A few months ago, CustomRetailer posed the question to its readers, “Are You Commercial?” Most of us understand that a current business opportunity is commercial design and systems integration. Manufacturers are talking about it, reps are talking about it, and the press is talking about it.
The commercial business is very different than the residential business. What are the key differences? Here are just a few: The products you sell; the systems designers; how the products are connected; reliability (although consumers want reliability, they usually have more than one display. In a commercial installation, duplication of environments is not as typical. The equipment has to work); a good working knowledge of commercial and building codes in a given area; how you are paid; profit margins; etc.
All of these require a different knowledge-base and expertise in areas not normally performed by the traditional custom retailer. The following survey was designed to find out how many of the current custom retailers/integrators are doing commercial business and the performance results from the commercial area.
1) Are you currently doing custom installation?
90% of you answered yes.
2) What percentage of your business is commercial?
45% of you said that less than 20% of your business was commercial. 21% to 39% of you said that 21% of your business was commercial. 8% of you said that 80% of your business or more is currently commercial.
3) Are your profit margins with commercial installations (including products and labor) higher or lower?
39% of you said higher, 31% of you said lower, and 30% of you said the same.
4) Do you have a separate installation team for commercial installs?
11% of you said you do, and 89% of you said you don’t.
5) What type of commercial installations do you perform?
86% said restaurants and bars, 75% said medical offices, 36% said hotels, 45% said schools, 50% said religious institutions, 78% said corporate boardrooms, and 13% said stadiums.
6) Do you offer 24-hour, 7-day service for your customers?
31% said yes, 69% said no.
7) What is year-labor warranty for commercial installations?
12% of you are 90 day, 10% of you are 6 months, 68% of you are 1 year and 4% of you are greater than 2 years.
8) Are commercial installations growing at a faster rate than your residential business?
40% of you said yes, and 60% of you said no.
9) Do you sell security with your commercial installations?
34% of you said yes, and 66% said no.