Inflation has increased from 1.5-2% annually to 7-8% annually. Take a look at this chart. Source: US Inflation Calculator When you drill down into the numbers you can see that inflation picked up in the last half of 2021 when the last round of covid stimulus vastly expanded the money […]
If I told you that the economy grew at a 6.9% annual rate in 4th quarter, that we just ended the strongest year of growth in nearly four decades and that the national unemployment rate was at 3.9%, you might be feeling that our future is very bright. You would […]
Chart Source: US Inflation Calculator The US inflation rate accelerated to 7% for December 2021. That’s the highest inflation has been in 40 years. Cost pressures are impacting out of home. Vinyl input costs are up more than 30% from pre pandemic levels. Shipping costs are up nearly […]
A November 2021 New York Times headline says it all: The Bond Market Says Inflation Will Last. You Should Be Listening. The article appeared shortly after the bond market’s 5 year inflation expectation rose to 3%. The consumer price index (“CPI”) rose to a 30 year high in October 2021. […]
This chart says it all. Inflation (e.g. the 12 month change in the CPI) has increased from an annual rate of 1-2% up to 5-6%. Too early to tell whether this is a short term post covid supply shortage phenomenon or long term inflation induced by an increase in the […]
Is inflation picking up? Steel Prices are up 75% over the past 12 months. Here’s some narrative from a steel market newsletter:”…due to a variety of factors, the North American steel mills are operating the available assets at a lower rate than previous years. If that is coupled with a […]
You need to keep your billboard lease increases to less than 2%/year. Here’s an actual lease Insider has reviewed. Payments are as follows: 2014-2017 $2,000 per year. 2017-2020 $2,500 per year. 2020-2023 $3,000 per year. 2023-2026 $3,500 per year. 2026-2029 $4,000 per year. A $500 […]
Insider has updated the inflation and US out of home revenues table. Bookmark this when it’s time to negotiate a billboard lease cost of living increase with your landlord. Inflation has averaged 2.2% over the past twenty years. US Out of home revenue growth has averaged 3.1% over the past […]
Avoid lease inflators in excess of 1-2%/year or your cashflow margin will erode. That’s the lesson of the chart below which compares US annual inflation with US out of home advertising growth since 2000. Inflation and out of home revenues increased 1.6%/year and 1.2%/year, respectively since 2008. Inflation and out […]
You need to keep track of historic inflation and expected inflation so you don’t agree to billboard lease inflators in excess of inflation. Same thing applies to the renewal of ad contracts. You need to get at least some increase in price on every ad renewal or inflation will be […]
