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Multiple woes hit outdoor advert sector

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By Princewill Ekwujuru

*Operators complain of unpaid bills, zero orders, regulatory issues

Operators of outdoor advertising business in Nigeria say their survival is under threat if government fails to come to their aid, as they accuse the Lagos State government of owing them  over N1 billion.

advertThe N1 billion is the total sum resulting from allotted sites for President Muhammadu Buhari and Governor Akinwunmi Ambode’s 2015 election campaign, Financial Vanguard, FV authoritatively gathered.    The practitioners under the aegis of Outdoor Advertising Agencies of Nigeria, OAAN, among other things decried the inability of member companies and clients to access foreign exchange to bring in raw materials for production.

The Association also complained of high rate of charges by states on both redundant and  occupied billboards.

President of the Association, Babatunde Adedoyin told FV that the sector is groaning under serious economic crunch which is noticed on about 70 percent of member company billboards nationwide.

Adedoyin also noted that the present economic situation is forcing clients to cut their advertising budget which has taken toll on member companies.

Speaking to FV, the OAAN  President said: “The economy for us is in total recession, in a situation like this, there is no way it would not affect our industry. As we speak, about 70 per cent of our billboards are redundant. Clients are cutting budgets. Some are not sure of what they want to do this year and some can’t even access foreign exchange to bring in raw materials and since they do not have raw materials they can’t produce, hence they can’t advertise.

“For the first quarter of this year, there are no media orders from most companies, some of them are still trying to put things together because of the uncertainty that we are facing today. That is the basic truth and I can’t start mentioning organisations. Some are even owing the last two quarters of last year; I am talking about multinationals.”

Adedoyin went further to say, “the regulators are looking for money; Lagos State Signage and Advertisement Agency, LASAA is trying to collect money at all costs and everybody is looking for ways to get money from operators because allocation coming from the centre is little or nothing, therefore most of them are now thinking that there are internally generated revenues, IGR, and unfortunately those of us they are trying to get the money from are having the same problem.

“Our clients are not doing well, they are not giving orders, they are not paying. This is not peculiar to Lagos it is in all the states. Right now, our boards are being pulled down in Kaduna, Rivers, Abuja and we have been to all these places and the story is all the same except that charges in Lagos is higher may be because they are the pioneer of these agencies. For sure, we don’t have any sympathy from them, that is the truth.”

On whether Lagos and the association have been able to strike a rapport, he quipped:

“First and foremost we have not settled anything with Lagos. We are still discussing. We are trying to arrive at an amicable solution.    We are praying and hoping that in a short time this would come to an end. You know this is a professional association and as a company you are compelled to practice in all the states of the federation. We have some of our members practising in the East, in the West and those practising only in Lagos, and whatever policy that we have, members should be safe whether practising in Lagos or elsewhere. That is why we decided not to hold our annual general meetings in Lagos alone.

“As I speak someone is in Kaduna and Abuja doing some discussion with the regulators there. It is a professional association and the policy is the same whether you are in Lagos, Abeokuta or Uyo their problem there is our problem here. Because today you might be in Lagos and tomorrow may want to practice in Uyo.”

On what drives rates, Emmanuel Ajufo, Vice President of the association stated that “there was a fixed rate, but with the advent of LASAA, the rate went up by over 1000 per cent and so the regulators want to make money, but like we keep telling them, Nigeria today has oil but have nowhere to sell it.

“We are telling them to allow us pay to the extent we have also received but they are not reasoning, and we must get them to understand that.    “If they can take what has been received, then they should also allow us to pay what we have also received.”

Corroborating the President’s statement, Ajufo said further that the association has been battling with LASAA on the issue of vacant billboards.

He said: ”We are the endangered specie, whatever money we spend, come from the advertisers.

“The regulators still insist that we must pay them the same amount of money we pay when the billboards were occupied. Where do they expect us to get the money from?”

On raging debt controversy, the VP admitted that members are owing LASAA, but it is as a result of charges on vacant billboards.

“We are saying to LASAA that we did a job for them and we had an agreement with people that gave us the job and LASAA is saying that they do not know that agreement and we believe that government is a continuum and very soon this present management of LASAA will be a thing of the past. I do not know why people do not learn from the past. I don’t know OAAN will enter agreement with somebody and when the current leadership departs and another comes in and it will begin to say it doesn’t know anything about such agreement. We are still talking about this thing and we expect LASAA to set aside those debts until we resolve them because we are claiming that money and he is saying that he doesn’t know about the money and he is still dealing with us on the account of the money that we expect him to pay us.

Continuing, the VP stated: “it is not possible for us not to owe because we can’t walk into the bank and take a loan to pay for vacant billboards. We believe as regulators, they must understand the environments they regulate and they must also know that a percentage of what we give to them come from advertisers and they (advertisers) have the right to take their money to anywhere they want. We are here today talking about this rate being too high and we are asking them to bring it down and let us pay as we received, but they said no.

“Presently, we are having issues in Kaduna, don’t    forget    the present    Kaduna governor was the one who did what he did in Abuja so he wants to do the same thing in Kaduna. They started by saying beautify the environment and at the end of the day it is rate increase and so it is very clear we need to come down to address this issue.”

LASAA’s defence:

The said Lagos State Signage and Advertisement Agency, LASAA, the agency saddled with the responsibility of regulating outdoor practice in Lagos, was said to have   embarked on Save Our Soul agreement on behalf of the APC to rally support for its candidates both within the State and at the federal level through the provision of sites for adequate exposure.

Although the agreement was said to have been reached by both the regulator and the operators prior to the election, the new administration of LASAA led by Mobolaji Sanusi has denied any arrangement or deal claiming that the former helmsman, George Noah, acted on his own.

Sanusi while denying the claim stated that the party made available some funds for the execution of the campaign and as such the immediate past head should be held responsible to account for it.

While LASAA under Sanusi is insisting that it was the operators that owe it for the stated period, the operators believe the new administration was being unfair by asking them to go after Noah for the payment when the agreement was reached.

To the operators, it was quite surprising that the same LASAA whose staffers were privy to the agreement could make a U-turn on the issue.

The operators further revealed that some members had to relinquish previous agreement reached with the Peoples Democratic Party (PDP) in order to key into what the regulator proposed to them.

Part of the agreement reached between both parties, according to a source, include defraying the cost incurred by each of the operators on the usage of their sites for Buhari and Ambode campaigns by clearing off either part or all the debt owed.

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