Famed Irish playwright George Bernard Shaw once quipped “Britain and America are two nations separated by a common language.” However, in the smart home industry integrators on both sides of the Atlantic Ocean speak the common language of “business.” And that is exactly the topic that D-Tools explored during two separate sessions in the Technical Theatre at the EI Live! show in Farnborough, UK, on September 18-19.
Jason Knott, D-Tools Data Solutions Architect & Evangelist, addressed the gathered group of integrators during the opening keynote at the event, which was held at the Farnborough Exhibition Centre about 40 miles west of London. The presentation focused on the state of business for custom integrators, reviewing aggregated data drawn directly from D-Tools Cloud, which is the company’s cloud-based software used by more than 3,000 integration companies worldwide. The information, much of which is in the company's 2024 Midyear Market Report, covered proposals, signed contracts, close rates, profit margins, change orders, and looked at the current state of the control, display and motorized shade markets.
“The smart home industry is generally similar in terms of operations in the UK and in the US, although there are some differences. My hope is that this information will be similar to what you are facing from a trend perspective here in the UK and you can come away with some actionable steps for your company,” Knott told the audience.
Jason Knott of D-Tools conducted an exercise with attendees at the EI Live! show in London on labor profitability.
In a later session that closed out the EI Live! Technical Theatre presentations, Knott was joined by Konrad van Eck, D-Tools account executive for the region. The session examined how UK integrators can calculate their breakeven labor rates for an entry-level technician. According to the information, UK integrators paying a technician £16.93/hour have a breakeven labor rate of £49.33/hour after including direct costs (insurance, holiday/sick time, paternity leave); indirect costs (association dues, training, rent, office expense, bad debut, legal fees, payroll processing) and the standard labor utilization rate of 55%. Moreover, to earn 51% profit margin on that labor, UK integrators would need to charge customers an hourly rate of £73.99.
“I think every person on your staff should be made aware of the breakeven and profit rates, so they know how important it is to be efficient in the field,” said Knott.
Van Eck then walked attendees through the D-Tools software solution that enables users to identify various types of labor, set their rates and their profit margins on those labor activities.