The Impact Survey is a weekly assessment of pro AV industry trends, attitudes and perceptions in light of the novel coronavirus and COVID-19 pandemic.
- The respondents who say their company has been impacted negatively has fallen.
- Even so, a larger percentage indicate their revenues are in decline.
- For the first time, 40% of AV providers dealing with declining revenue reported reducing salaries.
- End users still say their organizations are struggling and they’re cancelling projects.
Call it an uneasy calm. After plateauing for three weeks, there are some indications at least that things aren’t getting any worse for pro AV professionals during the COVID-19 pandemic. If anything, some may be turning a corner. But there are also signs recovery will take a while.
In the most recent AVIXA® COVID-19 Impact Survey, fielded May 12-13, 22% of AV providers said their companies were running at full capacity, up from 15% last week. Said one AV provider, “As a company, we seem to have found our sweet spot in dealing with the current COVID-19 situation. The vast majority of our staff is working from home, meetings are being conducted online, and the work is getting done. We are relying on our regional staff members to do the heavy lifting for installations due to travel restrictions, and the less experienced team members have risen to the challenge and have acquitted themselves admirably.”
The share of AV providers in the latest survey indicating their companies had been negatively impacted by the pandemic was down to 61%, from 70% a week ago. That share is also now smaller than the share of end user customers citing negative impact — 63% of end users say they’ve been impacted negatively, up from 58% last week).
This is the first time since AVIXA Market Intelligence began fielding the Impact Survey in March that a greater share of end user customers cited negative impacts than AV providers. Such input bears monitoring as a leading indicator of future project work. Of end user respondents saying their organizations had been negatively impacted, 78% said they’d cancelled projects, a figure that has remained stubbornly high over that past month.
Said one end user, “A few projects are moving forward, but many more are getting put on hold if they're not already in-flight.”
Said another, “Our team is beginning to use this time to cross train for possible changes to business in the fall. Specifically, Zoom support and streaming options.”
In a limited sample of live events professionals, 88% said their companies had been negatively impacted, roughly the same figure as we’ve seen throughout the pandemic.
“With graduation season quickly approaching, we are nearing time to host our first larger-scale virtual events,” explained one event provider. “We assisted in preparing an on-demand virtual event … and encountered some issues [on] the IT side of things, as opposed to the AV side we're used to dealing with … Those in the live event space that have been paying attention to the pulse of the industry and/or have in-house, IT staff are going to have a slight advantage, but that's not to say those who weren't can't get where they need to be with the right resources and personnel.”
For Some, a Turning Point
As you would expect, the share of AV providers reporting no impact/positive impact from COVID-19 has ticked up slightly to 39% from 30%. Of those AV providers, 40% were seeing a resumption of projects and 30% an increase in client inquiries.
Of all AV providers surveyed, 40% said their companies were seeing a resumption of projects and 30% saw an increase in client inquiries (31% of all end user respondents said they’re resuming projects). Globally, 41% of North American AV providers said their companies are resuming projects, as opposed to 27% outside North America.
Of all AV providers surveyed, 40% said their companies were seeing a resumption of projects and 30% saw an increase in client inquiries
The share of all AV providers resuming staff hiring came in at 15% (7% outside North America), a very early and limited indication that some companies may be starting to ramp up. Overall, our analysis indicates only about 11% of the reported workforce reductions have been permanent layoffs, as opposed to furloughs.
According to one AV provider, “As weather has gotten warmer [here], things are starting to open a bit. Schools that were on total lockdown are now letting vendors in again. We had one of our best April sales months ever, including a dozen new projects and lots of box merchandise sales. Cash flows continue to improve. We're doing well, all things considered.”
That said, respondents’ predictions for when the bulk of their project work resumes continues to push further out. Only 14% of AV providers and 24% of end users now think projects get back online in June. On the AV provider side, the most notable jumps are in those predicting July (up to 20%), September (up to 16%), and “next year” (leaping to 15%). End users looking beyond June are coalescing around August (17%) and September (20%).
The majority of the limited sample of live events professionals are looking ahead to 2021.
Revenues in Declines, Sales Slow
Although at the highest level, survey respondents continue to be less negative about the week-to-week impacts on their business, more are growing concerned about revenues. Of AV providers citing negative impacts, 78% said they’ve seen declining revenues. That is the highest that figure has been since the survey began. Taken together with all respondents, it implies a weighted average of 48% of all AV providers feeling the effect of revenue reductions, up from 44% last week.
Asked to approximate the reduction in revenues, AV providers’ responses ran the gamut, with the largest shares at the low end (6% to 10%) and very high end (91% to 100%). The weighted average of all responses indicates an average revenue decline of 21%.
When it comes to sales, 70% of AV providers citing negative impacts said they’d seen sales slowing, on par with last week’s 71% and roughly the high mark throughout the survey’s existence. The weighted average of all AV providers in the survey with slowing sales is 43%.
“We have rehired a small number of workers,” said one AV provider. “We've resigned ourselves to planning a 60% to 65% reduction in annual sales. We anticipate operating at 25% of our 2019 capacity by September. This is a far cry from normal operations, but rather the new normal. We don't anticipate a return to our 2019 sales levels or production capacity until 2022.”
Looking at how companies are adjusting to the current situation, the share of AV provider respondents saying their companies have implemented pay cuts peaked this week at 40%. That is the first time salary reductions have outpaced layoffs/furloughs (33%), indicating companies continue to exhaust available options in dealing with the crisis.
On a human note: Since beginning the Impact Survey in March, AVIXA Market Intelligence has been grateful for all the thoughtful, meaningful feedback from AV professionals sharing their firsthand perspective of business (and life) during the pandemic. We’ve heard how companies are adapting, supporting employees, and staying safe.
This happens to be the first week we’ve heard this specifically, from an AV provider, a reminder that what we’re going through could touch any one of us: “We have had employees who have tested positive,” the provider said, “and a few have had to self-quarantine. All are following CDC guidelines.”
Our thoughts go out to anyone dealing personally with COVID-19. As we all prepare to resume life, we appreciate professionals sharing their efforts to stay safe in the months ahead.
“Our company is making modifications to the office in preparation for returning to the facility,” said one AV provider. “Touchless faucets and toilets are being installed, as well as additional door hardware that reduces the need to use your hands. The company is stocking standard masks for office use, as well as N95 masks, gloves, and glasses for site visits. New policies and procedures are currently being developed as well.”
Said another, “We’re still having at-risk age groups work from home; still having our weekly operations meetings on Zoom; still supplying our techs with necessary PPE [personal protective equipment] for service calls and installs.”
We're in this together.
The next survey results will be released on May 22.
If you would like to participate in the AVIXA AV Industry COVID-19 Impact Survey or other AV Intelligence Panel studies, please join the AVIXA Insight Community at avip.avixa.org.
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