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2006 ELECTRICAL CONTRACTOR PROFILE STUDY
TOPLINE REPORT
PREPARED BY:
RENAISSANCE RESEARCH & CONSULTING, INC
PREPARED FOR:
ELECTRICAL CONTRACTOR MAGAZINE
BETHESDA. MD 20814
JUNE 2006
TABLE OF CONTENTS
BACKGROUND and PURPOSE............................................................................................................................................1
METHODOLOGY ...................................................................................................................................................................1
SUMMARY AND CONCLUSIONS .........................................................................................................................................2
DETAILED FINDINGS ...........................................................................................................................................................6
▲“WHO” ARE THE CONTRACTORS? ...............................................................................................................................6
Size of Firms ...................................................................................................................................................................6
About The Survey Respondents ...................................................................................................................................9
Respondent Education ................................................................................................................................................ 11
▲“WHAT” TYPES OF WORK DO CONTRACTORS PERFORM? .................................................................................... 12
Types of Work Currently Performed ........................................................................................................................... 12
Types of Work Currently Performed – By Number of Employees ............................................................................ 14
▲“WHERE DO CONTRACTORS PERFORM THE WORK?” ............................................................................................ 17
Number of States In Which Electrical Contracting Works ........................................................................................ 17
Types of Work: By Sector ........................................................................................................................................... 18
Types of Electrical Projects: Sources of Revenue .................................................................................................... 19
Work in Various Categories (Residential vs. CII and Non-Building) ........................................................................ 21
Types of Residential and CII Work Performed ........................................................................................................... 22
▲“HOW” DO CONTRACTORS PERFORM THEIR WORK? ............................................................................................. 24
Roles in Specification .................................................................................................................................................. 24
Completeness of Plans and Specifications ................................................................................................................ 26
Role of Brand and Manufacturer When Configuring or Working on a Systems ...................................................... 29
Main Reasons for Brand Selection and Substitution................................................................................................. 30
Comparison of Main Reasons for Original Brand Selection Vs. Making a Substitution ......................................... 32
Purchase of Materials for Installation ......................................................................................................................... 33
▲TRAINING ........................................................................................................................................................................ 35
2006 Profile Topline Report (June 2006) Page 1
BACKGROUND and PURPOSE
For over fifty years, ELECTRICAL CONTRACTOR magazine has sponsored its exclusive ―ELECTRICAL CONTRACTOR
Profile‖. This survey is conducted biannually among its subscribers and aims to provide the most complete ―picture‖ of the
contracting industry available from the contractor‘s point of view. The survey provides contractors with an indication of where their
business ―fits‖ into the overall industry, while at the same time providing information that is used to guide and refine the magazine‘s
editorial content.
METHODOLOGY
The survey was conducted by postal mail and via the Internet between April 7 and June 7, 2006 among a random sample of
ELECTRICAL CONTRACTOR subscribers. A total of 1144 surveys were completed during that time, composed of 676 via the
Internet and 468 via postal mail surveys. Each respondent who received the survey via the Internet was sent a follow-up e-mail.
However, follow-up mailings were not made to non-responders in the postal mail sample. An incentive was offered for participation in
the survey: For each completed survey, ELECTRICAL CONTRACTOR magazine would contribute $5 to charity.
The margin of error on the total sample of 1144 is +/- 3% at the 90% level of confidence.
Tables and figures contained in this article come from the data generated by this year‘s ELECTRICAL CONTRACTOR Survey,
which was conducted by New York, NY-based Renaissance Research & Consulting, Inc. (www.renaiss.com), an independent
marketing research firm that specializes in market research for the construction industry.
The Internet option was first introduced in 2004. It is interesting to note that the proportion of surveys completed via the Internet
versus postal mail is approximately the same as in the 2004 survey, suggesting that changes that are observed between this survey and
the one conducted in 2004 cannot be attributed to a difference in samples.
