Distributor's #1 Challenge

Author: Brian Karas, Published on Jan 04, 2017

Manufacturers and integrators are not the only ones challenged in the security market, distributors are also impacted, fighting to maintain margins and profit.

For this report we analyzed responses from dozens of distributors revealing their #1 challenge on margins, provide commentary from distributors on what is impacting their margins, and how the industry is responding to distributor's attempts to fight the race to the bottom.

************* *** *********** *** *** *** **** **** ********** ** *** security ******, ************ *** **** ********, ******** ** ******** ******* *** ******.

*** **** ****** ** ******** ********* **** ****** ** ************ ********* ***** #1 ********* ** *******, ******* ********** **** ************ ** **** ** impacting ***** *******, *** *** *** ******** ** ********** ** distributor's ******** ** ***** *** **** ** *** ******.

[***************]

#1 ********* - *** **** ******** / ********* ******

**% ** ************ ********** ** *** ****** **** **** ******* have ******** ** *** **** ****:

** *** **** ******* ** ********** ******* ********* ******* ** **** asked "**** *** *** **** ****** *** *** ********* ******* *** dealers / ************? ***?", **** ****** **** ************ ******** ******* *********, ***** *** ****** ********* agreement **** ***-**** ******* ******** *** ********* ************ .

Increasing ******* ************

*** ***** ****** ************ *** ******** ********* ******* ** **** a **** ********** *******, *** **** *** ********* *** ****. No ******** ** **** ******** *** * ****** ******** *******, and **** ***** **** **** ****** ***** ******* **** *********, ******* were challenges ** *** **** ********:

  • "******* *** *********, *** ****** *** **** ** ******* *** to *** ********* ***** *****. **** *** ****** **** ****** in ******* *******, ** ********* ***** ** **** *********. *** type ** *** ****** ** ******** **** *** **** ** Retail ** **** *********** (******** ********), ********* * ********* ******* mix."
  • "***** ****** ***** ****** **** ** ****** ************ ** ********** technology *** ******** *** ***** ***** *****. ****, **** ************* are **************** ***** ******** ** ***** ** *********** ***** ***** numbers **** ********* ******** ***** **** ************ ** **** ** real ******."
  • "******* *** ******* *************"
  • "************ **** ** **** *********** ********* ** *** ** **** quality **** *****."

Distributors **** ****** / **** *** ********* *******

************ *** ** ****** ** ** *** ****-**-***-****** ** ************* and ***********, *** ***** ************* *** *********** *** **** ******* (at ***** *************) ** ****** **** *******, ******* ********, *** service, ************ ****** **** ***** ** ***** ******* *********** **** to *** ********. **** ****** ******** **** ** *******, ************ lose ******, ******, ** **** ** * ****** ** ****** competitive *******. **** *** ************ ******** ** ******* **** ************ that ******** ******* ** ********* *******:

