One stop shops have got it all?

• Features

• 07/01/2021

Some trends require insight to observe. Others are obvious for all to see. When it comes to manufacturers making moves over the last few years, diversification seems to be the name of the game. Companies and brands have been expanding their product offerings to encompass entire ‘ecosystems’ in an effort to become ‘one-stop shops’.

The thought process driving the trend is simple. If a client is coming to you for a product, say a loudspeaker, why not also offer them all the other components they will inevitably need to create a fully working system, amplifiers and DSP in this case? But how have these ‘one-stop shops’ been received by the AV industry?

Essam Refai, senior audio visual engineer at Aurecon, says: “This trend towards one-stop shops has been happening for the last few years and more manufacturers have been focusing on this. But I believe every manufacturer has its own core expertise. For example, AMX, Extron and Crestron started as companies doing control and then expanded into video and more recently moved into audio but it would be fair to say that they are still strongest in control and video. From our point of view as a designer and a consultant, we will perhaps look more towards these brands for the product verticals they are strongest in and are known for. For microphones we might go to a company like Shure or Sennheiser or someone similar and for a DSPs we might look towards Biamp or QSC or someone similar.”

Acquisition has been a common path taken by manufacturers to flesh out their product lines. Does this assuage Refai’s comments of core expertise?

Refai answers: “Even when a manufacturer expands its product line up via acquisition, we still have reservations. Obviously, the transition from one company to a new parent company comes with challenges which means that we may approach that product with a level of caution.”

There are ways to overcome this caution as Refai says: “With the current situation it is not as easy, but our priority is to get our hands on the products. We are definitely getting the marketing message from manufacturers, but when it comes to products like DSPs and so on we want to see a live demo as much as possible or actually test the equipment. You can evaluate the tech specs but that is not a definitive result for us. And if a hands-on demo is not possible, then we rely on examples of where the products have been installed and may even reach out to the clients who use the products and get feedback from them.”

So how has the emergence of one-stop shops changed the AV industry’s landscape? Refai comments drawing on his experience: “Specifically in Australia, we’ve seen there be friction due to the manufacturers’ expanding product lines. If a distributor has competing or similar brands, then there is bound to be conflict and their job is getting harder. We have seen large manufacturers, Crestron [in Australia] for example, start going direct to market instead of going through a distributor to meet their requirements. We would prefer to have a proper channel that we could rely on for engineering support and service, but we also understand that with the evolving product offerings from manufacturers this may not always be possible.”

He continues: “We are seeing manufacturers or suppliers coming directly to us. The distributor is being turned into a channel that moves boxes and still offers support and service. But more and more manufacturers want to talk directly to the integrators or consultants to ensure they have the communication to fully present their whole range of products when it comes to procurement.”

Stephen Ward, general manager for New Zealand at Midwich, offers the distributor’s perspective: “We actually believe that the market needs smart distributors more than ever. If we bring our ‘A game’ we can outperform manufacturers and one-stop-shops. They may be going direct to consultants and integrators with their solutions and designs, but you have to realise that what they are presenting is a single solution. We can match them in this regard but the important thing to note is that we represent more than one brand. We’re not approaching AV professionals with a single solution; we have the ability to provide multiple solutions based on our product portfolio, which allows the AV professionals to decide which route to go down. This is a crucial advantage that smart distributors will have.”

Ward also believes there are situations that one-stop shops are not designed to address. He provides an example: “If you are a system integrator and you have a client with which you have a service level agreement and a piece of hardware fails, what do you do? Integrators don’t carry spares and manufacturers’ logistics are such that they will probably not be able to respond within your timeframes. However, as a distributor focused on the AV channel, Midwich has ‘spares’ in the form of stock holdings and in this case we are the best placed people to assist the integrator with their problem. We leverage our strengths such as our global footprint and our local expertise in the form of the people we have on the ground. Our buying power then ensures that the AV channel benefits.”

