Looking for a new source of revenue? You may have it made in the shade, writes Jason Turner.

Once you begin to understand the astronomical growth of the smart home market, you start to wonder why any electrical contractor would elect to stand on the sidelines.

According to research firm Markets and markets, the smart home market is expected to grow from $US76.6 billion ($A111.3 billion) in 2018 to $US151.4 billion ($A220.1billion) by 2024, at a CAGR of 12.02%. This growth is accompanied by a corresponding growth in the need for electricians capable of moving beyond the conventional work of installing light switches and ceiling fans and transitioning into the universe of networked, smart home ecosystems.

The fact is, electricians who neglect the opportunities presented by smart home wiring and networking are leaving huge amounts of money on the table.

If you’re an electrician putting in a light switch or performing some other so-called ‘traditional’ electrical job, look around the house in which you’re working. Does the home owner have a smart lock? A security system? Smart lighting? If the answer to any of these questions is ‘yes’, then you have an opportunity to upsell the home owner to additional smart home devices and systems.

Even the electrician who is simply performing a routine repair or maintenance call can encourage customers to add new devices into their smart home system or sign up for a monitoring service provided by the contractor – which can represent a valuable source of recurring monthly revenue, or RMR.

And don’t get the mistaken idea that the home owners want to put these devices in themselves. An article on the
website iet.org, which covers matters relating to BS 7671 (a wiring regulation that sets the standards for electrical installation in the UK and many other countries) dispels that notion. The article referred to a Barclays Digital Homes Report, which found that despite all the smart home gadgets that are targeted directly at the consumer and the DIY market, 66% of home owners are looking for a professionally installed system – which includes the services of a licensed electrician.

So, the obvious question is, how does an electrician get into the smart home market? They’ve already been performing the job of a licensed electrician. They’ve got the lion’s share of the necessary skills. How do they make the jump from everyday electrical work to the rapidly growing, high demand, smart home market?

Many experts declare that the best entry is in the areas that consumers truly want. The aforementioned Barclays Digital Homes Report determined that heating, lighting and security are the top three key growth areas for the digital homes market, so those can certainly be attractive starting points.

Alternatively, an electrician might consider entering the home automation market through an area in which fewer
competitors are focusing their efforts but which show growing potential. Or they might enter those less-travelled areas as a way to supplement the smart home segments they are already covering. Smart, motorised shades match both descriptions perfectly.

The growth of the smart shade and window treatment market is well-documented, based on various factors:

• Consumers are beginning to understand their energy management capability. Smart shades can be programmed to not only to go up or down depending on time of day but also based on interior temperature, sunset/sunrise, and other parameters.
• There are no cords to present safety issues (especially to children).
• A smart phone, home automation hub, or voice command is all that’s needed to control them.
• There are numerous sources of power – solar, AC and DC power, RF, even Power over Ethernet (PowerShades recently became the first company to off er PoE shades to the industry).
• The growing popularity of motorised shades – and the potential for electricians to join the party – is evidenced by how many electrical distributors are starting to carry these products. Electrical distributors are showing more of these items, so electricians are getting a strong message that they should somehow be involved.

So, for the electrician who feels that the motorised shade market might represent a sound strategy for entering the smart home market – or to augment an already existing presence – there are a few critical steps to take to ensure this effort is successful:

Make a full commitment:

Don’t just dabble in the smart shade sector – jump in with both feet. Promote this new capability to your existing customers and advertise it to attract new ones. Don’t position it as a sideline or an add on; ensure that you convey the message that you are fully committed – and fully knowledgeable – about this aspect of the smart home  ecosystem.

Brush up on the right skills:

As an electrician, you already possess most of the necessary skills for smart-shade installation. The one area to really brush up on is networking – to ensure that you understand it inside and out. Electrical devices overall are getting bandwidth intensive with 4K TV and beyond (8K is already here), distributed audio, streaming video services, etc. For these products and services, WiFi will not cut it. Similarly, everything we do in the motorised shade world requires a hard network connection. Every contractor is familiar with a mechanical room for HVAC – they need to t hink in terms of a network room: a specific location where all necessary wiring is goes directly from the specific fixture to the breaker panel (i.e., ‘home run’). This makes troubleshooting easier and cleaner.

Establish relationships and partnerships:

Developing industry relationships and partnerships can be the difference between success and failure in the motorised shade market. Whether it’s for selling, technical assistance, or even aesthetics, these relationships will benefit every aspect of your new venture. This includes reaching out to:

• Home builders: Increasingly, home builders are installing complete smart home packages per buyers’ requests. Creating a pipeline to the home builder can be instrumental to bringing the electrician in on the ground floor for wiring shades and other smart devices.
• General contractors: Again, a fruitful source of business for the electrician, especially with the prevalence of
  smart home systems being requested before the sheet rock even goes up on new construction.
• Interior designers: While some electricians may have a wonderful sense of aesthetics and design, those qualities are far more likely to be found among interior designers – the professionals who will be specifying the shades.

We actually provide sample books for the electrician who feels confident in showing styles, colours and fabrics to the consumer, but a far more effective route is have a revenue-sharing partnership with designers who do this day in and day out.

Knowledge of smart home protocols

This applies for any integrated smart home devices. Many electricians have a rudimentary understanding of Z-Wave
and Zigbee, the two primary home automation protocols. But you’re going to need to increase that knowledge base, as each has its own strengths and weaknesses. (NB: Some shades can operate on a standalone basis using only batteries. However, their downsides are significant, including the tremendous drain on battery life; electrical interference; and difficult with future integration into the smart home ecosystem.)

If you get the idea that you can just jump into this arena any time you want, consider: According to CE Pro’s latest readership data, 31% of custom electronics integration companies already have high-voltage electrical licenses. That’s 31% of CE integration companies that do not require the services of a licensed electrician. And that number is likely to increase, further squeezing you out of the game.

Getting into the smart home sector – and smart shades in particular – is not a difficult process. It starts with making a commitment to doing it, then promoting it; creating connections and partnership with people who spec them and sell them; and brushing up on a few critical skills. Then you’re in the game.