CEDIA: Residential Install Revenues Rising Again

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Indianapolis – Electronic systems contractors (ESCs) generated anywhere from $8.3 billion to $8.7 billion in revenues from residential installations in 2011, up about 6 percent from a flat 2010, new Parks Associates research shows.

The research, commissioned by CEDIA, also shows that ESCs expect their residential revenues to rise about 5 percent in 2012.

“2010 was the year of stabilization,” said CEDIA market research manager Erica Shonkwiler during the CEDIA Expo. “2011 started seeing companies do a little bit better.”

When residential installation revenues from security installers, electrical contractors, IT professionals and other companies are added to ESC revenues, the study found that combined residential installation revenues in 2010 were flat in a range of $13 billion to $14 billion and rose in 2011 by about 3.6 percent to 3.8 percent to a range of $13.5 billion to $14.5 billion, the study shows. The combined dealer base expects total residential revenues to grow about 3.9 percent in 2012.

The 2011 through 2012 findings were based on responses from more than 770 installation companies surveyed in June through August 2012 out of an estimated 20,000 to 22,500 installation companies, including 8,300 to 9,300 ESCs. The number of installation companies changed little in 2011 compared to 2010, Shonkwiler said.

The research study also determined that:

-- ESC revenues from installs in existing homes are on the rise. In 2007, the split was about 50/50, but an average 73 percent of ESC’s residential revenues in 2011 came from installs in existing homes. “This is probably the new norm,” said Shonkwiler.

--ESCs expect average revenues per residential project to increase by 18 percent in 2012. The 2011 average of $28,000 will grow to $33,000 in 2012.

-- ESCs expect their average revenues to rise 4.6 percent in 2012 to $1.38 million from 2011’s $1.32 million, including commercial installs. ESCs’ average residential revenues were $942,000 in 2011. IT professionals expect a 5 percent gain in total revenues, while security installation companies expect a 4 percent decline. Electrical contractors expect a 14 percent gain.

  • Installs of outdoor entertainment systems by ESCs are on the rise. Consumers who are staying in their homes are extending their existing home entertainment installs to their back yards, Shonkwiler said. The number of outdoor installs is projected to rise by 49 percent in 2012, with an average project size of about $7,400.
  • Wireless technology is widely used in audio installs. About 39 percent of audio installs incorporate wireless, and 37 percent use a mobile device as the primary control interface.
  • More control systems are using mobile devices. A total of 90 percent of dealers installing a control system are integrating a mobile device, and 33 percent indicate the mobile device is the primary control device.
  • The average number of home-theater and multi-room-audio installs is projected to remain the same in 2012. The average project size in 2011 was about $20,000 for home theaters and $11,000 for multi-room audio.

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