NSCA has released its biennial Financial Analysis of the Industry, coinciding with a more optimistic view of the economy and, consequently, offering predictions of new business ventures in 2011.
The new 2010 report allows systems integrators to track and benchmark their past two years in comparison to industry peers to create a more realistic picture for 2011.
The report highlights three areas for 2009 and 2010: company background, balance sheet and summary information, and sales ratios. It is broken down by company size, gross profit, company age, region, focus and sales methods, which makes it easier for readers to measure financial performance. It also examines sales ratios such as range of sales, cost of sales and administrative expenses to manage.
Installations of telepresence and video conferencing systems, networked systems, and A/V applications are all expected to increase in 2011. So, contractors who use this report to compare their accounts receivable, inventory and assets to those of their peers will benefit from a clear path to success.
“More and more integrators are realizing the importance of making informed and educated business decisions and taking fewer risks,” said Chuck Wilson, NSCA executive director. “This report is the perfect tool to understand the financial health of an organization and any potential changes it needs to make to stay competitive.”
Key findings from the 2010 report include:
—Audio/video technologies continue to represents contractors’ largest share of total revenue. This trend continues from 2008.
—While education and corporate venues generate the most revenue, government, healthcare and houses of worship continue to hold steady as profitable market venues.
—Diversity among revenue is hard to come by. Nearly 17% of integrators receive their revenue from a single customer; this number grows for the organizations with $2.1 – $4 million in revenue.
The report bases its conclusions on the median of respondent factors such as accounts receivable, liabilities, assets and equity. It also provides hard data on breakdowns of balance sheets and figures to help integrators better benchmark their own company and percentage of sales figures as well as costs based on company size, location and market.
The 2010 Financial Analysis of the Industry is available to NSCA corporate contractor members at no cost. To download the report or other industry research, visit www.nsca.org/research