I think they will have better luck pushing Lorex than Dahua. Dahua seems so disorganized. For Dahua’s sake I hope the stay out of day to day managment of lorex and just give them money to fuel the company. It’ll be interesting to see what happens next. We don’t buy either product line currently. 

Acquire a competent / experienced management team

This, as long as they can keep their executives from meddling and replacing with their own staff.

Costco will be SOOO happy that they can now sell Lorex for even less  .....

Not clear why the existing Lorex management (who may well be awesome at selling to Costco) would have any value when mapped into the enterprise world.

FLIR seems wise to offload to Dahua in my view. At ANY price.
I think the transaction is worth meaningful contemplation by every installer/integrator in this industry. Every surveillance kit Lorex sold was a slap to every installers face. It seems most ignore the erosion these retail kits cause, but it's a factor. Small business represents an enormous share of overall cctv market sales. These retail kits are quite popular in liquor stores, mom and pop gas stations, retailers, bar/restaurants. This purchase by Dahua is in my view, "the canary in the coal mine". The message is clear , Dahua was already essentially a "direct" to consumer company given the public pricing model chaos, and most notably, Amazon pricing for every end user to use as leverage against any installer attempting to win bids. That challenge just became more severe.

Dahua has eliminated an additional cost layer by eliminating the middle man (Lorex).
Immediately, Dahua has the ability to reduce USA pricing and aggressively take share from other direct to retail competitors. Problem is, this will logically result in simply more obstacles for the installer market. More margin compression, and less total available business for installers.

The logical strategy for installation companies in my view is protest by only means available. Simply refuse to install Dahua product. Let them have retail, but dont fuel your own demise by financing Dahuas "margin" business and install what Dahua labels for obvious reasons, their "professional" products. Its the same equipment, simply labeling one as consumer, one as professional is a bit insulting to those with knowledge.

FLIR off loading at what appears to be a fire sale valuation...............
AS INSIDERS, we all know that a Ring, Blink, etc. product is about as basic and simple as a video product can possibly be. Yet, what is extraordinary is pricing. A Ring floodlight camera yields $200.00 and recent venture capital inflows into Ring establishes their company at a present 1 Billion USD valuation. CNBC.com for reference.

Search online for 2 minutes, you'll easily find a 4CH NVR, with 4 HD IP cameras, with an installed 1TB Hard Drive for same retail price as one Ring camera. That's incredible. For that matter, a complex, full featured 4MP IP camera, with smart features like missing object, trip wire, people counting, etc. Search a few minutes, direct retail pricing, and a typical Omni-Vision image sensor, with the latest Hisilicon DSP is only yielding 60.00 to 80 dollars. 1080P Ring or Blink? With only a sort of , kind of, maybe motion detection function yields a 300% premium retail pricing. Likely, a fraction of the support overhead of A complex NVR system. More profound is the public feedback of these simplistic products. They genuinely yield near 100% customer satisfaction ratings. These products are not just for homes. MANY small and micro businesses are electing a Ring or Blink product over traditional complex CCTV products. 

When the dust settles, I strongly believe Lorex post Dahua acquisition ends with a total loss for Dahua. Ring and others like them will continue aggressively taking market share from traditional CCTV, Dahua will be harnessed with infrastructure and other legacy Lorex overhead resulting in negative cash flow at some point. Margins are already in a very "dangerous" range. 

FLIR has a market cap as of today, 1 PM of 6.6 Billion USD. Obviously they could care less about 29 million dollars Dahua paid them for Lorex. One can safely assume a multi-billion dollar entity has PHD staff to look through a prism of what the "future" potential truly is. Accepting a seemingly ridiculous .2X sales to dump this entity could ultimately end up as the deal of the century for FLIR. FLIR left for a reason.

The question is in my view...............
Will our industry continue installing Dahua given the obvious direct competition Dahua admits by making this acquisition? Dahua is the competition now, NOT a partner.

The end of dahua

As someone that sells primarily Dahua, I find the move disappointing. I agree in the fact that they are now a direct competitor.

Its strange that in the press release that they don't mention that Dahua purchased it?

Perhaps they aren’t happy about taking it on either and just pushed into it

didn't want to lose the sales channel

The fact that Dahua has been selling direct to end users either directly or indirectly has been known for a few years now. Most competent resellers/distributors knew this as well. It was clear that their game plan was to achieve direct to end user sales. Honestly, I am not concerned given their organizational issues. It takes alot to sell to end users and I don't think this is really a specialty of any Chinese Manufacturer so I say let them try their experiments early so they can understand that this isn't their wheelhouse. Honestly, I think they will fail miserably and perhaps dissolve lorex or sell it off. Dahua the company will continue on though.