As was the case in 2004, the 2006 survey was produced in 3 different versions. The postal mail portion was conducted as a 4-page
booklet, with the first 3 pages containing core questions that were common to each version. The differences among the versions
occurred on page 4. The Internet portion of the study was essentially the mail portion of the survey posted on the Internet. The major
difference was that in the Internet portion respondents were required in almost all cases to have percentage questions add to 100%.
2006 Profile Topline Report (June 2006) Page 2
SUMMARY AND CONCLUSIONS
This report is organized to answer the questions: ―Who?‖ ―What?‖ Where?‖ and ―How?‖ and ―Training‖
“WHO” ARE THE CONTRACTORS?
Firm Size: A large majority of the contracting firms interviewed are small in terms of both their number of employees: 62%
have between 1 and 9 employees and also in terms of revenue: 68% have annual revenues of less than $1 million.
o These results are consistent with the sample composition of the 2004 Profile Study, suggesting that changes over time
cannot be attributed to a difference in samples.
Respondent Age: Overall, the survey respondents tend to be at least middle aged. The average electrical contractor
participating in this survey is now 49.9 years old, up significantly from the average age of 48.6 measured two years ago. As
noted in both 2002 and 2004, younger contractors do not appear to be filling the pipeline since such a high proportion of
survey respondents are older than 35.
Respondent Education: A majority of survey respondents have some college education; this is the case regardless of company
size (number of employees). Regardless of company size, about 3 in 10 survey respondents got their formal training through an
Apprenticeship or at Trade or Vocational school. Compared to two years ago, the proportion with only a High School
education declined, while the proportion with Apprenticeship/Trade or Vocational training increased.
2006 Profile Topline Report (June 2006) Page 3
“WHAT” TYPES OF WORK DO CONTRACTORS PERFORM?
In 2005, electrical contractors were most likely to have worked on Traditional Power/Lighting projects (cited by more than
95% of electrical contracting firms) and least likely to work on Alternative Energy (cited by about 15%). With only a few
exceptions, larger companies -- generally 20 or more employees-- are more likely to report having worked on each of the
project types compared with firms with 1 – 9 employees.
o However, electrical contracting firms with 10-19 employees are uniquely more likely to work on Geothermal projects and
on Whole House Automation.
o Electrical contracting firms with 1-9 employees are more likely than firms of any other size to work on Home
Theater/Sound projects and on Residential Security/Life Safety.
“WHERE” DO CONTRACTORS PERFORM THE WORK?
Fully three in 10 electrical contracting firms perform their work in multiple states, suggesting that there may be issues of
licensing and certification. Working in multiple states is far more common among larger firms than among smaller firms.
Across the total sample, more of contractors‘ revenue is derived from New Construction (40%) than from Modernization/
Retrofit or Maintenance/Service/Repair, which each account for about 30%. New Construction accounts for a larger
percentage of revenue to large, rather than small, firms. These findings are unchanged from the 2004 Profile Survey results.
Regardless of company size, Electrical/Power Distribution accounts for the largest percent of company sales.
Across the total sample, contractors get more of their business from CII (Commercial, Industrial, Institutional and Public
Places) than from Residential projects. Non-Building projects (Transportation/Lighting and Utility) account for about 6% of
the contractor business.
2006 Profile Topline Report (June 2006) Page 4
“HOW” DO CONTRACTORS PERFORM THEIR WORK?
Overall, 43% of electrical contractors‘ revenue was derived from Design/Build or Design/Assist work. (The vast majority was
done as Design/Build rather than Design/Assist). About 50% of electrical contractors‘ revenue comes from Traditional
Bid/Build work and about 7% comes from ―other‖ methods of bidding. Design/Build or Design/Assist work is particularly
important to firms with 1-9 employees.
Depending on the type of construction involved – Residential vs. CII -- between 20% and 30% of electrical contractors say that
the plans and specs that they receive are ‗less‘ complete compared with five years ago, suggesting an increased role for
electrical contractors in product selection. (This question was first asked in 2006.)
