Surveillance Pricing: MSRP and Discounts

Author: John Honovich, Published on Jul 07, 2011

To compare prices in video surveillance, one must understand and factor in discounting variances. Significant differences exist between manufacturers in how and what level of discounting they offer. Making it more challenging, manufacturers tend to obscure what their specific practices are.

MSRP as Start

Essentially all manufacturers offer a "Manufacturer's Suggested Retail Price" (or MSRP) which is generally the highest price that anyone would pay for a product.

At the same time, almost all manufacturers sell through channel partners to reach end users. That is, the manufacturer sells to distributors, dealers, integrators, etc. and those intermediaries then re-sell to the end user. Manufacturers always sell their products to their channel partners at a price less than MSRP, i.e., 'dealer pricing'. The level of pricing a channel partner receives often varies - primarily based on the ongoing order size and the level of commitment / exclusivity to that manufacturer.

Street Pricing

Rarely do end users pay MSRP pricing, similar to how car buyers do not usually pay 'sticker price'. The actual 'street price' that an end user pays is less than MSRP. How much less depends usually on two factors:

  • The size of the purchase and the negotiating power of the end user (as in any business deal)
  • The size of the standard dealer discount structure

2 Types of Dealer Discount Structure

In the video surveillance industry, there are two general and very distinct types of dealer discount structure. These are critical to recognize and factor in:

  • Traditional Security Dealer Discount: Generally 40% - 50% off of MSRP, this is a very sizable discount from MSRP. For example, a manufacturer using this structure may have an MSRP of $1000 for a camera but might sell that to its best dealers for $500. The effective street price that an end user will pay may be $600 or $650, far less than the MSRP. While the actual numbers vary by manufacturer, region, etc., this is the general structure of this approach. Like its name implies, the manufacturers that typically use this are traditional security companies such as Pelco, American Dynamics, Honeywell, March Networks, etc. However, some startups adopt this approach as it is the preferred one by long time security integrators.
  • IT Dealer Discount: Generally 10-20% off of MSRP, this is a modest discount. For example, a manufacturers with this approach may have an MSRP of $1000 for a camera but might still that to its best dealers for $850. The effective street price might be $950. Like its name implies, this is common with newer companies with a greater IT orientation. Axis and Vivotek are two camera manufacturers who take this approach.

Comparing Prices

When comparing prices, it is critical to factor dealer discounting structure differences. For example, comparing the MSRPs of a Pelco and Axis camera would be highly misleading without factoring in that Pelco's effective street pricing is much lower than its MSRP because of their larger dealer discounts.

In IPVM reports, we always including pricing and typically including references to online pricing which we have found to be the most accurate (though not perfect) way of predicting street pricing. When a manufacturer's products are not available online, we typically make reference to them either using a 'Standard Security Dealer Discount' and an 'IT Dealer Discount'.

2 reports cite this report:

Negotiating Discounts From Manufacturers on May 26, 2016
Is there room for just a little more discount in your purchase order?   This report outlines some common tactics that often work, and do not work,...
Legal Attack on MSRP - Impact on Hikvision, Sony, Pelco, More on Mar 09, 2016
MSRP? Make Suckers Really Pay? Many video surveillance manufacturers set their Manufacturer Suggested Retail Price (MSRP) to far higher levels...

Related Reports

Ingram Micro: The Blind Lead The Blind on Nov 02, 2017
Ingram Micro, as a huge as they are overall, with $40+ billion in annual sales, has never been a force in physical security, despite, or perhaps...
Anixter End User Sales Troubles on Oct 23, 2017
End user sales have and continue to be a major problem for Anixter's physical security business. Every year, according to various Anixter people,...
Buy From B&H, Ship Direct From ADI on Oct 16, 2017
B&H, one of the largest online sellers of video surveillance equipment to end users, regularly purchases their video surveillance equipment...
'Clowns' Allege Ubiquiti 'Completely Fraudulent' on Sep 20, 2017
A short seller has alleged Ubiquiti is 'completely fraudulent'. Ubiquiti's CEO has responded calling them 'clowns'. Here is the short...
Dahua and Hikvision Entering Access Control on Sep 05, 2017
Until now, Chinese video giants Hikvision and Dahua have held back releasing access internationally. Both companies have now pulled the trigger,...
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...
Hikvision Releases Network Cabling on Aug 04, 2017
Hikvision's expansion continues. From cameras to analytics to thermal to intrusion to access to... network cabling. Hikvision explained: A...
Startup Strops Completely Wireless Surveillance Camera Examined on Jul 28, 2017
European startup Strops has developed a surveillance camera that offers up to 6 days of runtime and cellular communications to create a fully...
Hikvision Distributor Says Hikvision "Top Rated Yet Most Hated" on Jul 12, 2017
The CEO of 2M Solutions, a distributor selling Hikvision cameras under their own as well as Hikvision's brand has publicly declared Hikvision to be...
Hikvision USA Hires VP of Business Development on Jul 05, 2017
Hikvision USA is expanding again, this time in its drive to move up market to larger integrators and end users. In this note, we analyze...

Most Recent Industry Reports

Robot Vandalism on Dec 11, 2017
Vandalism of security systems is a common concern. It is so common that camera vandalism statistics show that designers routinely sacrifice camera...
Access Controller Software Guide on Dec 11, 2017
Properly configuring access controllers software is key to a professional access system. These devices have fundamental settings that must be...
2018 Video Surveillance Cameras Overview on Dec 11, 2017
This report concisely explains the developments for surveillance cameras offered in 2017 and the state of offerings going into 2018, including...
Imperial Capital Security Investor Conference Review on Dec 08, 2017
Investment bank Imperial Capital holds an annual Security Investor Conference where 60+ companies present, including this year: IPVM bought a...
Integrator GPS Vehicle Tracking Statistics and Success Examined on Dec 08, 2017
GPS vehicle tracking is a growing but somewhat controversial topic. On the plus side, tracking may increases productivity by providing greater...
Hikvision NA Biggest Sale of 2017 on Dec 07, 2017
Hikvision North America has been relatively disciplined the past 5 months, reducing the number of sales and the breadth of what is on sale. No...
Security Integrator IT Expertise Statistics on Dec 07, 2017
20 years ago, putting physical security systems on IP networks was just emerging. Today, almost every system is networked in some way, IP cameras...
Lighthouse Deep Learning Camera Tested on Dec 07, 2017
A Silicon Valley startup, Lighthouse, with a Stanford PhD CTO, has released a deep learning AI camera with 3D sensors for just $300. The company...
Access Control Course Winter 2018 on Dec 07, 2017
Learn more below about the Winter 2018 IPVM Access Control Course. Register here. IPVM offers the most comprehensive access control course in...
Broken Hikvision App Exposes Hypocrisy on Dec 06, 2017
While Hikvision talks about a commitment to cybersecurity, their broken app and their insecure 'solution' exposes not only their engineering...

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