

"Only time will tell if we'll win our bet, but at least now we know we have a solid foundation on which to base our project."

Contacts and More Information

For more information, call us now at the No. +39/011-954-1015, or write to info@EuroDisplay.com. Click Here for the Quotation Online or visit the Clients page to see our latest installations and references.

LED Screen Manufacturer or Hoax?

Following last week's article, entitled "Are You a LED video walls Manufacturer or a Hoax?" I received several interesting comments. Each one provided a slightly different angle, but basically all posed the same question: "How do I distinguish a real LED screen manufacturer from a hoax?"

How Not to Get Cheated

First of all, let's try to understand what it means to be a "LED screens manufacturer".

In addition to having the ability to select and mount LEDs, being a LED screens manufacturer means first of all have the competencies to develop a proprietary electronic control that can manage these LEDs to produce a realistic image.

The electronic control system consists of of the following:

1. A Printed Circuit Board (PCB), on which depends the effectiveness with which the LEDs are run, and therefore ultimately the quality of the LED screen
2. A Control and Management Software, with which the electronic board is controlled to determine and change the settings for brightness, contrast, gamma, diagnostics, remote control etc...

Developing these two components requires very advanced electronic competencies, that in Italy only 3 or 4 companies have developed. EuroDisplay was the first to develop this technology in 1978 (for mono-color display) then evolved into true full color screens.

How to Recognise a Hoax

To distinguish one real manufacturer producer from an import company, the best method is to visit their production site. Pretty easy, right?

If this is a real manufactuer, in fact, you will invariably find all the following tools. Since each of these devices requires a large investment, they are very hard to find in an import company, who would not know what to do with them:

1) Production Area

Trading companies are often quite small, consisting only in a sales office. In case there is a larger space, it is usually a warehouse for the goods in transit – at EuroDisplay for example, the manufacturing plant has a surface of over 4.500 square meters.

2) Office of Electronic Design

Any digital billboards manufacturer, has first of all a team of electronic engineers, using one or more professional design softwares – at EuroDisplay for example we use the world's best software Protel®, which license costs about 6.000 euros (www.protel.com).

3) Office of Mechanical Design

LED screens manufacturers also have a team of mechanical engineers, using a professional 3D CAD design software – at EuroDisplay we use the leading 3D software SolidWorks®, which license costs about 7.000 euros (www.solidworks.com).

4) Electronic Microscope

Used to verify the quality of industrial production in printed circuit boards and soldering of electronic components, particularly the most critical – at EuroDisplay we use the state-of-the-art Vision Mantis® Electronic, priced at around 1.000 euros (www.visioneng.com).

5) Climatic Chamber

A LED screen manufacturer must necessarily tests printed circuit boards and semi-assembled at precise temperature and humidity values, to ensure they can withstand the weather when installed outdoor – at EuroDisplay we use an Angelantoni® (leader in climatic chambers) worth about 15.000 euros (www.angelantoni.it).

6) Chroma Meter

The Chroma Meter is a camera that allows measurement of the perfect calibration of the LEDs to ensure that the colors are more vivid and realistic – at EuroDisplay for example we use a CS-100A Konica-Minolta® from the Japanese manufacturer Konica-Minolta, worth approximately 8.000 euros (www.konicaminolta.com).

7) Oscilloscope

The oscilloscope is an electronic test instrument that allows signal voltages to be viewed, usually as a two-dimensional graph of one or more electrical potential differences – at EuroDisplay we use a Tektronix® TDS 5034 from the world's leader manufacturer Tektronix (USA), worth about 9.000 euros (www.tek.com).

Other Ways to Recognize a Hoax

There are other ways to recognize a hoax... do you know any? Use the form below to let us know!

Contacts and More Information

For more information, call us now at the No. +39/011-954-1015, or write to info@EuroDisplay.com. Click Here for the Quotation Online or visit the Clients page to see our latest installations and references.

How do you make sure that your LED Screen supplier is as reliable as they say they are? This is a very important question, which anyone considering to purchase a LED Screen should ask themselves. Here are two true stories from LED billboards owners which you can learn from:

The Story of Mr Nikos from Cyprus

A few months ago we received a request from Mr Nikos from Cyprus. One of our best sales representatives (who is in charge of that region), started to follow-up the request, providing advice and support as per our standard.