Further, on average, a ‗single‘ brand is specified only about 20% of the time. In all other cases – ‗multiple brands, or equal to -
- or performance specified‘ – other factors come into play. Respondents were asked how much discretion they have in making
a brand substitution. Overall, contractors are able to successfully make brand substitutions about 70% of the time. These
findings are consistent with the 2004 Profile Survey.
Overall, 55% of survey respondents said that they try to stay within a single brand or a single manufacturer when ‗working on
or designing systems where a "Multiple, or Equal, or Performance" specification is indicated. The remaining 45% of electrical
contractors said that ‗it depends on the situation‘.
‗Price‘ and ‗Availability‘ emerge as highly important factors both when initially selecting a brand and when making a brand
substitution. However, ‗Availability‘ eclipses ‗Price‘ in the brand substitution decision.
Not surprisingly, Traditional Electrical Distributors account for the lion‘s share of installation dollars. Although Warehouse
Home Centers are a distant second, they account for a relatively small percentage of spending by firms with 10 or more
employees. Almost all of the contractors buy from multiple sources.
2006 Profile Topline Report (June 2006) Page 5
TRAINING
Training in the next 12 months is taking on increasing importance compared to the past 12 months. While 57% of electrical
contractors said that they or members of their firm took training in the past 12 months, 62% said that they – or members of their firm -
-planned to take training in the next 12 months.
The focus of the course work is generally similar between the past 12 months and the next 12 months, however, two topics are
of higher interest to those taking training in the next 12 months:
o Datacom and Telecommunications
o Green/Sustainable Technology
2006 Profile Topline Report (June 2006) Page 6
DETAILED FINDINGS
▲“WHO” ARE THE CONTRACTORS?
Size of Firms
A large majority of the contracting firms interviewed are small in terms of both their number of employees and their revenue:
62% have between 1 and 9 employees and 68% have annual revenues of less than $1 million.
The company size results are consistent with the composition of the 2004 Profile Survey, suggesting that any changes that
emerge compared to two years ago cannot be attributed to a difference in survey participants.
There is only one notable difference between this survey and the Profile survey conducted two years ago: In the 2006
survey, the percentage of firms with 100+ employees is 8% vs. the 11% reported in the 2004 report.
2006 Profile Topline Report (June 2006) Page 7
Firm Size: Number of Employees
8%
16%
12% 62%
1-9 10-19 20-99 100+
2006 Profile Topline Report (June 2006) Page 8
Revenue
in 2005
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Less than Between $250K Between $1 Between $2.5 Between $10 $25 Million +
$250K and <$1 Million Million and Million and Million and
<$2.5 Million <$10 Million <$25 Million
2006 Profile Topline Report (June 2006) Page 9
“WHO” WORKS FOR CONTRACTING FIRMS?
About The Survey Respondents
Regardless of company size (number of employees), the survey respondents tend to be at least middle aged. Across the total sample,
59% are between the ages of 35 and 54 and 84% are between the ages of 35 and 64. As noted in 2004, younger contractors do not
appear to be filling the pipeline since such a high proportion of survey respondents are older than 35.
While there are no significant changes between the 2004 and 2006 Profile surveys in the percentage of respondents falling
into each of the age groups, the chart on the next page shows directional evidence that the survey participants may be
trending older between studies. In addition, the mean age of survey respondents is now 49.9, compared with 48.6 two
years ago, which is a significant increase from the earlier study.
2006 Profile Topline Report (June 2006) Page 10
Comparison of Age Composition Over Time
40%
35%
30%
25%
20%
15%
10%
5%
0%
18-24 25-34 35-44 45 -54 55-64 65+
Total (2006) Total (2004)
2006 Profile Topline Report (June 2006) Page 11
Respondent Education
A majority of survey respondents have some college education; this is the case regardless of company size (number of employees).
However, the proportion with a BA degree is significantly higher in firms with 100+ employees (not shown). Regardless of company
size about 3 in 10 survey respondents got their formal training through an Apprenticeship or at Trade or Vocational school.
Compared to two years ago, the proportion with only a High School education declined significantly from 15% to 12% while
the proportion with Apprenticeship, Trade or Vocational School training increased from 25% to 29% (not shown).