  • "*** **** ******* **** ** *** ****** ***** ** ** in **** ***** **** ** *********. **** ********* **** ***, Dahua, ******* ***. *** ****** *********** ***** ******** ** *** customer *****, ** **** ** ****** *** ** ****** **** lead *** **** **** ** *** *******. ** **** ** manufacturers *** *********** ******* ** *********** *** ***** ****** ******** to *** ******* **** **** ***** **** ********. ************* ****** remain ****** *** *********** *** ***** *** *********** ** *** pricing **** ****** *** * ****** *** ***** ******* *** more ********* ********* ********* **** *** ** ****** *******."
  • "*** ******* *********** ******** *********** **** *** ** ***** ****, which ****** **** ****** *** *** ****. ******* ** *** HIK ** ******* ******** ** ***** *************."
  • "*** **** **** ********* *** ***** **** ******** ******, ***** Chinese ******* **** ******** *** ****** **** **** **** ***** prices."
  • "******* *************"
  • "**** ***** *** ******* ******. ******* ******* ******* *** ********* on ******* *** **. ******* ********* *** ******** *** ******** risks **** **** *******."
  • "****** ******* *** ******* ***********"
  • "*** **** ****** ** ***** ******* *************** ** *** *******. The ******* ** *** ******* ******* ** **** *** *** value *** ***** *********. ********* *** *** ****** ** *** and **** * ***** *** ** *** **** ***** **** to ******* **** ** *****."
  • "**** ** *** ******. ******* ************* ********** ** ***** *** American ****** *** ****** *** *********** ***** ** ************ - distributor - ********* - *** ****. ************* **** ** ********* the ************ *** ********** ********** *** **** **** ***** ******** so ***** ** ******, ****, ****** ******, *** **** **'* almost ********** ** *******."
  • "** ********* **********, *** **** ** *** ****** *** * huge ******. ****, *** ***** ******** ** ***** **** ** lower ****** ** **** **** ******** **** **. ************, ** prices ******** ** ****, ***** ******* **** *** ********* *************. This ******** **** ********* **** **** ******* ********** ***** ***** gross ****** ******* *******."
  • "*** **** ** *** **** *********** **** *****."
  • "********* ** *** **** *****. **** **** ** ***-** * benchmark *** *** ****** (***** ******** ********** **** ********). ***** we ***'* ***** ****, *** ***** ****** ** **** ** miss. *** *** **** ********* **********, *****, **** ***** ** the ********* ** "****" ****** ***** *** *********** *** **** products *** ********* **** ****** ******* **** ** *** ***** them ** ***********. **** ** ******** *** *** ******, *** not **** ******. ***** ******* ** ****** ******** ***** ******* discounts (******* ** **) *** ******* *** ***** ****** ** imported ******** *** ******* **** ******** ******** ******* ****** ** to **** ******* ****"
  • "******* ******** * *********. ***** ***** *** **** ***********."
  • "****** * ***'* ***** **** ** ** ******** *** ******* profits **** ** ****. **** **** ** *** ****** ** cameras **** **** ******** ** **** **** ******* *** **** sell **** ******* **** **** ****. **** ******* **** **** in *******, ******** **** *** ***** ***** ********** ******** ******* margin *** ******." 

Solution ***** - ******** *** ********

** ******** ** ****** **********,************ **** ***** ** ***** ** ******** *****. ******* ** *** **** **** **** ***** *** ***** and ************* ******* **** ****, *********** (*** ***********'* ****** ********) are ********* ******* ** ************ ****** ** ******** *********.

************* ********** **** **** ** *******, **** ***** ****** ******* on ******* ***** ******** ****** ******* ****. *********** ** *** want ** ******* ** ***** *****, ******** ********* ** ********** solutions ** ******** ** ** ***** *** *****, **** ************ offering ********* *** ****** ** ** **** **** ** ***********, or ** *** **** *****, *********** ** *** **********'* ***** proposition ** *** ********.

*** *********** *** ****-********, ****** **** ** *** ** ********* to ******** *** ********* ** ****** ****** *********:

*************** ** ******** - ******** ***** ** ** ****** ******. **** knowledge ******* ** **** *************** / ******** ****** **** **** eager ************.

Market ********** *** ************

**** ** * *********** **** *** ******** ************, *** ******* announcements *** *********** **** **** *******, ** ************ ********* *** not **** ** * ** * '***' ******** ** ***** their ********. ***** *** ** ***** ** *** **** ** the ****** *******, *** **** ** * **** ****** ** hit ** ** ******** ****** ***** ***** **** *** ***** ************ ** return ** ******** ****** ** *************.

******** *******, **** ** ******** ** ***********, *** ** **** consuming, *********** ********** *** ********* ** ****** ** ******. **** approach also ******* * ****** ***** ** ****, *** **** *** distributors *** *** **********, ** *** '********' **** *** **** as ********.

************ **** **** ****** ** ****** ** ******* ** ***** areas ** **** **********: ***** ** ******, ***-**** ********, *** large *********** ** ******* ********* *** ********* ********. ********** *** still ** ******** ** ***** *****, **** ** ******** ***** ******* ********, ** * ********** ***.

Comments (7)

* **** *** **** ******** ***** ****** ********** ** ***** slammers, *** ******** **** ***** **** ****** ****** **** *** integrators ** *** ****** *** *********** ******* ** *** *******.

** ***** ** **? *** **** **** **** ******, ***** labor ****** ** *** *****?

**, ***** ******** ****** *********** ***********, *** *** ******* ** site, **** *** ***** ** ****** *** ***********. ****, ** are *** **** *** **** ** ******* ** **** ****.

** *** **** ***** ** **** ********, "** **** **** you ** **** *** ******, ** ***** **** ***** ** let *** **** *** **** ** *** *********."

