Billboard Monthly

March, 1st 2013

Memo From Frank

I just got done teaching a Billboard Boot Camp, and I find it real exciting that there are people who are interested in building up billboard operations. It reminds me of how excited I was when I started in the industry. The only difference is that they are spared the idiotic mistakes I made from having absolutely no knowledge of how you find, build or rent a billboard. My most awkward moments were those before I built my first sign, since I was simply bluffing the answers to most questions without any real idea what I was talking about. It was a miracle that I got my first billboard. But after that first one, I now knew the answer to such basic questions as “so where do they drill the hole” and “how do you put the top on it”. Hopefully, I’m able to save people about a decade of learning curve. If I started again today, as stupid as I was back then, I’m not sure if I’d ever even get one sign unless someone had pity on me. It’s sure a lot easier when you know how things work and already have the tools ready to do it.

When Can A City Have Too Many Legal Billboard Locations - And What To Do About It?

Normally, the biggest problem in most cities is finding some legal locations to build new billboards on. But in rare cases, you can come across cities that have too many legal locations to build. The danger in these markets is that they could become completely overbuilt overnight, and render your investment in trouble due to much greater supply than the demand warrants and a plunge in advertising rents. So how does this happen, and what can you do to protect yourself?

Too much frontage with commercial zoning

The first market I ever discovered with a potential oversupply problem was in a small town on I-45 about 45 minutes south of Dallas. The problem was pretty basic: they had 5 miles of commercially-zoned frontage on both sides of the highway. Apparently, the city though the best way to hike property tax was to have a giant commercial zone. But the end result was that there was – even at 1,000’ spacing – the possibility of around 50 billboards going up overnight. That would equal about one billboard for every business in the entire area! With that kind of oversupply, renting ad space would be nearly impossible.

Sudden change in laws

Other situations that have risked oversupply are cities that did not allow billboards, but suddenly change the ordinance to allow for new sign construction. When you open an entire city to billboards in one day, you totally overwhelm the ability to effectively market the advertising space. It’s one thing if you build a few new signs each year and absorb the ad space on a continual basis, but another to open the flood gates all at one time.

Defense number one: change the centers

Typically, a billboard operator is focused on shoehorning a new location in between two existing ones, straining to get that last foot to make it legal. But when you have too much legal frontage, it’s sometimes a wise strategy to figure out spacings that deny the maximum signs to be built. Here’s an example. Let’s say the spacing between billboards in a given market is 1,000’, and say you’ve got 4,000’ of frontage that you can build on. In a normal market, you’d put one billboard at one corner, and then space the signs one every 1,000’ – that’s the maximum the property can hold. But another way to do it – when the market faces oversupply – is to put the first sign in the corner, and then the next sign 1,990’ down the road, so that you can’s stick another sign in between them. Based on this example, the standard way would allow for 5 signs, while the exclusion method would only allow for about 3.

Defense number two: keep only the best

Another defensive posture is to only pursue and build the best of the locations, and let everybody else do what they want. If you keep the signs with the best visibility, curves in the road, etc., then your signs should theoretically rent before all the others, so the oversupply will be survivable. And the more that the other companies try to sell the space, the more it just drums up business for you, as the advertisers want your signs first. In addition, every time your competitors rent a sign, you know that it’s a logical choice for that advertiser to move to your sign when it comes available – they are actually just pre-screening clients for you.

Defense number three: little permit holders

Let’s say that you might want to build out more locations in the future – you’re just concerned about trying to rent all that space at once. A third solution is to warehouse the permits with tiny signs that are only designed for that purpose. I did this on some locations in East Texas once. I built little 1’ x 1’ monopoles (about the size of a “house for sale” sign) and pulled all the official permits. When I wanted the location later, I could just file for a demolition on the little sign and put up a real sign. The only danger from this strategy is if they change the laws – then you are stuck with little signs you can’t rent.


Although it’s rare, there are times when you find markets that have too much capacity. These steps should allow you to control events, and release only the amount of ad space that can be rented and absorbed based on demand.

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A Billboard Story

I was always obsessed with trying to be outdoor license holder #1 in the State of Texas. I thought that it would be neat to have as my license number on all applications and transfers, #1. But I was unable to ever locate the folks that held that license (who were probably long dead). If you are starting up and want to give yourself instant credibility, you might look into buying out an ancient operator, and then taking over their name and license number so that you can say “We’ve been in business since 1944” or whatever year they started. This tactic has been around in consumer goods for years. For example, I recently bought my wife a bottle of perfume that claimed to be made by the same people that had done so since around 1750. However, it turns out that the guy merely bought the name of the old perfume company from 1750, and the legacy was just a marketing gimmick. So if you are working on finding sign number one – and there’s somebody out there who started in 1960 and has only one old wooden sign – it might not be a bad idea to buy that sign and company and go proudly to meetings saying that you’ve been in the sign business since 1960. Think about it.

A Tribute To The Hardest Landowner To Ever Deal With On A Billboard

People in the billboard business in Texas have often heard the tales of trying to negotiate a billboard lease with O.L. Nelms. Long deceased, O.L. Nelms made a fortune in the cigarette business and other basic commodities back in the 1940’s and 1950’s. He then used that money to buy land circling the Dallas/Ft. Worth metroplex. Soon, just about every highway built in the Dallas area had to pass through land owned by Nelms. The end result was that he had a large number of billboards on property he owned. Nelms developed a unique negotiating style, that was still being talked about when I got in the business in 1982. Here’s how it worked. He’d pretend that he could not read and write. So he’d have the billboard guy read him the lease. Over and over and over. Then he’d tell them that he needed for money. So they’d come back again and read it to him over, and over, and over. Then he’d tell them that he still needed more in order to sign the deal, and pretty soon they’d give him anything he wanted if he would just stop making them read the lease to him. He used this same tactic, with great effect, with the Highway Department in negotiating right-of-way sales and easements.

The Case-Hardened Bolt - The Unsung Hero Of The Monopole

Monopole Billboard Bolt

One of the key items that make a monopole billboard possible is the invention of the case-hardened bolt. These bolts are subjected to extreme temperatures and the introduction of carbon to make the exterior extremely hard, but the interior still strong and non-brittle. Without case-hardened bolts, it would be hard to make the two surfaces of the monopole – the plate and the saddle – stay together with extreme wind loads and awkward dead-weight loads. There are typically 12 to 16 of these bolts in a monopole structure, to be found in the plate at the top of the pole. There was a scandal involving case-hardened bolts about twenty-five years ago. Case-hardened bolts can be recognized by special markings on the top of the bolt. Since they are much more expensive than regular bolts, an overseas manufacturer realized that they could sell cheap bolts for huge mark-ups by just replicating this code system on the top of regular bolts. As a result, several monopole signs collapsed since the case-hardened bolts were frauds. Many billboard owners – including myself – paid people to climb up and check each bolt to make sure that it was legitimate. By now, any that were fake have already broken. So when you see that monopole structure proudly standing 80’ in the air, remember that it wouldn’t be there without the case-hardened bolt.

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