Rspondent Education
Total
1-9
BA+
Some College
10-19
Apprentice, Trade, Vocational
HS Only
20-99
100+
0% 5% 10% 15% 20% 25% 30% 35% 40% 45%
2006 Profile Topline Report (June 2006) Page 12
▲“WHAT” TYPES OF WORK DO CONTRACTORS PERFORM?
Types of Work Currently Performed
Respondents were shown a list of 20 project types and asked which their firms performed in 2005. (Note that this list was revised
from the study conducted two years ago.) As shown on the accompanying chart, the project types form a number of tiers: Traditional
Power/Lighting projects were mentioned most frequently -- by more than 95% -- and Alternative Energy were mentioned least often –
by about 15%.
In between are:
Communications Systems/Connectivity, cited by about 70%
CII Automation/Controls Systems, also cited by about 70%
Residential Automation/Controls Systems, cited by about 60%
Power Quality 56%
Some of the differences shown in the chart on the next page may be due to the inclusion of more of different project types within a
different category. For example, the Alternative Energy category now includes ―Geothermal‖ …
However, we believe that the increase from 33% to 62% in the case of the Residential Automation/Controls Systems
category is a real increase since this category arguably covered the same project types: In 2004, the category was listed as
a combination of ―Home Automation, Security and Theaters‖ while the specific project types were listed separately in
2006: ―Whole House Automation; ―Security and Life Safety (Including Fire Alarms and Smoke Detectors)‖ and ―Home
Theater/Sound‖. (However, the three listings were ‗netted‘ so that each respondent is only counted once.)
The higher percentage of electrical contractors that worked on Power Quality projects in 2004 compared to 2006 may have
been due in part to the after-effects of the Blackout that occurred in the summer of 2003.
2006 Profile Topline Report (June 2006) Page 13
Types of Work Performed
In Past Year
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Traditional Communications CII Residential Power Quality Alternative Energy*
Power/Lighting Systems/Connectivity* Automation/Controls* Automation/Controls
Total Sample 2006 Total Sample 2004
* Indicates that the category contained different project types in the 2006 study than in the 2004 study
2006 Profile Topline Report (June 2006) Page 14
Types of Work Currently Performed – By Number of Employees
Project types vary by company size. (Each of the project types is listed only once below)*:
o Firms with 100+ employees are more likely than smaller firms to work on:
o Power (60HZ)
o Ballasts
o Broadband/Wireless
o Solar/Photovoltaic
o Wind Generation
o Fuel Cells
o In addition, firms with 20 or more employees are more likely than smaller firms to work on:
o Lighting Controls (Unique to firms with 20-99 employees)
o Backup Power
o Energy Mgt and Power Quality
o CII (Security/Life Safety including Fire/Smoke Alarms) -- Also includes firms with 10-19 employees
o CII (Security/CCTV/Access/Motion)
o CII (Industrial Controls) – Also includes firms with 10-19 employees
o Structured Wiring/Cabling
o Fiber Optics (Datacom and Lighting)
* Lighting fixtures do not differ by company size
2006 Profile Topline Report (June 2006) Page 15
o Firms with 10-19 employees are uniquely more likely to work on Geothermal projects and on Whole House Automation.
o Firms with 1-9 employees are more likely than firms of any other size to work on only two of the tested project types—
Home Theater/Sound and Residential Security/Life Safety. In fact, while small firms are less likely than larger firms to
work in 13 of the 20 project types, nevertheless, more than one-half (54%) of firms with 1-9 employees work on 8 or more
of the 20 project types.
o Almost 90% of firms with 100 or more employees said that they worked in 8 or more project types compared to 54% of
firms with 1– 9 employees). Overall, more than 90% of the firms interviewed said that they had worked in 4 or more of
the 20 project types. (Not shown).
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2006 Profile Topline Report (June 2006)
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2006 Profile Topline Report (June 2006) Page 17
▲“WHERE DO CONTRACTORS PERFORM THE WORK?”