Despite all our efforts, at first Mr Nikos seemed not to trust us and we couldn't understand why. When his order arrived it was a great moral satisfaction despite the fact we still didn't know why he was so sceptical at first.

We only discovered the reason behind his doubts when he sent us the feedback-form which all our Customers fill-in one month after the product has been shipped. From his answers we finally understood the reasons for his scepticism…

Send the Money Now Because Tomorrow We Are Broke

We learned that, at the time of our first contacts, he had a hard time trusting any LED video walls supplier on the market because 5 months earlier he had ordered a LED screen from a company only to discover - after he made the down payment - that the company had closed due to the economic crisis (you can read his entire review in the "Clients" page).

When you lose thousands of Euros (10.000, 30.000 or even 50.000) with a down payment to a company that 2 weeks later files for bankruptcy, I'm sure anyone would have a trust-issue.

Is It that Much Better if they Close after 6 Months?

But what happens if the supplier manages to deliver the screen to you, but then closes after 1 month, 6 months or even 1 year? Will this make you feel much better?

Chances are that you will not be so mad because at least you got the LED screen, but you probably won't be thrilled either. Who will provide you with technical support from that point on? Where will you find the spare parts for the LED screen? What if there is a problem that your technician can not resolve on his own?

Buying Expensive Products Is Like Choosing a Spouse

When you purchase high value equipment, such as an LED screen, you are not just buying a product. You are also choosing a partner company. It's almost like a marriage, so you'd better make sure that your partner will be there for you when you need him.

Would it have been possible for Mr Nikos to predict that his supplier would go bankrupt? How could he have avoided wasting his money? Is there a way for you or anyone to avoid the same, disastrous pitfall?

Luckily governments of most Countries put several tools at the disposal of potential Customers that want to check the reliability and solidity of potential suppliers before they make their investment, in order to avoid unpleasant surprises…

The Story of Mr Antonio

A few days ago I met a couple of potential Customers that came to visit our facilities. I was introducing them the Company, but after I said only a few words, one of them, Mr Antonio, stopped me and said:

"Fabio, please don't waste your time and mine as well. I studied EuroDisplay's annual report and those of your competitors well before planning this visit. There is nothing about the Company that you can tell me that I don't already know".

"The reason why we are here is because you have the best annual report among Italian suppliers and your productivity-per-employee is approximately double than other Italian suppliers. So don't waste time to describe me the Company and let's talk about the deal instead."

I was quite shocked by the sincerity of his words and accurateness of his analysis… so I didn't ever mention a single word about the Company anymore that day.

How to Make Sure Your LED Screen Supplier Is Healthy

Now, my guess is that if Mr Nikos from Cyprus would have had the chance to look at the annual report of his supplier before he made the down payment, he probably would have noticed that the company was not healthy to survive the economic crisis. He would have made a more informed choice and maybe he would have considered another supplier - saving thousands of euros.

How to Get the Annual Reports of Your Suppliers

Let's say that you now want to check the reports of several potential suppliers. Would you know how to do it? Who do you call? Where do you get them?

It's a Public Document, Not Covered by Privacy

The easiest way is simply to ask your potential supplier to provide you with his annual report. It doesn't get simpler than that!

In fact, the information found on an annual report is of public domain by law, at least in Italy. So if you hear excuses such as "Oh, ehm… I can not send it because it is protected by privacy regulations", than start to wonder why they don't want to send it to you.

The law does not force companies to make their reports available to Customers (unless they are traded in the stock-exchange), but if they had a good annual report, they certainly wouldn't have any problem forwarding it to you. Actually why wouldn't they show it to anyone who asks for it if they had nothing to hide?

In case your potential supplier is not so collaborative - and in case you still want to work with them - the official way to get the document is by contacting a Chamber of Commerce in the Country of the supplier.

