YESCO SIGNS

SIGN LANGUAGE: YESCO SAYS LAS VEGAS TO MILLIONS OF PEOPLE

Exclusive Interview with John Williams

As Las Vegas division manager and ice president of Young Electric Sign Co. (YESCO), John Williams has a lot on his hands.

He is responsible for more than 400 employees and at least a portion of the image of some of gaming’s most successful companies.

But with a firm handshake and confident nature, he seems to take it all in stride. He should. He’s got a lot to feel confident about.

His company is considered a dominant force — it’s the third largest manufacturer in Las Vegas – in one of the industries that helped create the public image of Las Vegas.

It can draw on a long history of gaming experience. Founded in Utah in 1920, YESCO has been a mainstay in the region’s sign business and has created many of Las Vegas’ most famous landmarks.

YESCO created Vegas Vic in 1951, the Fremont Street Experience in 1996 and is building the new Las Vegas Hilton sign (YESCO didn’t build the first version, which blew down in a wind storm last year). Typical gaming signs today sell for $2 million to $5 million.

Williams, who has been with YESCO for just over four years , sat down with Business Press reporter Thomas Moore to talk about how the sign business works in Las Vegas.

YESCO is based in Utah. How many employees do you have in Las Vegas?

We have 355 here and about 110 in Reno. So in Nevada we have about 460470.

What do you think is the most famous sign that YESCO has created?

Well, historically Vegas Vic has been around since 1951 and I would imagine probably 50 percent of the pictures of Las Vegas have Vegas Vic in them.

There is also the Circus Circus clown and the Hard Rock’s guitars. We’ve done a number of guitars for that company. Some of the older signage is memorable and certainly Fremont Street is growing in popularity. The Rio has been a beautiful sign that has grabbed people’s attention for many years.

How competitive is the sign business in Las Vegas?

It really is extremely competitive. Any time there is a hot market you have not only the older competitors but also the newer competitors moving in. There are companies which come in from out of town who have been looking at our market for a number of years. When it heated up they moved in.

And there are also people who have wanted to start a business or enhance an existing business. We’ve gotten both contingents here that work against us as competitors. And there are also the more dominant companies who have been here for years. It is very competitive.

But I would think your company has a bit of an edge having been in the area for so long?

We try very hard to re-earn our credentials every day. We try to delight every customer. We try to exceed expectations every time we do a job so we keep that edge. And it is very difficult to do that sometimes.

I would have to say yes, we do have an edge because of our historical perspective. But we also recognize that we must stay on the leading edge in every way.

Las Vegas has some of the most creative architecture in the world and every gaming company wants to stand out from the rest. How hard is it to create compelling signs and keep the gaming companies happy?

It’s very difficult. One of our major challenges is maintaining a highly creative approach that is in-line wit h their thinking. There are several ways that occurs: One is we can become their source of information, of creativity.

They may have some concepts themselves that we try to enhance and elaborate on and make realistic. Sometimes we have to be very careful about what we suggest because sometimes their expectations are higher than what reality can dictate.

The second way it works is we will have a collaborative effort with their design group or an external group of architects or designers that they hire.

We have had some very significant success with collaborative efforts. One good example is the rebuilding of the Hilton sign. We worked on that with Communication Arts from Colorado.

So there are a number of ways that those creative juices start to flow. But it can be a great challenge to maintain that creativity.

What are some of the things that gaming executives ask for but that can’t be done?

Well in some cases the expectation far exceeds what we can give them. But we try to turn that around. That’s one of the unique things about our approach. We try to say ‘Let’s enhance it even more. Here are some additional bells, whistles, and buzzers you can have by doing it this way.’ Our goal is to exceed expectations and not just meet them.

Now in some cases someone will come to us and they will want a sign 500 feet in the air and they’ll want it on a tiny little member which structurally can’t take that kind of load.

There is already so much very unique engineering that goes into our signs. But say they wanted a 500-foot neon palm tree. That would be very difficult to make because a single vertical member like a tree trunk would need some additional structural support. That kind of sign becomes a challenge.

How long does it take to create a large casino sign from the initial idea until the lights are turned on?

Sometimes in can be a matter of days and sometimes it can literally be a matter of weeks or months. A lot of it depends on the complexity.

For example with the Fremont Street Experience we went through two large full-blown demonstrations and literally months of engineering and re-engineering and rethinking.

Just to pick the skin of the Hilton sign took a long time. We had the basic structural design. But for just the skin alone we did at least a dozen full renderings.

We also did another dozen renderings with placements of embellishments on the structure. And we did another group of renderings that had nothing but variations of letterings.

So there is a lot of evolution that needs to take place and unfortunately a lot of decisions are made by committee and that makes it very difficult. When we get into a situation where there are five or six decision makers it gets very frustrating. Design by committee is just a nightmare for us.