Number of States In Which Electrical Contracting Works
Fully three in 10 electrical contracting firms perform their work in multiple states, suggesting that there may be issues of licensing and
certification.
Number of States in Which Electrical Contracting Firm Performs Its Work
7%
2%
9%
67% 32%
14%
1 state 5+ states 4 states 3 states 2 states
Not surprisingly, working in multiple states is higher among larger firms:
Total 1-4 5-9 10-19 20-99 100+
Work in 2+ States 32% 20% 27% 38% 47% 77%
2006 Profile Topline Report (June 2006) Page 18
Types of Work: By Sector
On average, the respondents‘ firms are well involved in all construction sectors, although somewhat more of their revenue comes from
New Construction (40%) than from Modernization/ Retrofit or Maintenance/Repair*, which each account for about 30%.
However, as shown below, Maintenance/Repair* plays a greater role to smaller firms (1- 9 employees) while New
Construction plays a proportionally greater role as firm size (number of employees) increases. This is unchanged from the
results reported in 2004.
In addition, Repair accounts for a smaller proportion of total revenue for large firms (11%) compared to small firms (19%).
Types of Work By Sector
2006 Sample
60%
50%
40%
30%
20%
10%
0%
Total 1-9 10-19 20-99 100+
New Construction Modernization/Retrofit Maintenance Repair
* Asked as Maintenance/Service/Repair in 2004. Nevertheless, the combined percents of Maintenance and Repair in 2006 are
comparable to the percents performing M/S/R in 2004. In addition, the percentage that work on New Construction and
Modernization/Retrofit are also comparable to the levels observed in 2004.
2006 Profile Topline Report (June 2006) Page 19
Types of Electrical Projects: Sources of Revenue
Regardless of company size, Electrical/Power Distribution accounts for the largest percent of company sales, by far. Relatively few
statistically significant differences emerge by company size with these exceptions: Security and Life Safety and Power Quality work
each account for a significantly greater percentage of revenue among firms with 100+ employees than among smaller firms.
Although some of the types of work areas were changed between the 2004 and 2006 studies, there are no significant
differences between the two studies on the areas that were asked in both studies.
2006 Profile Topline Report (June 2006) Page 20
Types of Work By Electrical Project
70%
66% 66% 64% 64%
67%
60%
50%
40%
30%
20%
12%
10%
8% 10% 9% 9% 9% 10% 9%
10% 8% 7% 7%
6% 5% 6% 6%
5% 5% 4%
3% 5% 4% 3% 3% 3%
0%
Total 1-9 10-19 20-99 100+
Electrical/Power Distribution Communications/Data Systems
Automated Building Systems/Controls Security/Life Safety Systems
Power Qulaity/Backup Power Sound and Video
2006 Profile Topline Report (June 2006) Page 21
Work in Various Categories (Residential vs. CII and Non-Building)
Across the total sample, electrical contractors get more of their business from CII (Commercial, Industrial, Institutional and Public
Places) than from Residential projects. Non-Building projects (Transportation/Lighting and Utility) account for about 6% of the
contractors‘ business.
However, there are dramatic differences in types of work performed by larger vs. smaller firms. For example, Residential
construction accounts for a much greater proportion of work among smaller electrical contractors (those with 1 – 9
employees), while CII projects account for more of the work of larger electrical contracting firms. In addition, Non-Building
work is much more the province of large than small firms.
There are no meaningful changes between the 2004 and 2006 results. (Not Shown)
Building Categories
80%
70%
60%
Percent
50%
40%
30%
20%
10%
0%
Total 1-9 10-19 20-99 100+
Residential CII Non-Building
CII* = Commercial (Offices, Stores, Hospitality, etc); Institutional (Schools/Hospitals/Stadiums/Parks/Terminal/Cultural/Correctional, etc)
Industrial (Manufacturing Plants/Factories/Warehouses, etc);
Non-Building = Transportation/Lighting (Airport Runway/Highway/Street Lighting including Traffic Controls); Utility (Overhead/Underground Power Line Work)
2006 Profile Topline Report (June 2006) Page 22
Types of Residential and CII Work Performed
Although the greatest portion of electrical contractors‘ revenue comes from CII work, Single Family housing
accounts for the single largest source of revenue. Within the housing category, a higher percentage of revenue comes
from Multi-Family housing with 1-5 stories compared with taller Residential buildings.
