2010 State of the Industry Report

The industry is still ticking after taking a licking in 2009.

Jason Knott · January 4, 2010

There’s no way to sugarcoat it: 2009 was a very difficult year. According to the 2009 CE Pro Reader Survey, the average CE pro integration company saw its gross revenue from residential installations fall a jaw-dropping 51 percent in 2009.

The substantial drop — from a median of $1.09 million in 2008 to $531,250 in 2009 — is more a reflection of the state of the U.S. economy than the custom installation industry. The average number of installations also fell precipitously, from 134 to 78 jobs.

Despite the mind-numbing 2009 data, there are some positives. First, the average end-user price for an installation increased by 26 percent to $19,000 compared to $15,000 in 2008. Also, integrators anticipate doing 90 installations this year, 15 percent more than in 2009.

Most importantly, CE pros are optimistic for 2010. Nearly half (48 percent) expect higher revenues and another third (34 percent) anticipate flat revenues this year. Indeed, dealers are expecting revenues to increase an average of 8.5 percent in 2010.

Moreover, the staggering economic climate appears finally to have been an impetus in getting integrators to move outside of just the world of audio and video. Market areas such as alternative energy, digital signage, large display commercial video and fiber optics are now much more commonplace among dealers.

Analyzing the Trends

The 2009 CE Pro Reader Study represents a broad sample of the readership. We received 622 viable responses, representing a statistically significant portion of the industry. The data is sifted to represent only installing integration companies, excluding suppliers and distributors. All responses are strictly anonymous. The data is only presented in aggregate to ensure confidentiality of respondents.

For 2009, the data reflects a substantial growth in the number of very small companies … those earning less than $250,000 in gross revenues. In 2008, only about one-in-five companies (22 percent) earned less than a quarter million. In 2009, one out of every three companies makes under $250K. This trend could be caused by two issues. First, a certain percentage of mid-sized integrators have lower revenues. Also, due to layoffs in the industry, there are likely a slew of new mom-and-pop integrators in the field who were formerly technicians for other companies. When those positions were downsized, many formed their own firms.

On the other end of the financial spectrum, the number of very large integration companies earning over $5 million fell to just 6 percent of the industry (compared to 25 percent last year). This data mirrors the information collected early in 2009 as part of the CE Pro 100 list, which showed an average drop of 12 percent in revenue.

  About the Author

Jason Knott is Chief Content Officer for Emerald Expositions Connected Brands. Jason has covered low-voltage electronics as an editor since 1990, serving as editor and publisher of Security Sales & Integration. He joined CE Pro in 2000 and serves as Editor-in-Chief of that brand. He served as chairman of the Security Industry Association’s Education Committee from 2000-2004 and sat on the board of that association from 1998-2002. He is also a former board member of the Alarm Industry Research and Educational Foundation. He has been a member of the CEDIA Business Working Group since 2010. Jason graduated from the University of Southern California. Have a suggestion or a topic you want to read more about? Email Jason at

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