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Return Of Residential-Install Growth Seen

DALLAS — Three-fourths of surveyed
systems integrators expect their residential-
install revenues to grow this
year, up from only a third who said their
businesses grew in 2009, according to a
fourth-quarter survey by Parks Associates
and the Custom Electronic Design
& Installation Association (CEDIA).

The survey polled installation companies
that install home controls, entertainment
systems and energy-management
solutions, including multi-room
audio, home theater, low-voltage wiring,
and security and control systems.
The installers’ forecasts exclude commercial-
venue installations.

In a separate study, Parks forecasts
integrators’ residential-install revenues
will rise 6.6 percent in 2010 to $8.9 billion,
reversing two consecutive years of declines.
In 2009, revenues fell 4.6 percent,
preceded by a 6.5 percent drop in 2008.
The two-year drop followed 2007’s single-
digit percentage gain of 8.8, which
followed years of double-digit gains.
The industry estimates reflect installer-
level revenues, including hardware
sales and labor charges.

The upturn in installer sentiment and
forecast channel revenues tracks a January
2010 forecast by the National Association
of Home Builders (NAHB), which projected
that single-family housing starts would
increase 35 percent in 2010 following four
years of double-digit percentage declines.
The housing-start declines peaked in 2008
with a whopping 40.5 percent drop, Census
Bureau statistics show.

In releasing details of the installer survey,
Parks said 54 percent of surveyed integrators
reported 2009 revenue declines, with
reported declines averaging 4.1 percent.
Another 13 percent said their revenues remained
the same in 2009 and 33 percent reported
revenues increased in 2009.

Among the third of polled installers
whose sales grew in 2009, many had
diversified to focus more on retrofit
and upgrade opportunities, the survey
found. In fact, retrofit projects accounted
for an average 63 percent of installers’
2009 revenues. Other installers who
grew in 2009 hired more sales staff and
enhanced their customer support.

Installers also plan to diversify their
product offerings. Although integrators
continue to generate two-thirds of their
revenue from A/V systems, the survey
found, many plan to diversify in 2010 by offering
lighting controls and solar panels
for the fi rst time. About 40 percent of integrators
plan to begin installing photovoltaic
solar panels, and another 38 percent
are investigating the market to determine
if they should do so, the survey found.