Within the broad CII category, a greater percentage of electrical contractors‘ revenue is from Commercial
construction than from Industrial or Institutional projects.
Percentage of Business From Specific Categories
(Total Sample)
40
35
30
25
Percent
20
15
10
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2006 Profile Topline Report (June 2006) Page 23
While Single Family projects account for a high percentage of revenue across the total sample, this type of work is
extremely important to electrical contracting firms with 1-9 employees. On average, these small firms derive almost
one-half of their revenue from Single Family projects.
Electrical contracting firms with 10-99 employees derive the greatest percentage of their revenue from Commercial
projects.
Electrical contracting firms with 100+ employees get a disproportionate percentage of their revenue from Industrial
and Institutional projects and from Non-Building work.
Percentage of Business From Specific Categories
50
45
40
35
Percent
30
25
20
15
10
5
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Total 1-9 10-19 20-99 100+
2006 Profile Topline Report (June 2006) Page 24
▲“HOW” DO CONTRACTORS PERFORM THEIR WORK?
Roles in Specification
Overall, 43% of electrical contractors‘ revenue was done on either a Design/Build and Design/Assist basis. (The vast majority was
done as Design/Build rather than Design/Assist). About 50% of electrical contractors‘ revenue comes from Traditional Bid/Build
projects and about 7% comes from ―other‖ methods of bidding.
Design/Build or Design Assist work accounts for a significantly higher percentage of revenue for electrical contracting firms
with 1-9 employees than for larger electrical contracting firms.
2006 Profile Topline Report (June 2006) Page 25
Percent of Projects Involving This Type of Specification
Categories were revised in 2006
70%
60%
50%
Percent
40%
30%
20%
10%
0%
Total 1-9 10-19 20-99 100+
Design/Build or Assist Traditional Bid/Build Basis Other Basis
↓ ↓ ↓ ↓ ↓
Percent of Projects Involving Design/Build or Design /Assist
50%
40%
30%
20%
10%
0%
Total 1-9 10-19 20-99 100+
Design/Build Basis Design/Assist Basis
2006 Profile Topline Report (June 2006) Page 26
Completeness of Plans and Specifications
More than 20% of electrical contractors that work on Residential projects say that the plans and specs that they receive are
‗less‘ complete than what they were given five years ago; slightly more than one-half say that there is ‗no difference‘ and
about 20% say that the plans and specs are ‗more complete‘.
Among those who work in this area, about 3 in 10 electrical contractors say that the CII plans and specs that they now
receive are ‗less‘ complete than they were five years ago, about 40% say that they are ‗no different‘ and less than 20% say
that they are ‗more‘ complete.
This question was first asked in 2006.
Completeness of Plans and Specs Compared With 5 Years Ago
Among Those Working in Each Area
(Total Sample)
60%
50%
40%
30%
20%
10%
0%
Less Complete No Different More Complete
Single Family Multifamily C/I/I
2006 Profile Topline Report (June 2006) Page 27
Respondents were shown a list of four options and were asked what percent of the specifications that their company receives fall into
each category. On average, a ―single‖ brand is specified only about 20% of the time. In all other cases, other factors -- multiple
brands, ―or equal to‖ or performance specified – come into play. Note that a ―single‖ brand specification is far more common among
electrical contracting firms with 1- 9 employees than among larger firms.
There are no meaningful differences between the results collected in 2006 vs. 2004. (Not shown)
Percent of SpecificationsThat Were…
2006 Survey Results
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Total 1-9 10-19 20-99 100+
Single Brand Multiple Brand "Or Equal To" Peformance Specified
2006 Profile Topline Report (June 2006) Page 28
Respondents were then asked how much discretion they have in making a brand substitution. Overall, contractors are able to make
brand substitutions about 70% of the time.
