Pelco Cuts Costs and 1% Employees Layoff 2008

By: John Honovich, Published on Dec 02, 2008

Summary: 19 employees cut, salary freeze implemented, corporate jet to be sold, no more personalized license plates.

All in all, this is a very small cut. Relative to the cuts that video surveillance companies are making, these cuts are very shallow. Verint, March, DM and many other small private organizations have made far more significant cuts.

Watch a video and read details of Pelco's cuts [link no longer available].  The local news reaction seems to be over the top. I suspect that is because Pelco is a big, if not biggest employee, in its region.

UPDATE September 28, 2011: New Pelco / Schneider Electric layoffs.

What Does Pelco Cuts Mean?

As I examine in my company risk assessment in the 2009 Video Surveillance Industry Guide, I think the recession will have a significant impact in a variety of sectors with analog focused companies requiring deeper cuts because of the lower starting growth rate.

While you can always claim individual company factors (e.g., Pelco's acquisition), I think Pelco's cut should make clear to everyone that the recession will have an impact on the video surveilllance industry.  Of the traditional video surveillance companies (i.e., analog/CCTV), Pelco is a clear leader. If Pelco needs to cut costs, then all the analog/CCTV companies are likely to have to make cuts - many much more severe than Pelco's.

What Will Happen Next Year?

As we discussed this week in this examination of the recession's impact, the US and EU economies are likely to continue to drop significantly from now until at least the middle of next year. This will have a negative impact on almost all video surveillance companies.  IP video companies growing at 40% the last few years could see their growth drop to under 20%.  Analog companies that were only growing at 10% per year the last few years could drop to -10%. And if your growth is negative, layoffs and spending cuts become almost inevitable.

While I don't think the Pelco cuts today are significant in themselves, I do think industry professionals should view this as a clear signal that the recession is impacting the video surveillance business.

 

4 reports cite this report:

Pelco New Layoffs But CEO Focused On Growth on Jun 08, 2016
Pelco has laid off 43 workers, raising more fears about further decline of the company. However, IPVM has spoken with Pelco's CEO and he says they...
From the Pelco Jet to the Ex-Pelco Yacht on Mar 24, 2012
The Pelco jet was a symbol of the old Pelco. Long gone, the new Pelco is a far less powerful and ostentatious force. Since the $1.5 Billion...
Pelco Layoffs September 2011 on Sep 27, 2011
Schneider Electric has announced layoffs, aka a 'workface reduction' for the Pelco division and Clovis facilities. We spoke with Schneider and they...
Pelco Layoff Examined on Jan 12, 2010
Pelco has announced a layoff of 100 employees, or approximately 4% of their global workforce of 2400. Pelco cites 3 main factors: "the result of...

Related Reports

Vivint Valuation Falls $1.5 Billion on Dec 19, 2019
Residential market struggles continue. Now, Vivint's valuation has fallen $1.5 billion in its impending merger. Inside this note, we examine...
"Good Market, Bad Business Models" - Residential Security on Dec 11, 2019
Industry banker John Mack, at his company's annual event, took aim squarely at the problems in the residential security...
Resideo CEO To Step Down on Dec 03, 2019
Resideo's CEO, Mike Nefkins, is stepping down, just 18 months after being brought in to lead the now plagued spin-out. Inside this note, we...
"Stress in the Residential Market" - Major Lender Exits on Nov 06, 2019
The residential security / 'alarm' market is getting worse, at least for traditional players. Now, one of the biggest lenders in the industry has...
Resideo Stock Plunges 37%, CFO Ousted on Oct 23, 2019
The horrible year for the ADI / Honeywell Home spinout, Resideo, just got worse, with their stock plunging another 37% today. Not even a year...
Knightscope Sells Just 1 Net New Robot In 6 Months on Oct 04, 2019
For the first half of 2019, US government records show that Knightscope has sold just 1 net new robots ('machines-in-network'), inching up from 52...
Anyvision Aims For 2022 Revenue of $1 Billion on Jul 17, 2019
Only 3 video surveillance manufacturers do a billion dollars or more in annual revenue - Hikvision, Dahua, and Axis. Now, Anyvision plans to join...
Knightscope Adds Just 2 Total Customers In Past Year, Yet Raising Money at $300 Million Valuation on May 02, 2019
This is no longer funny. While Knightscope has laughed it up promoting robot selfies, joking about a 'suicidal robot', the man who attacked a...
Verkada Gets Half Billion Dollar Valuation on Apr 26, 2019
Last week, when we profiled Verkada (The Fastest Growing Video Surveillance Sales Organization Ever - Verkada), we predicted they would raise $40...
The Fastest Growing Video Surveillance Sales Organization Ever - Verkada on Apr 17, 2019
Verkada has the fastest growing video surveillance sales organization ever. In less than 2 years, they already have more salespeople in the US...

Most Recent Industry Reports

ISC West 2020 Cancelled Again, Rescheduled For October 2020 on Apr 09, 2020
ISC West March 2020 was canceled. Now ISC West July 2020 has been canceled. SIA and Reed hope to run it in October 2020. This is a masterclass...
Sunell "Panda Cam" Thermal Body Temperature System Examined on Apr 09, 2020
Sunell's Panda Cam is the most visually recognizable coronavirus camera, sold by numerous OEMs around the world. But who is Sunell? This company is...
Use Access Control Logs To Constrain Coronavirus on Apr 09, 2020
Access control users have included capabilities that are not commonly used that can help zero-in and discover potential Coronavirus hotspots in a...
Cisco Acquiring Fluidmesh on Apr 09, 2020
Cisco announced it is acquiring niche wireless manufacturer Fluidmesh. Both Cisco and Fluidmesh have been offering video surveillance solutions...
Junk Debt Laden Convergint Facing Coronavirus Crisis on Apr 09, 2020
Convergint has $1+ billion in junk debt putting significant pressure on the company. While the rapid debt buildup enabled the company to go on an...
Embedded Logix Thermal Temperature Detection System Examined on Apr 08, 2020
Embedded Logix has been producing thermal temperature measurement systems for industry and fire detection for over 10 years. Now, they are entering...
Micron 1 TB SD Cards Aim To Eliminate NVRs on Apr 08, 2020
Micron has boldly proclaimed their latest 1TB microSD "eliminates the need for network video recorders", targeting the growing market of...
US DoD Declares "Can No Longer Do Business" With Contractors Using Dahua, Hikvision, Huawei on Apr 08, 2020
The US Department of Defense has confirmed to IPVM that they fully support and intend to proceed with the NDAA 'blacklist clause' covering Dahua,...
IPVM's 12th Anniversary - Thank You! on Apr 07, 2020
IPVM is proud to celebrate it's 12 anniversary expanding our commitment to providing the industry independent and objective information on video...
Mobotix Thermal Body Temperature Detection Examined on Apr 07, 2020
Mobotix has jumped into the Coronavirus temperature detection market, but how do they compare to thermal incumbents like FLIR or ICI who have been...