***, *'** **** **** **** *** ************ **** ******. ** short, * ***** ************* ***** ****** **** *** ********** ** the ****** ****, ******** *** ****** *** ***:

  1. *** ********** **** ** **** ** *** ************* ******* ** possible (******** *** ******* ******** **** ** **** *****)
  2. *** ********** ****** * "******" ****** (*****, **** *** ************* perspective) *** ********** ***** ** ********

*** ************ ***** ****** **** *** *** ******** ** *** their *******, *** *** ** ****** ** **** ** **** product ** ******** ** **** ** ** ** *** ****** yourself, ** ** ***** ********* *** *** **** ******* ** request **** ********.

***, ************ ***** ****** ***'* ** ***** ******, ** *** next **** ***** ** ** ********* *** *********** ** *** your ********. ******* ***** ***** ** ** ****, ***** ******, spending ********* ***** **** *** ***********, ***.

**********, * **** **** * *** ** ***** *********** **** up **** **** ***** ***-**** ********* ** ******* ******** ********. The **** **** ** ** ******* **** **** *****, *** sales **** ** ** ****** **** ** ***** *** **** problem **** **** ** ** ******* ******* ** ** *********** option. :)

****, ** *** *** **** *** **** ** ******* ** long ****.

**** ** * *********** ************* *********. **** *********** **** *** the ****** *** ******* ******** ******* ** ******, ****** **** try ** ***** ********** (********* ***** *** ********) ** *** manufacturer.

*** *** ************ ***** ******, **** ****** *** ** ******* about *** ******* **** ****'* ****, *** *** ******* ****** that **** **. **** ***** **** ****** ********, *** ***** them ** ******* *********** ** ******* *** *** *********, *** they **** ** ** **** ** *** ****** **** ** ensure **** ****** ***** ** ******** *** ***** ******** ***'* take *** ***** *** ***** *********** ***********.

**, **, ****** **** ***** ***** **** *******. *** **** wire ******* **** ********* ******, ******* ******* *** ******-****** *********.

*** ** ******* ***** ***** ****** ** ****** ******?

******** ************ **** *** ****** **** *** **** **** ****** a ****** **********.

*** ***** ******** ************ (***, ***-**) *** ****** ** * Radio ***** **** ******** ** *** ******** (***** *****, ******** accessibility *** ********, *** ****** *****). **** **** * ***** portion ** ***** ******* ** **** *** ******* *** ***** end ** *** ******* ****** **** ********* *** *** ***** prices ** **** ******* *****.

*** *** ******* ************ ** *******, **** **** ** **** better ****** *** ****** **** ********/********* ** *** **** ******* with ************'*. **** **** ***** ** **** ** ******* ** margin **** ********* **** *** ******* ******* ******** **** *** big *** ***** ( * ******* ***** **** *** ************'* in **** **** ** ***** **** *******/***-** **** ***** ** not * **** ******** **** *** ********). ***** **** *** would ** *** ***** ********** ********** **** * *** ************* and ****** **** **** ***** **** *** ********** ** **** organizations **** ******** **** ***** **** **** *********** ***/** ***** protection.

** **** *** ** **** *** ***/***-** **** **** **** be ********* ** ** **** ** ****** ** ****.

#*, **** ********. ** *** *** *** ******, ** **********, most ** *** *********** ** *** ******, **** **** ************, fall ** *** ******* *********** ******.

* ***'* ******* ***** ** **** ** **** *** **** I ** ****** ** ******* ** ******* *** **** **** the *****, *** ** ********* *** * ******** ****** ***** (most *****) **** * ********** *********** ****** ***** ************ *** a *** *******.

**** ** *** ****** ** ******** ****** ***** ** **** that ***** ******* **** ***** ******** ***********.

**** ******* *********** ********* ******* *** **** ** *** ***** projects. **** *********** ******* *** ** **** **** ***'* *****, in *** ******** ** *** *******.

******* ************* ******** *** ***** ***** *******.

**** **** ******** ** ************* ******.

** ***'* ****** ******** ******* ***** ** ******** **** *** job.

************ *** *** *********, *********** *** *** ****** ****** ****, installing **** *** ********** ****. ************ *** *** ******** ****** up *** ******/******* ****.

**'* ******. ******* ****** * ******** ***** ********** *** ***** of ***** ******** *********, ******* ******* ***** ** * ****** proposition. **** ** ***** ***, ******* ***** ** * ***** business *******, ***** ******** ******* ** *****.