There are no meaningful differences between the results in 2006 compared with 2004. (Not shown)
Extent of Contractor Influence In Brand Substitution
2006 Survey
80%
70%
60%
50%
40%
30%
20%
10%
0%
Total 1-9 10-19 20-99 100+
Multiple/Equal/Performance Specification (Electrical Contractor/firm successfully makes brand substitution)
Single Brand Specification (Electrical Contractor/firm successfully makes brand substiution)
―Where a ‗single or proprietary‘ specification is indicated, what percentage of the time are you or someone in your firm able to successfully make a
substitution?‖
―Where ‗multiple or equal or performance‘ specification is indicated, what percentage of the time do you or someone in your firm make the brand
decision for installation?‖
2006 Profile Topline Report (June 2006) Page 29
Role of Brand and Manufacturer When Configuring or Working on a Systems
Electrical contractors in the 2006 Profile Survey were asked the following question:
When working on or designing systems where a "Multiple, or Equal, or Performance" specification is indicated, about how
often (as a percent) do you try to stay within a single brand or single manufacturer?
Regardless of company size, 45% of electrical contractors say ―it depends on the situation‖. The remaining 55% differs by company
size: smaller firms are significantly more likely than larger firms to ―try to stay within a single brand‖, while electrical contracting
firms with 10+ employees are more likely than their smaller counterparts to say that they ―try to stay within a single manufacturer‖.
These finding underscore the important role that brand/manufacturer play to electrical contractors.
Percent of Time Electrical Contracting Firm Stays Within a Single Brand or Manufacturer
When Working on Systems
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Total 1-9 10+
Try to Stay Within a Single Brand Try to Stay Within a Single Manufacturer Depends on Situation
2006 Profile Topline Report (June 2006) Page 30
Main Reasons for Brand Selection and Substitution
Original Selection
Availability and Price are the top reasons for original brand selection. Each was chosen by about 70% of electrical contractors as
either their first, second or third reason for initially selecting a brand.
Ease of Installation, Prior Experience, Durability and Manufacturer Reputation form a second tier; each was chosen by about 40% or
more as a top reason for initial brand selection.
Three Main Reasons for Originally Selecting a Brand
80%
70%
60%
50%
40%
30%
20%
10%
0%
Availability Price Ease of Prior Experience Durability Mfr. Reputation Specific Features Word of Mouth
Installation
Selected As Top Reason Selected As Second Reason Selected As Third Reason
2006 Profile Topline Report (June 2006) Page 31
Brand Substitution
Availability and Price are also the top reasons for brand substitution. However, as shown below and on the chart on the next page, in
this case, Availability eclipses Price.
Three Main Reasons for Brand Substitution
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Availability Price Ease of Installation Prior Experience Durability Specific Features Mfr. Reputation Word of Mouth
Top Reason for Substitution Second Reason Third Reason
2006 Profile Topline Report (June 2006) Page 32
Comparison of Main Reasons for Original Brand Selection Vs. Making a Substitution
Availability and Price are even more important as reasons for substituting a brand than for its initial specification. In contrast, Ease of
Installation, Prior Experience, Durability and Manufacturer Reputation assume higher importance – in the original specification --
when time considerations may play less of a factor. In contrast, Specific Features assumes more importance when making a
substitution than in the original specification.
Top Reasons for Originally Selecting a Brand Versus Making a Substitution
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Availability Price Ease of Installation Prior Experience Durability Mfr. Reputation Specific Features Word of Mouth
Originally Selecting Brand Making a Substitution
2006 Profile Topline Report (June 2006) Page 33
Purchase of Materials for Installation
Not surprisingly, Electrical Distributors account for the lion‘s share of installation dollars. Although Warehouse Home Centers are a
distant second, they account for a relatively small percentage of spending by firms with 10 or more employees.
