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CEDIA Survey: Residential Installers’ Revenues Surge

Denver — Custom integrators are seeing residential install revenues rise at a faster pace in 2014 than 2013 because their projects are growing in number and scope, CEDIA announced in revealing preliminary results of an installer survey.

The fourth annual survey of installation companies also found that new homes are accounting for a growing share of revenues as the new-home market turns around, and a growing percentage of multiroom-audio installs incorporate wireless Sonos-like speakers.

A total of 732 companies responded to CEDIA’s survey, up 25 percent from the 2013 survey. The latest survey was conducted in June through August and announced here at the CEDIA Expo.

Installers forecast their 2014 residential revenues will rise on average by 20 percent in 2014 to $1.75 million compared to 2013 growth of 15 percent. The totals include equipment, labor and service. Median revenues are expected to be about 63 percent less than the average based on past surveys, or about $646,000, CEDIA said.

Installers forecast that their average number of residential projects will rise 14 percent in 2014 to 58 projects, compared with a 2013 gain of 13 percent to 51 projects. The median number of projects typically comes in at 43 percent less, so the median number of projects will likely turn out to be 33, up from 2013’s 29.

The percent of residential revenues coming from new home projects is forecast to rise to an average 36 percent in 2014, up from 34 percent in 2013, 31 percent in 2012, and 30 percent in 2011. Revenues from existing-home projects will slip to 58 percent in 2014 from 2013’s 61 percent and 2012’s 65 percent. Revenues from MDU installs will remain at 6 percent in 2014.

 The survey also found that the percent of revenue from equipment has remained stable despite concerns over product commoditization, CEDIA said. Equipment’s share of revenue is forecast to hit an average 54 percent in 2014, up from 53 percent in 2013 and 50 percent in 2011. The majority of businesses, or 56 percent, said the rise of cloud-based content services has not reduced their hardware revenues.

Among their multiroom-audio installs, installers on average expect 26 percent will include Sonos-like wireless speakers, up from 21 percent in 2013 and 16 percent in 2012.

More installers (38 percent) agree rather than disagree (17 percent) that wireless speakers help their business because many consumers aren’t comfortable installing them. The rest were unsure. Nonetheless, 40 percent of installers don’t believe they can sell more wireless-speaker products to make up for lower equipment margins, while only 16 percent thought they could.

In other findings:

*Installers expect 25 percent of their flat-panel TVs sold on average in 2014 and 2015 to be 4K TVs.

*Installers forecast 29 percent of their 4K TV sales in 2014 will include a 4K player or server.

*Installers sold 56 percent of the flat-panel TVs used in their flat-panel installs, while 22 percent of jobs used a client’s existing TV and another 22 percent used a TV purchased separately by the client.

*For the projects using a client-purchased TV, an average of 72 percent of installers suggested a brand, and 59 percent suggested minimum specifications, to drive the purchasing decision.

*Seventy-three percent of an installer’s revenues on average came from residential projects compared to 74 percent in 2013 and 72 percent in 2011.