Survivors of the Shakeup

Today’s pro AV market promises continued challenges — and a few positives — for those who survived the economic fallout from the collapse of the tech sector.

By Tim Cape, CTS-D

There was a time in the 1990s when AV employers had a hard time finding good AV people. Everyone in the industry had a job and everyone was busy, but not everyone knew what they were doing. But hey, there was lots of work to be done.

That scenario has changed for many. Now we hear about layoffs at pro AV firms both large and small. And some of the large integrators that got fat during the ’90s boon are either struggling or in bankruptcy. Manufacturers are feeling the pain, too.

To be honest, I’ve been secretly hoping for a recession for years. All the crazy growth in the ’90s meant that anyone who wanted to work in the pro AV industry could do so, regardless of his or her experience. With a little initiative, some electronic experience, and a heartbeat, just about anyone who walked into a pro AV shop got a job. During the high times, the dealers, integrators, and consultants needed warm bodies to do the work. Unfortunately, not all of the new applicants had the right education and experience, and amidst the craziness there often wasn’t time for proper training.

The manufacturers and industry associations desperately tried to fill the education void, and to some extent they did. But there were just too many students and not enough teachers or time. This led to a lot of less-than-high-quality installations and a lot of unhappy end-users — and ultimately unhappy consultants and integrators. As a result, a lot more people now understand the difference between good AV and bad AV.

Times are different now. Everything changed around 2000. The tech market dropped, the mainstream market dropped, and corporate work dried up. Many of the AV companies that had been riding the ’90s wave suddenly weren’t riding anymore and there were lots of layoffs. Integrators, rental houses, and box dealers in particular were left looking around the office to see who they could let go to avoid missing payroll. This wasn’t happening to everyone, as I noted in the April issue of Pro AV ("Analyzing the industry with new math," page 30), but it was a common experience for many of us.

Post-Purge

So what does this new landscape mean to those of us who survived? Like a hostile corporate takeover, it means different things to different people. Let’s analyze the impact for some of our industry’s key professionals.

Integrators

For a lot of people who provide bid-build or design-build services, the current economy means it’s time to look for a new job. The drop in midsize corporate projects and other short-term design-build projects means it’s harder to feed the masses, so the masses have to become less massive. Plus, there are more competitors to deal with since there’s not as much work. And because there’s more competition, there’s less revenue to go around, and less revenue generally means lower profits.

The good part of this is that pro AV companies will keep their most experienced people and become leaner and smarter as they fight to stay in business. And that means better workmanship. For those companies looking for more people, there are a lot more qualified applicants than there once was.

Consultants

Those of us who consult for a living without selling boxes are getting a lot of calls from people who do, many of whom haven’t been regulars on our phone message lists. For a long time we could expect three or four bidders on projects, but now we may get 10 or 20, making it tougher for the consultants and bidders alike. Adding to the problem is the fact that some of the most qualified bidders who are still relatively busy won’t come to the table with such a long bidder’s list.

But there are also positives. One advantage for consultants is that we’re getting to know more integrators, which gives us more choice when it comes to getting systems installed. Another good thing is that we’re finding it a bit easier to convince system owners to change outdated bidding procedures to help the bidding process match the projects. And like busy integrators, busy consultants are finding more qualified resumes in their inboxes.

Owners and end-users

The system owners are getting a lot more calls, too, and that means more choices for pro AV services than they had before. This can threaten some established owner provider relationships.

Some owners are experiencing poorer service from integrators and consultants who have had to let people go. This may require a little more diligence on the owner’s part to monitor ongoing system installations.

On the other hand, the owners can benefit by lower bid numbers due to increased competition. I often see new projects bidding at ranges below system budget estimates due to lower margins on equipment.

No matter what your job title, chances are you’ve had to change the way you do business over the last three years — regardless of what your qualifications and talent should dictate. If you didn’t adapt, you’re probably working in another industry and aren’t around to read this anyway. But if you were able to weather the storm, keep in mind that the change has meant something different to everyone.

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