*** ****** **** *** ************ *** ***** *** *** *** things ****.

Login to read this IPVM report.
Why do I need to log in?
IPVM conducts unique testing and research funded by member's payments enabling us to offer the most independent, accurate and in-depth information.

Related Reports

FLIR Restructures Security Division on Aug 22, 2017
FLIR's goal was once to have a single end-to-end security solution. However, FLIR's Security business unit has been struggling, with several areas...
Top Used License Plate Capture Cameras on Aug 21, 2017
Capturing license plates is a common video surveillance application. But what cameras do integrators mostly commonly used? Special purpose LPC...
Cat 5e vs Cat 6 vs Cat 6a Network Cable Usage Statistics on Aug 16, 2017
Cat 5e? Cat 6? Cat 6a? What do integrators use in practice, today? 140+ integrators told IPVM. Here are the results: For those who want to...
Stolen Video NVR / DVR Statistics on Aug 15, 2017
"But what happens if someone steals my recorder?" Anyone who has done more than a handful of jobs has probably heard this question several times....
Hikvision Europe Cutting Out Unauthorized End User Sales on Aug 15, 2017
The days of anyone buying Hikvision from anywhere off the Internet are numbered, at least in Europe, if Hikvision's plan comes to fruition. In...
Rebooting IP Camera Statistics And Practices on Aug 10, 2017
Dahua cameras automatically reboot weekly, by default. Is this an innovation by the Chinese mega-manufacturer or a sign of a problems? 125...
Avigilon Profits Surge, Stock Jumps (Q2 2017) on Aug 10, 2017
Avigilon said earlier this year they would shift their strategy to maximizing profits. Now, they are delivering it and the stock market is...
Vivotek Acquisition Offer From Delta on Aug 10, 2017
One of the largest remaining independent video surveillance manufacturers has received an offer to become majority owned by Delta Group, a Taiwan...
Competing Against G4S on Aug 09, 2017
G4S Secure Solutions is a global company, operating in multiple countries and offering a suite of products and services from guards to their AMAG...
Dome Versus Turret Camera Usage Statistics 2017 on Aug 07, 2017
Turret cameras are a growing segment within video surveillance. Indeed, many integrators argued strongly for turrets in an IPVM...

Most Recent Industry Reports

FLIR Restructures Security Division on Aug 22, 2017
FLIR's goal was once to have a single end-to-end security solution. However, FLIR's Security business unit has been struggling, with several areas...
Honeywell Total Connect 2.0 Tested on Aug 22, 2017
Honeywell is one of the biggest brands in security, with Total Connect 2.0 being the company's remote security and smarthome platform. We bought...
IP Camera Cabling Testing Statistics on Aug 22, 2017
Test and certify, or crimp and pray? Some integrators certify every cable they run, while others only inspect cables that have video issues. 130...
Dahua 4K IR PTZ Tested on Aug 21, 2017
4K has made its way to IR PTZs. In this report, we examine the Dahua 6AE830VNI, a 4K PTZ with 30x optical zoom, 200m (~650') integrated IR, and...
Top Used License Plate Capture Cameras on Aug 21, 2017
Capturing license plates is a common video surveillance application. But what cameras do integrators mostly commonly used? Special purpose LPC...
VLAN For Video Surveillance Usage Statistics on Aug 21, 2017
VLANs (see our tutorial) are an option for networks using video surveillance, but how often are they actually used? 125+ integrators told us how...
Avigilon CEO Attacks Asian Companies Cyber Insecurity on Aug 18, 2017
Avigilon CEO is taking aim at their Asian competitors. And he is going directly after these company's cyber security issues. In this note, we...
Sony Next Gen HD Dome Camera Tested (SNC-EM642R) on Aug 18, 2017
Sony has released their latest generation, claiming improved WDR and low light, increased IR range, and more. We tested the SNC-EM642R outdoor IR...
IP Networking Course September 2017 on Aug 17, 2017
This is the only networking course designed specifically for video surveillance professionals plus it includes live training, personal help and...
Knightscope Raises $10 Million With $3,320 Average Per Investor on Aug 17, 2017
Congrats to Knightscope. And condolences to their legion of little investors. Knightscope has disclosed they have raised $10+ million from their...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact