At Gelberg, their signs point to growth

At Gelberg, their signs point to growth

Gelberg Signs is a company dying to get bigger.

Luc, Neil and Guy Brami, the three brothers who own the District-based manufacturer, are looking for an investor who will provide the $5 million they need to go national.

“We would like to find an equity partner to give us a cash infusion,” Guy said. The five-year plan is to take revenue from $7 million to $24 million a year.

Part of the plan is to find some big national companies looking to roll out hundreds of new stores or locations (think Wal-Mart or the latest fast-food fad). Another part is to win every sign contract on a construction project in the District, where the Bramis keep a close eye on future development, following zoning meetings, D.C. Council hearings and anything else that will give them an edge on a job.

Luc is 54, Neil is 49 and Guy is 43.

Gelberg Signs was founded in 1941 and makes signs that direct you to everything from a restaurant to a restroom. Their prices can range from $30,000 for a custom-made lighted sign for a downtown Washington restaurant to $10 for one of the hundreds of restroom signs hanging inside a big office building.

Been to a Roy Rogers lately? It’s a Gelberg sign that beckoned you. They are on the outside, and almost everywhere inside, of baseball’s Nationals Park in Southwest D.C. Gelberg made the signs on every California Tortilla, the Children’s National Medical Center and the Walter E. Washington Convention Center.

Cuba Libre, the new restaurant in Penn Quarter, has a Gelberg sign. If you drive the New Jersey Turnpike, a Gelberg sign tells you which restaurant is at the next travel plaza. Gelberg will put your brand on coffee mugs, keychains, pens and pencils. The brothers are politically agnostic; they will make signs for any political party and candidate.

Gelberg grossed $7.2 million in the fiscal year ending June 30, 2010 and expects to gross more than $10 million in the year ending next June. The company has operated out of its Northwest Washington location since 1966, where it occupies 50,000 square feet in an industrial area.

Gelberg’s net profit margin before taxes ranges from 3 to 5 percent, depending on how many orders for high-margin, custom signs they get in one year. The brothers pay themselves a salary and some bonus from the profits.

The Brami brothers are ambitious and politically savvy businessmen who are active in business organizations. Luc sits on the board of the Washington, D.C. Economic Partnership, and the brothers stay in touch with the D.C. Chamber of Commerce.

Their father was an impressionist painter who arrived from Tunisia in 1956 with a few bucks in his pocket. Unable to find work as a painter, Georges Brami hooked up with Bill Gelberg, who had a little sign company in D.C.

Brami, who had some business smarts, soon became Geldberg’s right-hand man.

When Gelberg died in 1977, Brami took over running the company for the Gelberg heirs. He used a connection with Marriott International to make the signs for the company’s growing consumer restaurant business, which at the time included the Pappy Parker and Jr. Hot Shoppes brands.

The company did pretty well under Brami until 1987, when the Gelberg family decided to sell the firm to outside investors.

Brami, in his 60s at the time, retired a couple of years after the takeover. The company tanked under the new owners, and Brami’s sons bought it in 1989 for $100,000 in cash plus picking up the company’s $750,000 debt.

Then they went to work.

Their contacts at Marriott told them that the hospitality chain was getting ready to ramp up its Roy Rogers brand, whichwould mean millions in new signage work for Gelberg, which already had the contract.

Between Roy Rogers, Bob’s Big Boy restaurants and Marriott Hotels, the hotelier was accounting for up to $1 million a year of Gelberg’s revenues, half the company’s business.

But in 1991, when Marriott decided to get out of the fast food and restaurant business, the Bramis faced a crisis. Losing Marriott, amid a recession, was going to devastate revenue.

“We didn’t want the ‘Sears effect,’ ” said Luc, referring to suppliers who depend on one company for business. The Bramis become more aggressive marketers, attending restaurant association conventions and adding salesmen.

Marriott came to the rescue again, however, when a former employee there hired them to do the signage for his new employer, Philadelphia-based concessionaire Aramark. That gave the Bramis enough breathing room to go out and market themselves, where they landed contracts creating menu boards for restaurants such as Jerry’s Subs, Chicken Out, Ledo Pizza, Chesapeake Bagel Bakery and others.

The firm grew slowly over the next decade. But by the early 2000s, Gelberg realized it was getting only a tiny fraction of the work on large private and government office buildings in the Washington area.

They borrowed $500,000 through the Small Business Administration, hired several managers and started focusing more on business development. They pushed marketing, contacted more politicians and developed strategic partnerships with nonprofits and public works programs.

Thanks in part to a program that promotes D.C. companies in construction projects, Gelberg went on a tear. It won a series of contracts, including a $1.7 million, two-year deal to provide most of the signage for Nationals Park. They started getting contracts for the D.C. Public Schools. They won the Children’s National Medical Center contract. They did a big chunk of the signage around the redevelopment of Columbia Heights.

Their share of business in the District, both public and private, has gone from 1 percent of Gelberg revenue to 30 percent.

The Bramis now have their eye on capturing the signage for the billions of dollars worth of construction projects that are expected to be completed in D.C. over the next decade. Between 1 and 2 percent of a building’s project cost is spent on signage, which would come to about a quarter of a billion dollars.

The Bramis are positioning themselves for big deals. They recently changed their name to The Gelberg Companies and added two new businesses: an online express Web site and a “green” division that retrofits buildings with energy saving lights.

The brothers think a $5 million infusion from an investment partner could launch them into the big time, allowing them to work with steel and aluminium and more complicated computer equipment.

They’ve had some investment inquiries after a highly publicized visit by President Obama last July to promote jobs. But the brothers said they are probably just going to have to work their contacts in the business and political world before they get traction with investors.

“We’re three sons of immigrants who figured it out the hard way, through trial and error,” said Luc. “It’s just sweat and hard work.”

This article appeared in the Washington Post, October 31, 2010
http://www.washingtonpost.com/wp-dyn/content/article/2010/10/31/AR2010103103466.html

 

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