How integrators face the recession

Integrators need to ramp up service, focus on training, look to alternative revenue streams


One potential opportunity for integrators in the non-traditional realm of surveillance projects could be the installation of high-temperature cameras.

Lenox, a Pennsylvania-based manufacturer of CCTV solutions various industries recently announced that they are seeking integrator partners to install furnace and boiler diagnostic camera systems commonly used in power plants and other large industrial facilities.

Paul Lang, vice president of Lenox, estimated that there is probably a $5 million to $10 million market in the installation of these types of camera systems.

Opportunities also abound for physical security integrators in the realm of Intelligent Transportation Systems or ITS. According to Jerry Molinaro, regional account manager for UK-based CCTV solutions manufacturer IndigoVision, as more municipalities are forced to cut their budgets in response to the economic crunch, more will turn to technology as a means to combat traffic problems, as well as crime.

"Really we're seeing a lot of expansion, not only locally, but globally in this opportunity because police departments just don't have the opportunity to be everywhere," he said .

Whereas ITS systems were originally launched to monitor traffic flow, Molinaro said that many cities have begun merging them into one large, networked surveillance system that can also be monitored by their police force. He added that the market for ITS is two-fold for integrators, one in installing the surveillance infrastructure and the other in setting up a network system, which can increase the price tag of a project by five fold.

"In a lot of the areas of the country this is just becoming a huge mushroom effect," the IndigoVision regional manager said. "It's piecemeal now, but in the next three to four to five years, it's going to be a very large opportunity (for integrators) because what we're seeing is the cities are installing five cameras, and then they have success with it and they have to go get another 20, and then when they get success with that they produce large projects."

According to Molinaro, IndigoVision is currently involved in the installation of 50 to 60 ITS systems, which he says is expected to grow over the next several years.

Coleman indicated, however, that it may be hard for many integrators to invest the time and resources that it would take to learn how to install a new type of camera system being that they are already going to be stressed with the bad economy.

"For some companies that might make sense, but in the early stages of the recession we're seeing people across the board pulling back on the reigns, not spending what they don't have to," he said. "Trying to get into a new field when everybody is pulling back I'm sure is a challenge. Anytime you branch off into something new there is a learning curve, but if you're in a desperation situation, I guess you do what you have to do."

As business does slow as it almost certainly will for most integrators, Coleman said that it is a good time to work on your company's fundamentals.

"During downturns like this, when there's more challenges in landing new projects, that's a time to emphasize fundamentals," Coleman said. "You could tolerate inefficiencies during good times. Now is a good time to go in and work on fundamentals -- good service, good installation practices and hustling on the sales side to differentiate yourself from the folks you're in competition with."

There are several keys to making it through a recession, according to Bozeman, the first of which is training, followed by having the right products and breaking from the traditional physical security mold and perhaps partnering with other network integrators. It's also a good idea, Bozeman said, to switch your focus away from areas such as retail and gaming, which will be hurt during a recession and moving towards vertical markets that are more recession resistant like transportation, healthcare and government.

"I can tell you this. If the physical security integrator doesn't (change their focus), other people will," he said. "Video surveillance was once strictly security and that was it; that's just no longer the case. As time goes on there's going to be more and more opportunities [in other surveillance markets]."