According to a report in the Singapore newspaper, The Straits Times, nine in 10 Filipinos are upbeat about 2015. This seems to transcend how the AV industry in the Philippines feels as well..All those who responded to the survey felt that the AV industry would do well this year. Though the Philippines economy grew slower in the third quarter of last year, it is expected to pick up pace. In fact, Credit Agricole said it expects the Philippines to get its groove back with a growth of up to 7.3 percent for this year.
The country of course, was in a frenzy in January when Pope Francis visited. In fact that generated five days of Public Holiday but somewhere in there some Rental & Staging companies were busy preparing for the visit. In fact this segment of the industry expects to see continued growth. Another big event that will take place in the Philippines this year is the APEC summit in November, which should augur well for the AV business.
SI Asia did a survey with the AV industry in the Philippines and here are some of the findings that we hope you will find interesting. Please note that the percentages indicated is related to the respondents’ expectations for each option provided and would not add up to 100% for some questions.
Every single respondent to the survey agreed that there will be growth in the AV business this year, with a higher majority strongly agreeing to our statement.
HOSPITALITY EXPECTED TO SEE THE STRONGEST GROWTH
It should not come as a surprise that the industry expects the strongest growth from the Hospitality sector. 50% of our correspondents voted that this sector would be the strongest. Apart from new casinos, there are a number of hotels springing up as well. The Houses of Worship (HOW) segment came in a strong second in terms of growth prospect. The HOW segment has actually been building up for some time. Last year, Iglesia Ni Cristo built the largest indoor stadium in Asia and the church is also planning to build a new convention centre soon. This is just one 2% example of the growing HOW segment.
SOUND REINFORCEMENT SOLUTIONS TO LEAD THE PACK
Respondents felt that Sound Reinforcement would see the strongest growth in terms of solutions, followed by Video/Audio conferencing solution and control systems.
AFTER-SALES AND MAINTENANCE SERVICE
Asia lags far behind USA and Europe when it comes to creating a service package as a stand alone revenue generator. Many a time System Integrators throw it in as a value-add service due to pressure from clients. However, this practice is slowly changing. 75% of our respondents indicated that they do provide after-sales and maintenance service with the remaining respondents indicating that they do intend to pursue this as a revenue generating option. It will be interesting to know what percentage would this constitute of their overall revenue.
With the exception of one respondent who indicated that this would constitute a healthy 25% of their total revenue, ￼￼the majority fell between a mere 4% to 15%. This just reaffirms that the AV industry needs to push after sales and maintenance as a service and not a value-added bonus.
Of course this should not come as a surprise any more but we just wanted a reaffirmation. Almost every installation that we now cover, has an element of IT involved. In fact for some our respondents this affects 80% of their integration work.
EDUCATING CUSTOMERS AND THE INDUSTRY
Our respondents indicated that their greatest business challenge is that customers are only concerned with pricing. Tackling this will require the whole AV industry to be in sync. It is not surprising that many AV companies try to win a contract by offering quotations with low margins. This is compounded by clients who are not looking at the whole solution holistically. It generally ends with a dis-satisfied customer. It is not to say that quotations should be high but AV companies should definitely take into consideration the value and expertise provided by them.