I also truely believe that this will have very little impact on Dahua's USA sales to integrators. I seriously don't think the average Dahua installer will care. You can call it sad, mad, crazy that anyone would continue to buy Dahua but thats just the how the market will react. The only way they will care is if it starts affecting their ability to sell the product and it wont because:
#1) Most end users wont know the relationship between Lorex and Dahua
#2) Customers who want their products installed are not interested in DIY systems. DIY systems have been around for years and integrators still conduct business as usual. 

To give you an example. Whenever we sold Dahua, Dahua listings on Amazon were rampant, yet we weren't that affected.

If Dahua gets into the integration business, thats another story, their sales to integrators are gone.

The only reason why I still have some Dahua hanging around here is purely to still screw around with some real HW in the lab, I would never ever introduce that into any production environment, and if the only choice I would have been between Dahua and Hikvision, I would choose Hikvision. 

Sad, but true.

Some comments:

-DIY is here to stay.  Just added some "Dots' to several rooms in my house and now Alexa has become my home intercom system. Will probably add a video door station with an IoS and Android app...more features than a Ring system.

-Selling direct is not just for the low cost manufactures.  How many stories have we heard about high end camera manufacturers selling direct to casinos? 

-I think we are in the middle of a paradigm shift,  and, as usual, the integrator who best serves the middle and high end customers will survive and prosper, and the low end products will continue to not be a significant worry. 

-The lowest common denominator keeps pushing upward, and our job is to stay higher in the food chain, IMHO

So going forward, FLIR will not be selling any ultra low-cost kits under any brand, or?

The difficulty for customers as I see it 

is lack of credible alternatives 

manufactures struggling for growth so selling out

all well and good saying dahua buying Lorex puts pressure on installers but where’s the serious alternative 

hik 

hik already over saturated 

installers I speak to here like buying ice cream for the first team they fit hik

so excited to put it in and think their customer loyal and locked in 

then a year or so later their super locked in partner bought hik elsewhere and the only company locked into the end user is hik

not sure uniview any better

then there’s a leap from here to high end 

where price don’t matter

aviglon here prices are eye watering expensive

axis milestone Genetec sit way above China products

so for the main installs China only solution I don’t think installers are Nieve 

that they are digging their own graves

they just don’t have a choice

so as much as Costco knock out Lorex dahua below dahua own brand pricing 

or hik sell hiwatch below hik brand pricing

customers have to eat 

As an industry, I think we need to keep an eye out for these types of transactions, if only out of curiosity. But, as an integrator, if this deal in any way affects your operations, you likely are playing to very small install markets. I can’t imagine how this deal affects a great majority of integrators or their distributors.

Oh, and Dahua will find a way to muck it up. They are relentless. 

Dahua has simply purchased the former DigiMerge business segment known as SMB from FLIR. Some of the SMB products where being manufactured by Dahua. This will become a TBD branded division of Dahua. The low end kits are made by yet another vendor and will continue to be provided as such, 4K included. The current FLIR SMB brand name will be gone soon.

As for Lorex, I'd be surprised if Dahua puts their name on it. That would indeed dilute the attempt for Dahua to be recognized as a "pro" channel video supplier.   

we had an international customer who use to use us and stayed with dahua 

as we use to oem from them

he has come back to us crying his local sandwich shop now distribuotrs

dahua

The consumer market is huge as the Arlo article shows us. But the consumer market is also brand driven and building a consumer brand is expensive, challenging, and takes a lot of time unless you own some new breakthrough technology. Even though Lorex may not be a household name it is miles ahead of Dahua in terms of brand recognition at the consumer level. Also, managing the retail channel is very tricky and requires a much different approach and management skill set than what's typical for professional market channels. There are different rules to play by. Relationships in the retail channel are also extremely important and take time to develop. So Dahua picks up an experienced retail management and sales team with the acquisition and this also has a lot of value. And by having a brand segmented from their professional line they also can reduce channel conflicts and bad blood in the professional market. $29 million is not so much for a company the size of Dahua so I think it is a pretty good move. But also one which Dahua could easily screw up which would not surprise anyone familiar with how they operate.

My only concern is whether Dahua's name or logo will appear anywhere on Lorex products and when. This is crucial to how we move forward.

As a competitor it’s our mission to notify as many customers as possible

we also include links to maplins UK website 

where you can buy dahua cheaper at retail prices than trade