Market Monitor 2019

30 Aug 2019

NECA has finalised its biennial Market Monitor industry survey, with the highest response to date.

The lengthy online survey completed by more than 1,500 respondents between February to April 2019 covers a range of areas of interest to the industry, and the ongoing nature of the study allows for the examination of trends in key areas.

These areas include overall sentiment and business confidence, the purchase process including decision making, ordering and the channels and methods used to purchase materials as well as the role of manufacturers and their brands. It also zooms in on the topic of compliance and what that means to contractors, the impact of digital and new technologies and the perceived influence of the end-customer.

Insights from the 2019 survey contribute to both NECA’s understanding of changes in the electrical and communications industry and importantly, the development of key advocacy policies on behalf of members.

From the survey this year, it is clear the electrical industry is in a state of rapid technological change – perhaps at a rate not seen before in recent history.

This is a challenging time to be a contractor, due to the emergence of these new technologies, but equally is a time for industry leaders, wholesalers and manufacturers to step up.

Nature of the work

Residential and commercial projects continue to provide the mainstay of work for most electrical contractor businesses, regardless of size, with maintenance and renovation/ refurbishment projects a prominent source of business. Compared to previous years, companies appear to be relying less on a single type of work for much of their revenue and are instead branching out.

Optimism on the up

Optimism for future work remains high among survey respondents, with pessimism and concern for future work decreasing compared to previous years. High levels of optimism are most noticeable in bigger businesses (with over 5 employees).

External factors for concern

Contractors feel that external factors outside of their control will assert the greatest influence on their future business. Concern around general economic conditions and competition from other business remains high, but it is concerns about the cost and availability of skilled labour, and government legislation that has been growing year on year.

Going, going, gone digital

The ability to conduct business online continues to transform the way the electrical industry operates, especially for younger contractors. More and more contractors are using social media as a business tool, with two thirds using Facebook, and one quarter using Instagram.

This year 80% of survey respondents said they research product information online, with almost one third of businesses now order supplies online. The new technology gap is in ordering apps - 8% currently use an app to make orders, but 20% would like to be using an app.

Compliance is still top of mind

When choosing which brand of product to purchase, compliance is key. Contractors feel confident they understand compliance and the risks that come from not using compliant products, however a majority feel that their end-consumers do not understand compliance. Unsurprisingly, there is a high level of confidence among contractors that buying from trusted wholesalers will ensure they have compliant products.

Technological change is at the fore

Smart technology, IoT and automation are predicted to have an increasing impact on the industry, with around one third of contractors gearing up for this shift. Solar energy, battery storage and renewables also remain top of mind. However, at this stage these anticipated changes in the industry are not having any noticeable impact on the number of companies choosing to specialise in these areas.

Interestingly, contractors feel that the greatest threat to technological change in the industry is through the purchase and installation of poor quality, non-compliant products and (perceived) growing numbers uncertified or inexperienced tradespeople. They also acknowledge the skills and labour gaps in these emerging technological areas.

Polarity in end-consumer knowledge

Half of contractors surveyed feel that their end-consumers are more knowledgeable than they used to be however contractors expressed that this makes their job more difficult. According to those surveyed, there appears to be a growing gap in end-consumer knowledge levels, from the technologically illiterate to tech-savvy early adopters, and contractors are finding it challenging to communicate and converse across all levels of knowledge.

Thank you to all of you who took the time to complete the survey and congratulations to all our prize winners. Look out for the NECA Market Monitor industry survey in 2021.

 

Contacts
Wendy Ramjee - Executive Assistant to CEO
E: wendy.ramjee@neca.asn.au
T: (02)  9439 8523
National Communications and Marketing Manager
E: marketing@neca.asn.au
T: (02)  9439 8523