News analysis AViXA looks at the impact of the virus


AViXA’s Impact Survey is a weekly assessment of pro AV industry trends, attitudes and perceptions considering the novel coronavirus and COVID-19 pandemic. Survey respondents are having a hard time envisioning how the pandemic will play out for their businesses, with greater shares citing declining revenues and slower sales.


Respondents indicate their companies are resorting to lay- offs and furloughs while seek- ing emergency funding. The rise in conferencing and collab- oration to support remote work is likely not only a short-term trend, but it could also indicate new ways of working after the pandemic subsides. More than 325 members of the AVIXA AV Intelligence Panel took part in the COVID-19 Im- pact Survey. And despite efforts by some local governments to begin


relaxing social-distanc-


ing restrictions and gradually open their economies, industry uncertainty seems to be reach- ing a peak. The longer this ex- traordinary situation persists, the less clear the other side appears.


Industry comments


One AV provider commented: “Almost everyone I have spo- ken to does not have a clear understanding of the long-term impact this will have on their ability to do business, the eco- nomic impact, and the length of time it will take to recover.” “As the virus spreads,” said an- other, “there are more project install date cancellations. We have been pushing projects out a month or two, but uncertainty is forcing companies to cancel scheduled installs.”


And: “In general, it comes down to uncertainty in com- mercial real estate. I'm a small AV consulting firm and we have several projects on the burn- er until this clears up. The question is, will we run out of working capital before this hap- pens? Will we get approved for a small business loan? Do we feel confident that even with a loan, we'll be able to make back our losses and repay the loan? The not knowing is the hardest part because it limits your strategy.” In


this most recent survey, fielded April 14-15, growing shares of respondents are cit- ing declining revenues, slowing sales, and significant layoffs or furloughs as the COVID-19 pandemic continues to paralyze societies around the world. This week, 74% of AV provid- ers, including 83% operating outside North America, report- ed experiencing revenue de- clines over the prior week. That is the highest percentage citing falling revenues since AVIXA Market Intelligence fielded the first Impact Survey. Nearly 72% of all AV provid- ers cited slowing sales, also a new high and up from 66% last week.


Percentage declines


When asked to estimate the percentage decline in revenues, 33% of AV providers, including 46% of international respon- dents, pegged the revenue drop at more than 50%. That, too, is the highest that measure has ever been since the survey be- gan.


Every company is different. According to one AV provider: “Many AV companies, especial- ly in live events and rental and staging, are experiencing 80 to 100% reductions [in revenue], with total cancellation of work.” Another added: “We are an


AV systems integration firm and have experienced almost a com- plete drop-off of business. Our primary client is the Canadian Federal Government, and they are not transacting beyond Tier- 1 providers (i.e., direct with Cis- co, Poly, Microsoft, etc. and not


ic challenges posed by the pandemic, more respondents say their companies have re- sorted to layoffs or furloughs. Nearly 44% of AV providers cited layoffs/furloughs as a response to the pandem- ic.


layoffs/furloughs


Globally, respondents in North America are more likely to say their companies have instituted


(over 44%) than international respondents (30%). What has changed rapidly has been respondents’ un- derstanding of the extent of those layoffs/furloughs. Al- though 18% of AV providers said their companies had laid off/furloughed 1 to 5% of em- ployees (up from 9% who said so last week), a whopping 30% of all AV providers cited layoffs/furloughs of more than half their staffs. “[We’ve] re- quired a two-week furlough or PTO for each employee


indication of how especially im- pactful the COVID-19 pandem- ic has been for the live events segment of our industry. “Until we have a cure or vac- cine, we are not going to have very many — if any — large events,” said one respondent.


Financing operations


In addition, growing shares of AV providers are looking for ways to finance operations during the pandemic. Slightly more than 54% said they’d ap- plied for government loans, up from 46% last week, and 49% were dipping into their cash reserves, up from 39%. “Our boss applied for payroll assis- tance benefits in hopes that it will allow us to rehire two techs laid off in March,” said one re- spondent. Turning to the staffing issue, companies with employees who


cess of drafting workplace re- quirements to limit personal interactions and will require the use of masks when we do return to the office,” said one AV provider. “Employee safety is even more of a priority than ever,” said another. “Monitor- ing employee compliance is also being made a priority.”


Forward planning


Although the largest share of all AV providers (29%) is eyeing a return to project work in June, a growing percentage (19%, up from 15%) thinks July is like- ly. This subtle shift is due, in part, to growing shares of AV providers outside North Ameri- ca and live events professionals estimating July as when things start turning around. Still, a significant percentage of all AV providers (15%) has Sep- tember circled on the calendar.


AV customers indicate they


will be looking at ways to incor- porate what they’re doing now, under extreme circumstances, into their regular operations. “Education will place more focus on distance learning,” said one end user. “I also think big business and larger govern- ment institutions will upgrade onsite conferencing facilities to integrate lessons learned during COVID-19. Lastly, I think medi- um and smaller businesses will develop and implement strat- egies to promote and manage more distance-working options, as it will take a while to com- pletely go back to ‘full normal' social interaction.”


According to another end user respondent: “In-person learn- ing will be paired with synchro- nous, online [learning] so that consumers will have the option of attending in person or on- line. There will likely be an up-


Although the largest share of all AV providers (29%) is eyeing a return to project work in June, a growing percentage (19%, up from 15%) thinks July is likely


through integrators). Literally a 95% drop in revenue.” The weighted average of reve- nue responses indicates an aver- age estimated drop in revenues of about 19% across all AV pro- vider respondents.


Coping mechanisms In order to cope with the econom-


between now and June,” ac- cording to one AV provider. An even greater share of live events professionals - 64% of a limited sample - said their companies had laid off/fur- loughed more than 50% of their employees. Not a single live events respondent cited layoffs/furloughs of less than 30% of their workforce - an


can do their work from home have already implemented tele- work programs, cut


business


travel, and eliminated meetings and events. Some also say their companies are also navigating the various guidance and reg- ulations from local agencies in an effort not only to comply, but also to protect workers. “Our company is in the pro-


Virtually no respondents claim visibility beyond that point. On the other side of this pan- demic, many continue to see opportunity in conferencing and collaboration (80% of end users and 83% of AV providers) solutions. Content distribution, to include streaming/broad- casting of content to remote audiences also rates highly.


take in flipped classrooms, with lectures being recorded in short videos and class time used for discussion, either in person or online.”


P12 AV News November 2019 P8 AV News May 2020


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