Increased tariffs on outdoor advertising may cause increased attention to KRA

Local authorities on the annual increase in tariffs for the rental of seats under the construction of outdoor advertising can result in a rather unpleasant conversation with representatives of the Control and Revision Department (KRU). Especially if the tariffs were increased in times of crisis, when the outdoor industry has been confronted with a catastrophic shortage of advertisers and was forced to significantly reduce the price of accommodation.

As the press service of KRA, the work of KP Kievreklama in 2007-2008. was not effective enough. In particular, the company has not implemented in 2008, the scheduled payments to the city budget in the amount of 12,9 million UAH. The fault which, as already mentioned, unjustified increase in tariffs for operators of outdoor advertising during a recession. Recall that in late October 2008 KSCA raised tariffs on placement of outdoor advertising in 1,23-8,7 times. Previous growth rates was in August 2007 (rental rates increased by 15-20%). And the October increase literally shattered capital naruzhnikov which, in addition to the general crises in January 2009 and have lost two of these fairly large group of advertisers, like alcohol and tobacco industries.

Fortunately for operators outside of Kiev, the capital authorities nevertheless made concessions to the market and in early September, officially cut tariffs by 28,6 - 33,3%. At the head office of advertising at KSCA, which has developed a draft order in the spring, to explain such a step not only the desire to support the capital's advertising market in difficult times for business but also the need to ensure a stable flow of funds from advertisers to the city budget. Up until that debt to gorbyudzhetom virtually all companies operating in the market, grew the greatest possible speed. In this case the projected income from naruzhnikov this year should total about 140 million UAH. (in the past, emergency preparedness, this amount was at the level of 120 million UAH.).

Alex Kurman, director Kievreklamy, in a recent interview, said: Although the economic crisis and its negative adjustments made, I hope that we will arrive at the required level. That is, execute the task and send to the Treasury projected amount. Will this in view of reducing the overall fleet advertising in Kyiv (according to the UMM, the end of last year, the number of planes is about 23 thousand, whereas in the early fall of 2008 - about 22 thousand) will be seen in early 2010 In the meantime, it is clear that Kievreklama is likely to tighten the conditions of cooperation with operators. Reason - KRU remark to the effect that Kievreklama does not use the possibility of unilateral termination of contracts with operators, as well as enter into contracts with notoriously unreliable partners, which is the reason for the growth of receivables.

However, the results of testing KRA allow naruzhnikam hope that the authorities have other cities, where prices can not be called liberal, follow the example of Kiev, reduce tariffs and become more efficient to fill gorkaznu. The most difficult situation with the tariffs now observed in Kharkiv and Donetsk, - said Artem Bidenko, director of the Association of outdoor advertising. Even small towns are not understood by the tariff policy. Last week, for example, Smelyansky municipality (Cherkasy region) decided to raise rates nearly tripled.

Many small towns are taking as an example of over one million fares and impose inadequate rates, not realizing at the same time that the market is the same brave and, for example, in Kiev or Kharkov - is totally different markets, - said Bogdan Dubovik, head of the Union of enterprises outdoor advertising.

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