As has been the case in earlier Profile surveys, Warehouse Home Centers account for a significantly larger percent of spending
by firms with 1-9 employees compared to their larger counterparts.
The table below indicates a purchase-source hierarchy:
Electrical contracting firms with more than 10 employees spend a significantly higher percentage of their purchase dollars at
Traditional Electrical Distributors, compared to firms with 1- 9 employees.
Firms with 10 or more employees spend a significantly higher percentage of their purchase dollars buying Direct from the
Manufacturer, compared with smaller electrical contracting firms.
Electrical contractors with 20 or more employees spend a significantly higher percentage of their purchase dollars at
Specialized Low Voltage Distributors, compared with smaller firms.
Average Percent of Dollars Spent at Selected Channels
Total 1-9 10-19 20-99 100+
(787) (496) (90) (128) (62)
Traditional Electrical Distributor 75% - + + +
Warehouse Home Center (Home Depot, Lowe's, etc.) 14% + - - -
Direct from Manufacturer 6% - + + +
Specialized Low Voltage Systems Distributor (Telcom,
Security, Datacom) 5% - + +
+ Significantly larger than other groups at the 90% level of confidence
- Significantly smaller than other groups at the 90% level of confidence
2006 Profile Topline Report (June 2006) Page 34
Almost all of the contractors buy from multiple sources. With the exception of firms with 10-19 employees, the number of channels
utilized increases with firm size. For example, firms with 1- 9 employees are more likely than average to utilize 2 outlets while firms
with 20 –99 or 100+ employees are more likely than average to utilize all 4 of the channels included in this survey. This may be due
to the fact that larger companies are both located in more places – and as shown in an earlier chart, more likely to work in multiple
states -- and are involved in more different types of work.
There are no meaningful changes on this measure from the 2004 Profile Survey.
Average Number of Channels Used for Purchasing Materials for Installation
(Total with Subgroup Differences)
60%
50%
40%
30%
20%
10%
0%
Only 1 Channel 2 Channels 3 Channels All 4 Channels
Total 1-9 10-19 20-99 100+
2006 Profile Topline Report (June 2006) Page 35
▲TRAINING
Training in the next 12 months is taking on increasing importance compared to the past 12 months. As shown below, a directionally
higher percentage of electrical contractors plan on taking training in the next 12 months compared to the past 12 months. *
The focus of the course work is generally similar between the past 12 months and the next 12 months.
However, three topics are of higher interest to those taking training in the next 12 months:
o Datacom and Telecommunications
o Green/Sustainable Technology
In contrast, fewer electrical contractors say that they or a member of their firm will take Safety Training
(Electrical/Personal/On-Site/Job-Site) or training in Grounding/Bonding in the coming year compared to the percent of firms
taking this kind of training in the past 12 months.
* The respondents were divided into groups and 1/3 were asked about training taken by a firm member in the past 12 months and 1/3 were asked about their firm‘s plans for
training over the next 12 months. (The training questions were not asked in earlier studies.) The final 1/3 was asked about professional topics of interest.
2006 Profile Topline Report (June 2006) Page 36
Whether Firm Will Take/Has Taken Training /Courses…
In Next 12 Months In Past 12 Months
Will Take/Has Taken Training 62% 57%
Will Take/Has Taken Training and Answered Question (211) (207)
Main Focus of Course Work
Datacom and Telecommunications ▲ 38% > 24%
Green/Sustainable Technology ▲ 12%> 4.3%
NEC Changes = 75% 73%
Security/Life Safety = 23% 21%
Power Quality = 20% 16%
Estimating/Financial Mgt = 27% 24%
Business Management/Law = 21% 21%
Increasing Productivity = 18% 16%
Sales/Marketing = 15% 12%
Specifications/2004 Master Format Changes = 6.8% 4.3%
LEED Certification = 4.8% 2.8%
Safety (Electrical/ Personal/On-Site/Job-Site) ▼ 48% <58%
Grounding/Bonding ▼ 40% <51%
The differences shown (▼ and ▲) are significant at the 90% confidence level.