From the impact on the industry, we start to delve into the impact ‘one-stop shops’ have had on the roles and functions of AV professionals. Refai says: “If you evaluate ecosystems, they are good for consultants because they are less risky since there is only one entity responsible for them. The manufacturer or their partner takes on all the responsibilities of providing the needed support. It is definitely less complicated than having 15 different brands on a project, narrowing this down to two or three brands greatly simplifies matters.”

Sunghoon Lee, CEO and audio visual consultant at SYM Consulting, agrees in part: “From a consultant’s perspective, the trend of having technology ecosystems or ‘one-stop shops’ has definitely reduced the burden of design on cosultants and that can be seen as an advantage. If we select one product from one manufacturer, for example a microphone, DSP and loudspeaker all packaged together, we save time trying to pick all the components from different manufacturers’ catalogues.

“Integrators [in Korea] like the trend of having all the products come from a single manufacturer. Obviously from a procurement point of view it is much easier to have a one-stop shop. Also, some Korean integrators might not have the capabilities to offer repairs, maintenance and programming and in this case, they rely on the manufacturer. With just one manufacturer to reach out to their job is made easier.”

On the matter of risk however, Lee’s opinions differ: “The nature of the Korean AV industry is such that companies come and go. If a distributor, integrator or manufacturer is no longer around to provide the service for the products, this has a huge impact on any consultant’s designs. Who will take care of the system? If our designs are based on the products from only one manufacturer, you can see how this problem is magnified.” It is important to note that for now ‘one-stop shops’ are not expansive with regards to applications. Lee actually ties the rise of one-stop shops to the push for establishing global standards at the offices of multi-national corporations.

As more companies wish for a similar, standardised experience to be offered at their working spaces wherever in the world these spaces might be, template systems start to emerged. From here, manufacturers have expanded to provide products that fit these templates.

Refai explains why this makes sense for manufacturers: “In the cases where you have a standardised or templated room, brands want to make it so that they can go directly to the IT or technical department of the company who is in charge of procurement. These guys want a quick, easy and reliable solution.

So, having a packaged solution is an advantage. We’re seeing this even more and more with Zoom packages that are addressing the demand for videoconferencing across different verticals today. They want to make procuring AV as easy and as direct as procurement for IT solutions, like PCs or headphones or cameras where you can just go to market and buy it.”

However, this evolution from manufacturers does not mean the end of AV professionals.

Refai continues: “The good thing is that Aurecon is very diversified and that the ecosystem trend that we have been discussing is contained to the corporate sector and the workplace. When you look at the templated SKUs available right now, these are for the workplace and more specifically for the small to maybe medium-sized meeting rooms. Once you start moving to boardrooms, town halls, multi-function spaces then there is really no one template solution.”

Is it possible that we will see this templated approach expand? Refai says: “Right now, we are seeing LEDs moving into the boardroom area and I don’t think we will have any manufacturer offering a package that includes LEDs. And when we move away from the workplace, there are projects in other verticals that require complete design for all spaces. We’re working in sports, defence, healthcare and so on and there are no templated SKUs available for such installations. Personally, I don’t see this templated approach be applicable to anything other than small to medium-sized meeting rooms. Other spaces have too much complexity for a template to be built.”

Lee says: “I have been working on making a standard for the ‘function room’ for one of my clients and I can tell you it isn’t as easy as it seems. While the technology component of the standard is complex, you can devise it if you put your mind to it. The problem is the variables which are not in your control. For the function rooms, we not only have to take into account the variables such as room dimensions but also who will be operating the system. Operators have their own preferences and like to have their systems set up in particular ways and it is impossible to develop a standard with these variables.”

But Lee believes that it is inevitable that one-stop shops will continue to grow. He concludes: “I think there is room for standardisation to go further. The systems we are talking about right now are small in the larger scheme of things when it comes to buildings. Right now, we are just seeing template packages being created by AV companies. But there are tech powerhouses like Samsung and NEC who have yet to pay attention to this ecosystem trend. We are seeing them create ‘modular’ displays, which can be expanded to connect to Cisco and Crestron and many other systems. These displays could very easily be the core part of deployments in the future. And looking even further, there is integration that could happen with AV and mechanical features and even furniture and interior design. There are a lot of possibilities still open for ‘packages’ to be created and delivered.”