But there is no way of avoiding that is there? I would imagine that many of your clients are public companies that have a raft of vice presidents and senior vice presidents?

We try to be very understanding of that type of situation. Unfortunately in most cases it puts us in a very highly compromised position with respect to delivery. They are spending nine months on a project and we don’t get it finalized until we’re into the six month. Signs are always the last thing that goes in so we are always under the gun in a very large way.

How do you deal with clients who constantly change their minds? Because you can’t mass-produce signs I would imagine it is very frustrating?

We face those challenges all the time. Either it’s ‘We had no idea it was going to cost that much,’ or it’s ‘Gee, I don’t like it that way. Let’s try it another way.’ Both of those we face every day.

But it’s not like you could sell that sign to someone else is it?

Exactly. Therefore we are very careful about detailed design, full disclosure about the sign, and customer approval of the design.

We have all of our prints signed by the customer and we explain it all in full detail. We say ‘Here’s what to expect, here’s what you are going to get, here are the details, and here are some samples.’ In many cases we do full-blown mock-ups.

We started doing mock-ups about four years ago. Typically that is our best selling tool because it shows the customer exactly what they are going to get. It is very expensive to do that but nonetheless we feel it is absolutely critical to show them what they are getting.

Is there [ever] a payment issue where someone sees the finished sign and says “That’s not what I wanted”?

Oddly enough we don’t have the problem with unsatisfied customers although we do go to court over payments sometimes.

Our sales force is trained in every sales meeting that every single communication should be qualifying the needs of the customer.

In other words do they have money? Are they going to use and abuse us? Do they know what they want? if they don’t know what they want are they going to take our suggestions?

So we try to qualify that customer from the moment we walk in the door and we continue that process until the sale is made.

So when the sale happens the salesman better darn well know what the customer wants and the customer better know what they are getting. The salesman has the tremendous responsibility of full, open, credible and honest disclosure.

Then, and this is one of the tremendous advantages of our company, if they don’t like it we will fix it until they do just so we have a happy customer.

Each sign can be so different from the next and even though gaming companies want them to be spectacular they still have budgets to meet. How do you price these signs?

Very carefully. And budget issues are always a challenge. We generally try to quality the customer’s budget. It’s one of the first things we try to do.

We try to work within their limitations so we ask, point blank, “How much do you want to spend,” and then we price within those parameters.

Our estimating department is matte up of only our very best journeymen because they literally have to build the sign in their hearts.

Our pre-sale functions are design, engineering and estimating. The job goes around and around in those departments until we know how much time and material it’s going to take and whether it can even be built.

Those three departments have to work very closely with each other on pricing. That’s a problem all by itself because you have designers who don’t understand engineers and you have estimators that are asking the engineers, “Gee, are you sure we need to use something that big? Do you know how ranch that is going to cost?” So coordinating those three pre-sale departments becomes critical.

Still our estimators must literally build the signs in their heads. They have to estimate the number of man-hours required, the amount of material needed and if we have the capacity to do certain things.

We like to control as much of the process as we can in-house. We’ve added several different departments in the last several years so we could do that.

We have a full blown fiberglass department, a sculpting department, a huge electronics department, an interior gaining slot department, a little machine shop and we’ve added laser equipment and programmable punching equipment. In fact we’ve added every piece of equipment needed to meet the expectations of the customers.

You were saying there are some lawsuits over payment?

Unfortunately we budget a certain loss percentage a year. But we have yet to exceed that loss percentage.

Yes, we do go to court a lot. It’s unfortunate. Sometimes customers have not analyzed their market sufficiently. They think they are going to be able to pay us and sometimes they can’t.

We are a little more prone to heavy exposure than other companies because we offer more financing options than any other company I’m aware of. We have done our own leasing for well over 50 years and we have a huge in-house company held leasing portfolio.

That puts us in a position to be compromised so we do a lot of due diligence and a lot of homework. We are literally going to get married and become business partners for three years, five years even ten years in many cases. We want to know our business partners are as sound as we are.

In the past casinos were very simple buildings and the signs expressed the theme of the casino. That has changed.

Do you think some of the gaming companies are moving away from buying more interesting signs because their buildings are so interesting all on their own?

We are seeing some very interesting revolutions taking place in this business. Let me give you two very good examples.

The Desert Inn’s sign is an architectural element. It is very elegant and very simple. But it really is just an elegant architectural element with a logo and a message board. That’s all it is.

However, at New York-New York the gawk factor becomes involved. We had to do some one-upmanship on the porte-cochere (roof projecting over the entrance) to make it additionally visible because of all the other elements that are so incredibly visible.

Are there certain things a sign has to do to be successful?

Well visability is the single most important concern. Creative visual appeal is another very important aspect. We also have to adhere to certain sizes of letters and certain fonts that are easy to read.

