Azione Unlimited President Richard Glikes urged electronics integrators to...

Azione Unlimited President Richard Glikes urged electronics integrators to ratchet up labor rates, in an open letter warning of a “clock on profitability and hardware.” Citing threats from cloud storage and home control apps, Glikes compared current home AV and control hardware to the “cassette and 8 track of the past” that will soon be gone from the market due to declining margins. Labor is “the one thing you can’t substitute,” Glikes said, saying custom electronics dealers “don’t charge enough” for labor and “don’t manage it well.” Glikes suggested an hourly labor rate of $149, comparing the service aspect of custom electronics to the plumbing and electrical professions. “Does your plumber or electrician have any compunction about charging you a flat fee to enter your home regardless of problem, time, or materials?” Glikes asked. Customers pay it because “that is the way they conduct business,” he said. We asked Glikes about the conundrum of charging high labor rates for service and maintenance for products that are increasingly seen as replaceable and cyclical, and he said, “A $10 light switch costs over $100 to be installed. A $50 faucet can cost $150 to be installed.” On the need for installers in the age of do-it-yourself home control products found at Lowe’s and simple multi-room audio systems from Sonos, Glikes said, “A Kia will get you to the same destination as a Mercedes but the experience is not the same.” Azione dealers’ affluent clients “have more money than time” and are willing to pay to have electronics “designed, installed, and serviced well,” Glikes said. Azione’s spring conference in Las Vegas (March 19-21) will have a roundtable on managing and making labor profitable, he said.