How to Get Any Annual Report from the Chamber of Commerce

For example, if you are evaluating an Italian supplier, you can contact any branch of the Chamber of Commerce or simply follow these 3 simple steps (valid for Italian suppliers only):

• Download this form, print it and fill-it with the information required
• Make a bank transfer of EUR 4,50 to:
  
  Intesa Sanpaolo Spa
  IBAN: IT68 I030 6909 4006 1524 6092 056 / SWIFT: BCITIT33100
  Beneficiary: Camera di Commercio Industria Artigianato e Agricoltura di Milano
  Causal: Certificates
• Send the form and a copy of the payment via fax at the number: +39 / 02-8515-4733

Information Empowers You

If you don't want to waste your money, next time you consider purchasing a digital billboard, make sure you invest in the right supplier. Don't listen to a salesman that tells you how good they are and how bad the competition. Take the time to look at the numbers.

Use the procedure above to request all the annual reports of your potential suppliers and compare them, side by side. And if you have any doubts on how to read the data, ask your accountant to help you out - I promise it will be well worth it.

With EuroDisplay It's Even Easier

As a further tangible proof of its ultra-decennal commitment to Total Quality and transparency, EuroDisplay makes its annual report publicly available for free to anyone who will request it. Just fill in this form and send it to us via fax at the number +39 / 011-954-1017. So you have one less report to ask for.

Digital Billboards Franchising

Digital billboards franchising became somewhat popular in Europe in the early 2000’s where it is offered as a form of “long term rental”, that allows to test the business model for a few months and with a fairly limited amount of initial capital.

Let’s just take a quick step back: what franchising is exactly and what are the main advantages?

Franchising is a business model that allows you (the franchisee) to open your own company by using the know-how of another company (the franchisor). There are several advantages in the well-known formula of franchising, when it is well organized by the franchisor:

Advantages of Franchising

• Tested Business Model: opening your own franchise it means to open your own private business on a model that has been already tested (hopefully successfully) by many other entrepreneurs and that therefore should bring no bad surprises.
• Lower Start-Up Costs: franchising allows you to reduce the start-up costs any activity has, for example by being able to exploit the reputation of the mark without having to invest in advertising. With the support of a parent company, you can also avoid all the costly mistakes made by those who open a new business and that are often the cause of the failure within months from opening.
• Turnkey Solutions: since you're opening a business already tested and where the details have already been studied, the new activity will be delivered to you in a "turn-key solution", that is (for example) with the furniture already defined, forms and contracts already drawn etc.
• Continuous Training: big franchising companies will provide adequate training on both the management practices of the business and sales techniques - while the promotion and marketing are usually handled by the parent company. In successful franchising programs, the training starts even before you open the real business and it continues at regular intervals (e.g. once or twice a year) for the entire duration of your business.

Well it seems the perfect activity. Why then there are not just franchising everywhere? Not only in the digital billboards industry, but in any other sector? Because, unfortunately, the practical implementation of the franchise can hide many serious drawbacks:

Disadvantages of Franchising

• Lack of Support: most of the big franchise companies (like McDonalds® for example), offer extensive training on procedures, a lot of support during the start-up phase and unlimited access to the resources provided by the mother company.
  
  But smaller companies may not be as prepared and professional in this sense, being more interested in selling franchises rather than in the success of the affiliate (i.e. the franchisee / contractor).
• Low Standardization Industry: franchising is applied most successfully in areas that have a high level of standardization, for which can be identified a "formula" for success. Taking the example of the chain McDonalds®, the popularity of this franchise depends on the repetitiveness of the food preparation and standardization of cooking procedures.
  
  In areas with low standardization however, this formula simply can not exist and therefore there can be no guarantee of success (no matter what the franchisor tells you). The low standardization industries are those where the human component is more important, such as those where required customized services are requested by the end user and where, therefore, the preparation of a seller and the availability of the company make all the difference.
  
  Like in the advertising industry, for example.
• Fake Potential: with franchising electronic billboards you are often sold the idea that by entering into the franchise, you become part of a national network of LED screens, where you can share your available advertising space with other entrepreneurs in network and therefore earn on sales made by others.
  
  Unfortunately, the advertising LED screens are a very local business, that targets advertisers within a radius of 10-15 km (maximum) from the installation site of the screen (whether it is in franchise or not).
  
