Commentary from Top Technology Integrators
ProSource has been a great partner for Ihiji. We had a great showing and conference in March in Orlando and yet again at the recent dealer conference in San Antonio. The format of the event provided a great opportunity for dealers and manufacturers to come together and discuss their needs and goals for the second half of the year. Ihiji had the opportunity to talk with over 20 of the nation’s top integrators of AV, security and automation solutions in both residential and commercial clients. Whenever we have the opportunity to hear directly from technology dealers as to what their big initiatives will be, we jump at the chance. It is the best way for us to identify trends across the industry which will help to inform our next versions and future products.
Trends from IoT Technology Integrators
Here are a few of the things we heard consistently:
The Network is “Table Stakes”
This is a concept which was mentioned in the initial address by Prosource’s David Workman. For the past 3-5 years, the number of IP-enabled products which have been introduced in the audio-visual, automation and security space has skyrocketed. The good news is that most dealers are at a point of comprehension regarding this new technology where they are able to connect their devices to the network and get them functioning properly. Many have even become pretty good networking technicians, able to identify the issues which arise when connecting their devices to an existing wireless network. This has opened up a great opportunity for dealers to boost revenue and profit margin for each project by installing a new network infrastructure. This also helps to improve the performance and control of the devices being installed. A win-win.
Time and Materials Projects Won’t Sustain My Business
Since the 1970’s, the AV and home entertainment industry has made their business on specifying, designing and installing audio visual components in client homes and businesses. Aside from the additional revenue from extended warranty service contracts, this was the primary revenue opportunity they had. That is, until the client was ready for an upgrade or refresh. Today, there is a very unique opportunity for these same integrators to create additional streams of subscription-based revenue each month. This is also known as recurring monthly revenue (RMR) and it is directly related to these devices being networkable or ip-enabled. This is also known as “The Internet of Things (IoT)”.
I Need a Better Exit Strategy
The times, they are ‘a changin’. Maybe that is good…maybe not so much. The technology of IP-enabled devices is a new concept which is being introduced to products of every kind from light bulbs to LCD TVs. As a business owner, shifting your entire business process to get a better handle on this new technology is a daunting task and some dealers would rather just find a suitor and exit the business. One of the best ways to maximize a buyout value is to prove that you have a sustainable, repeatable and growing revenue stream. In a time and materials based business, the only way to accomplish this is to simply sell more projects or increase the price of each project you install. Rather than working a lot harder, most dealers are opting instead to explore a recurring revenue model. This is a subscription based service to monitor and proactively manage your clients’ networks and devices. This is also a service which can be sold to most existing and new clients you get. Imagine what your company would be valued at if you could point to a monthly stream of revenue coming from all of your clients? It would be a lot bigger than simply waiting for a client to upgrade their gear, that much is for sure.
If you are struggling with these challenges as well, Ihiji can help.
By connecting Ihiji to every network and every device, you will immediately have in place a recurring revenue stream for a service which customers really need.
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