CEDIA: Installer Revenues Up In '10 - ResidentialSystems.com

CEDIA: Installer Revenues Up In '10

  Electronic systems contractors (ESCs) who are CEDIA members enjoyed 13 percent revenue growth and rising profit margins in 2010 despite the depressed market for new home construction, CEDIA's annual benchmarking survey  found. The responding companies also
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 Electronic systems contractors (ESCs) who are CEDIA members enjoyed 13 percent revenue growth and rising profit margins in 2010 despite the depressed market for new home construction, CEDIA's annual benchmarking survey found.

The responding companies also expect their revenues to grow in 2011.

Average revenues for a responding company hit $1.32 million in 2010, up 13 percent, with installers expecting 2011 gross revenues to increase on average by 15 percent to $1.52 million. In 2010, most of the ESC's revenues again came from retrofit and remodeling installs, both of which accounted for an average of 63 percent of gross revenue in 2010.

Average net profit margin rose to 4.1 percent in 2010 from 3.5 percent in 2009, though the average margin is still below 2007's 6.8 percent.

For 2011, the respondents expect the number of jobs they do to increase from 2010, when the median number of projects for ESC companies was 41, and they expect that number to grow to a median 51 in 2011. The average 2010 project size was $32,000.

A stepped-up marketing effort was the reason cited most often by installers for their expectations of rising sales and profits in 2011. After the end of the first quarter of 2011, 93 percent of respondents indicated that they expect to be profitable at the end of 2011.

Among project types, home theater/media room installs accounted for a smaller share of respondents' gross revenues, falling to 17 percent in 2010 from the previous year's 24 percent, presumably because installers have been diversifying into lighting, security, energy management, and systems integration. In fact, respondents called "systems integration/control" their most profitable product category in 2010, CEDIA said.



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