  In fact, Customers who pay to their advertising on a LED screen are typically restaurants, real estate companies, car dealerships, hardware stores etc. So it is very unlikely if not impossible, that a typical advertiser will wants to broadcast his advertising on a LED screen located 200 km away.
• Not a Real Business: inexpensive franchise are often a real hazard. According to Mr Abel E. Malcolm from the American Business Law Journal “most abuses occur in the smaller franchise operations, which sell at less than USD 100.000” (about 70.000 EUR at the moment of publication). You can read the entire article from Dott. Malcom here: http://www.allbusiness.com/legal/618192-1.html
  
  The fact that a business offers a franchise, that doesn’t mean that you will be successful. In some cases, the franchising is the only real business: the franchisor is only interested in selling to more and more Customers and the fact the single franchise is successful or not, it is totally irrelevant to them.
  
  In case you are shown an annual report, keep in mind that it is not the financial success of the franchisor which is important to you, but rather the profits of the other franchisees in the system.
• Unrealistic Promises of Profits without Effort: it is a common practice among franchisors to make a verbal estimate of the profits during the negotiations with the perspective Customer. In some cases, however, these perspectives are totally unrealistic because they promise profits with only six or seven advertisers.
  
  Now, anyone with a modicum of experience in the field of LED billboards will tell you that to be successful in this industry you need at least 15/20 paying customers in order to repay the cost of the screen and get a good return on investment.
  
  By the way, promises of profits without effort are always unrealistic.
• No Government Protection: in most countries there are not effective regulations for franchising. In most cases these regulations do not require disclosing the risk factors of the investment before the franchise is sold to the public.
  
  Unfortunately, many franchisees have unrealistic expectations that the law will protect them from fraudulent franchisors, which is not often the case. In fact in most cases, once signed the contract you are not legally protected in any way.

Franchising as Business Model

To summarize, the great majority of franchisors are serious businesses that really want to develop a successful model, but as in any other industry there are people who are just looking for an easy way to make money.

So they create a “franchise” that looks great but has no substance and absolutely no support or training. They usually target inexperienced people that are so willing to believe in the easy profits that they fail to make a proper appraisal of the business being offered.

How to Purchase a Digital Billboards in Franchising

If you really want to purchase a digital billboard in franchise, I suggest you to contact one of the franchisee already in the network and investigate if he would be interested in selling his business. It is better to buy a “used” franchise, because you can see the annual reports of the business to understand if there are any real profits.

Once established the first contacts, mention your interest in acquiring the asset and carefully assess the reaction of the affiliate: if he is really making profits with his business, he should not be interested in selling his company, unless you make him a very high offer.

On the other side, if the franchisee appears to be immediately interested in your proposal and willing to sell his company (maybe at even less of what you could purchase it from the mother company) then this could be a sign that his business is not going very well and that he can not wait to get rid of everything.

Digital Billboard Franchising: Tell Us Your Story

I'd say it's all for today, but if you've tried the LED video wall franchising formula, tell us your experience (good or bad) and share with our readers by filling in the comment section below. We look forward to hearing your stories.

Dedicated Proprietary Control System. Wow, it actually sounds very professional. But this fancy denomination hides some serious drawbacks that nobody ever tells you, until it's too late.

• The first problem is about transparency: even if the LED billboard has 2 years warranty (or more), the Control System has a 12 months warranty, as written in the sales contract (please, always read it carefully!).
• The second problem is about costs: what happen if control system brakes down after 13-14 months from the date of shipment? You are forced to buy a new one from the supplier… and you do not have any control on the price, which will be very high, as you can already imagine – usually around 7.000,00 EUR.
• The third problem is about freedom: by using such control system you are inevitably tied to the supplier for the entire lifetime of the screen. In fact, you do not have any other option: either you pay again or the screen will not work.

To avoid all this issues, EuroDisplay adopt an Open Plug-and-Play System based on the Apple Mac Mini. Basically EuroDisplay’s LED video walls are like huge DVI monitors that visualize anything you can show on the PC.

The Open Plug-and-Play System allows you to replace the Apple Mac Mini at any time with any other computer with a DVI output, like those you can easily find in stores.

I have heard countless stories of entrepreneurs like you that purchased from companies providing a "Dedicated Control System" and then were held hostages of their suppliers!

They were forced to pay huge amount of money to avoid having their screens shut-down for weeks... it goes without saying that their investment was not so successful in the end. Now you know, so please don't make the same mistake.