Take a sign that needs to be read from three quarters of a mile compared to one a half a mile away. The letter sizes would have to be different to be readable. The sign itself would have to be a certain height, sit at a certain angle and be of a certain size to work in one location compared to the other.

To figure all this out we do what we call flaggings. We take a large single letter and hang it at a given height to determine how high a sign needs to be to be seen from the various locations.

For example, we were working on the corner of Tropicana and the Las Vegas Strip at the Tropicana Hotel to determine the height a sign should be in order to be visible from all locations at about 270 degrees around that corner.

To provide readability, and visual attraction from a number of different locations becomes a very difficult thing to do in many cases. That’s the challenge of the sign business.

We were also concerned, for example, about the sign at the Desert Inn. It has a very beautiful script logo which is just the letters “D-I.” The stroke on those letters is very narrow and is very hard to see.

But it was necessary to reproduce that logo. in some cases we struggle with these issues and would like to use other ways to make the sign.But we had to honor the logo.

Do you think people miss the older signs like the Sahara’s that was just removed?

Yes i think they do. The Dunes for example, was a great old sign. in fact our scrap yard has become the focus of a great amount of interest.

There have been video shoots, movie shoots and fashion shoots in our graveyard.

Also, there are about 45 old signs that a conglomeration of the city, Fremont Street and some individuals have asked could be put out on Fremont Street in what is an open-air museum.

We are in the process of refurbishing and making them acceptable for the current building codes. These signs are truly part of the architecture and history of Las Vegas.

I know your gaming clients want spectacular signs, but are they ever concerned with energy efficiency or ease of maintenance?

Well they are not particularly aware of the maintenance aspects. But we try to make that a part of our signs.

That’s because you service them?

That’s correct. And we want them to be very serviceable so in many cases we will make the cabinets a little deeper and a little larger so we can get our employees in them. But not many of our clients are aware of those things.

As for efficiency it is becoming more and more of a concern. One of the things driving that move is our casino clientele wants the signs to be extremely flexible. That usually means electronic message centers.

A good examples of typical message centers are the Texas Hotel and Gambling Hall’s sign, the Orleans sign and the Desert Inn sign. All three of those signs have extremely high-end wedge-based electronic message units.

The Texas unit, for example, has over a 180,000 lamps in it and they consume a tremendous amount of energy. But that is the price that must be paid for that kind of flexibility.

Several years ago the only lamps available for message boards were reflector lamps that were much larger and much less efficient in terms of their visual angles. Now we have very sophisticated optics that control the horizontal and vertical distribution of the light output.

That allows us to use less light output and distribute it in the visual planes. Before it was much less efficient. So we are very much trying to increase resolution and decrease energy consumption, thus increasing the energy efficiency.

Has the spread of gaming around the country meant increased business for Yesco around the country?

Yes. We just finished a large project in Kansas City for Station Casinos. We just finished a smaller installation in St. Louis for Players. And we are working with Showboat in Gary, Indiana, on a four-deck boat and terminal.

We try to follow the stronger gaming venues wherever they might be. That’s a function of our need to do business with qualified clients.

How much of your business in Las Vegas is from gaming as opposed to non-gaming?

Well you could say most of Las Vegas’ business comes from gaming. But compared to business from places like car dealerships and fast food chains, dollar volume (in) gaming is about 80 percent of our business.

Of the roughly 80 percent that makes up our gaming portion, probably 10 to 15 percent is out-of-state. Well, I take that back, it may be higher right now. We just did a huge job in Uruguay. It’s going up all the time and we want it to.

We have geared the company towards serving markets in other areas. We’re adding 50,000 square feet to our shop right now, principally to service the worldwide proliferation of gaming.

Is it necessary to have a large budget to produce a unique sign?

No. Absolutely not.

Can you give me an example?

Well one of the things we offer is sculptural dimensional product. It can add tremendous value to a sign but the cost is not that great.

We sometimes refer to simple signs as boxes and faces. And we don’t like boxes and faces. We like highly creative, dimensional signs. And we can do that with sculpted media, with fiberglass and with foam.

We have an incredible urethane foam system that allows us to do things that: until now couldn’t be done.

What we are doing is melding creativity and technology and that is always a huge challenge. But in doing so you get a better product at a lower price.

It sounds like you have to have a lot of people with a lot of different technical talents working at YESCO. Where do you get your employees?

I don’t know if any other industry or business that has as broad a spectrum of employees as the sign industry. We have the most creative designers and the most rudimentary shop clean-up staff. We have structural engineers, civic engineers, estimators and at least eight trades all within the business and it’s a challenge to make sure they all work well together.

I think maybe the auto industry and certainly companies that create theme parks, like Disney, are the only similar industries that combine the mechanical and the creative disciplines in the same way.