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Archive for Sunday, July 7, 1991

STAR SIGNS PLOTS STRATEGIES FOR SURVIVING CURRENT SLUMP

July 7, 1991

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Mike Vickers wants his company, Star Signs and Graphics Inc., to swim against the tide.

When commercial expansion began tapering off in Lawrence a few years ago, Vickers, Star Signs' president, had an unsettling realization. Ancillary firms such as his shared in Lawrence's boom during the mid-1980s and now, it seemed, were following the local market into a slump.

The developing picture wasn't pretty: After seeing its annual sales double during the city's growth years from $200,000 to $400,000 to $800,000 Star Signs was caught in a holding pattern at $1.5 million and with no more local market left to tap.

"We've grown a lot in 12 years but most of our growth happened in the mid-1980s," he said. "In the past three years, though, it's kind of leveling off."

This year, when the recession officially set in, Vickers said Star Signs' sales have been off 20 percent.

"It's been a struggle this year, just like everybody. I think we're lucky to be as busy as we are," he said.

BUT VICKERS isn't content to wait out the lull in the area market. Despite the current economic conditions, Star Signs moved Dec. 1 into a new 10,500-square-foot building at 801 E. 23rd. And Vickers says his goal now is to increase his sales to $2.5 million within the next two to three years.

What Vickers says will help him defy the current sales trend is increased diversification, both in markets and product lines.

For starters, Star Signs recognized some time ago that Lawrence booming or not had a finite market. Since 1983, the company has operated a sales office in the Kansas City area, from which it now draws half of its sales.

Now, Vickers said, the company is looking to add regional and national accounts to those it already serves. Among its biggest existing clients are the Gilbert Robinson restaurant chain, which owns Houlihan's on the Country Club Plaza in Kansas City, Mo., AMC Theaters and The Brass Buckle, a retail clothing chain that has a store at 805 Mass.

Vickers says those accounts are typical of the kind of work he wants to do for other large national clients. Although the company has developed standard sign packages for each of them, some custom sign work is likely to be required for each individual location.

THE BRASS Buckle, for example, hired Vickers' company to do signs for all 100 of its locations at a rate of two or three each month.

However, Vickers is finding that the national markets are no less immune to the economy than his local customer base. Gilbert Robinson, which had been generating $30,000 to $50,000 in sales per month, hasn't placed an order yet this year.

But Vickers thinks he's also found a product line that will fill in the gaps in the national sign market.

Star Signs has begun marketing a new line of neon signs depicting collegiate mascots and fraternity and sorority emblems. The company has a licensing contract with IC Licensing Agencies, which controls rights to the logos or mascots of 110 schools.

"So far, we're the only licensed neon product manufacturer in the country," Vickers said of his mascot line.

"We've gone to two trade shows where people can actually see them. People just go nuts. The response has been overwhelming."

VICKERS' plan is to wholesale the neon signs to the 3,100 college bookstores across the country.

The product is a natural for Star Signs, Vickers said.

"We probably do more neon than any other sign company around. We like working with it and we're good at it. And this is important: We're one of the few UL-listed sign manufacturers in the area."

Vickers said the nearest competitor whose neon products passed muster with Underwriters Laboratories' safety inspectors is in Kansas City.

Another of Star Signs' thrusts in these trying times is to make sure its existing customers are happy, Vickers said.

That means meeting deadlines and not being sqeamish about paying overtime.

"There's no way in hell that we could service national accounts and miss deadlines," he says, noting that national clients can choose from a wide variety of sign companies and are being solicited constantly for their business.

"Somebody told me once that you're only as good as your last delivery," he said.

VICKERS has been sole owner of Star Signs since 1987, when Bob Nitcher, one of its co-founders left the company. Nitcher and Preston McCall started Star Signs in 1979. Vickers joined a year later, and he and Nitcher bought out McCall's interest.

Vickers said he can tell that his company, which now employs 32 people, isn't the only one being pinched in the current economy. A handful of competitors in the Kansas City area already has closed.

He said the economy also injects some uncertainty into the business of going after national accounts. It's quite possible, he said, that some of his clients might not survive the slump.

But Vickers thinks Star Signs is well positioned, and he sees an upside to the current shakeout in his industry.

"Once it's all over, when you make it through, maybe there are more opportunities there," he said.

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