Custom Installer Tricks of the Trade – How Dealers Maximize Profits While Minimizing Your System

April 21st, 2011 · 17 Comments · 3D HDTV, Connected TVs, LCD Flat Panel, LED LCD Flat Panels, News, Plasma, Reference Materials

A home theater is a wonderful thing. A big, bright HDTV screen, five or more channels of clean, clear dynamic surround sound and remote control to drive it all. Completing the package, ideally, all the wires are hidden within the walls. This is what people want, but few have the product knowledge or carpentry skills to get the job done right. Enter the custom installers to bring it all together.

Many custom installers and A/V dealers do fabulous work. However, you should not forget it is a business and in the “free market” the goal is always to maximize profits.

Unfortunately, the best interest of the consumer may conflict with the dealer’s business goals. A number of companies simply want to get consumers to pay the most money possible for the job and get out as quickly as possible maximizing profits.

To learn the tricks of the trade we interviewed Bruce Clark, president of Long Island based Audio Breakthroughs. They’ve been in business for over thirty five years and have installed thousands of home theaters. Occasionally Clark receives calls from other company’s dissatisfied customers requesting fixes for a botched installation.

Here are a number of “tricks” he’s seen used in these bad jobs, so you know what to look out for.


In-Ceiling Speakers in Lieu of Enclosure Type

The most important speakers in any home theater are the front speakers (left, right and center). These produce the vast majority of the sound plus all the dialog. Rear speakers are generally only used for occasional sound effects.  While placing speakers in the ceiling is fine for background music, you want the dialog to be clear and seem to be emanating from the display. Ceiling mounting moves the sound  above the screen, creating a disconnect by making the actor’s voice appear to come from above rather than from the screen. So why do custom installers recommend ceiling speakers?  Clark explains that in-wall and in-ceiling speakers have the highest gross profit margins, ranging from 60% to 90%. In other words, if the pair of speakers costs you $500, that could be $450 in gross profit for the installer. The in-wall speaker manufacturers have very controlled sales distribution; it is highly unlikely to find the product at a good discount on-line.

Clark added, their use of in-wall or in ceiling speakers in a home theater is done only as a last resort to satisfy customer’s demands.

Enclosed speakers have better dynamics and a much more even frequency response. This is because  the drivers and enclosure are tuned as a complete system.

Component Video Cables Instead of HDMI

Component video cables are analog connections using three RCA-type cables. They have red blue and green ends. This system was adopted for home use with the introduction of DVD players back in 1997. Analog component cables over long runs can lose high frequency information, seen as fine picture detail. Long component cables always produce an image, but it can be soft.  HDMI is digital and therefore maintains all fine picture detail (our  test of 50 foot cables).

But, HDMI doesn’t always work, at least not as easily as analog component. HDMI cables require dealer know-how to assure at the needed length works properly with a given system. To save  effort, many custom installers still use the obsolete component video connection. Some incorporate it as a back-up with an HDMI cable (in the very unlikely case of cable failure), however many simply run component video solo. How can the customer know the picture lacks fine detail when they have no point of comparison? They can’t.  Ignorance is indeed bliss. Clark says his installers always uses HDMI as the connection, as it provides the best image quality and transfers the best audio codecs along with it.

Flat Panel Mounting

There are two types of flat panels, LCD (includes LED LCD) and plasma. The former needs to be at or near eye level for optimum image quality. This is due to LCD’s limited vertical dispersion (with many models). If eye level isn’t possible, they’ll need to be tilted down towards the viewer Plasmas have excellent vertical and horizontal dispersion and as such can be mounted flat on the wall without any significant losses in picture quality. Clark explains that ultra-thin TVs look best when paired with wall mounts designed for thin panels. Pivoting mounts make the panel stick much further out from the wall, and are unnecessary for many installations.

To the dealer this means inventorying many different model brackets to provide the ideal mount for a given job. Clark states many installers use fat, pivoting mounts in a one-size-fits-all strategy to save inventory costs. Most TV buyers don’t know what they need, let alone what’s available, so the custom dealers take advantage by selling what they want to sell rather than what best suits the customer’s needs.

Another reason installers use mounts that stick far out from the wall, the TV’s power cord plug. The plug end necessitates a space between the wall outlet and the mount. For this reason, Clark provides customers’ electricians with recessed outlets to install in place of the standard flush-mounted units.

Selling the Customer Back Cables

HDTV  components such as Blu-ray players often  come with  av cables. Rather than use them as needed and save the customer money, some dealers enhance income by selling the consumer back the same cable that was already in the box. Nothing beats a 100% profit.

Wires-One Sizes Fits All

Category 5 and Category 6 cables are used for Ethernet connections and other digital signals. Clark notes his crews fix bad installations where Cat 5 was used for nearly everything, including speaker wire. Like component video, using any wire with an analog audio signal will produce sound, but the single, thin twisted pairs in Cat 5 and Cat 6 cables do a terrible job of preserving analog audio fidelity.

Clark says his crews use at least a 14-gauge speaker wire for all their installations.

Home Automation

Touch screen home automation systems, such as what Crestron offers, can make controlling a home theater a breeze. These sophisticated systems require specific programming, which often costs thousands of dollars on top of the cost of the automation hardware itself. What consumers aren’t aware is the “source code” for the program is unique for their system. To replace a component in the future (a new Blu-ray player, say), the program needs to be modified to accommodate the new equipment. The question is, where’s the source code for the system? If the consumer doesn’t have the code, they are at the mercy of the installation company, and they can charge whatever they want to upgrade your system. Worse, what if the company goes out of business? Then the consumer has to pay another programmer to program the entire system from scratch (incurring yet another multi-thousand dollar bill)

If the consumer has the source code, any Crestron programmer will be able to make the changes and the programming charges will be limited to the one component. Make certain you get a copy of the source code program from the installer. A number of dealers refuse to provide it and these firms should be avoided. It’s a smart idea to get this written into the contract. Here is a link from an excellent article by CE Pro that expands on this issue.

 

Get The Model Numbers

When you get a system price from a custom installer it should include an itemized product list with  all make/model numbers. A number of dealers don’t provide this information. For example, Sonance (a speaker manufacturer) sells over 180 models that range from $200 per pair to $3000 per pair retail.  Dealers may state they don’t list specifics product numbers because models tend to change. Be aware, without  model numbers you won’t know what you purchasing and may not get what you thought.

 

Too summarize, a home theater proposal from a reputable company should include all product model numbers, HDMI connections from all high definition sources, proper gauge copper speaker wire for speaker connection, shielded audio cable (where required), enclosure type speakers for the best front and center sound quality and a provision for all source codes for any home automation remote controls systems that require written programs.

 

 

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17 Comments so far ↓

  • R. Johnson

    Unlike many of the comments posted so far I would like to thank HD Guru and Bruce Clark for the article. By far I believe the article serves to inform and educate competent consumers in a positive way by exposing some of the pitfalls and problems that can occur under certain circumstances when hiring a custom installer or A/V dealer that is less-than-scrupulous or outright incompetent. Though confined to a relatively small percentage (after all the article did say “occasionally,”) such installers are clearly working in the industry creating not only problems for consumers but also for the reputation of the custom installation industry, which includes many competent, conscientious installers and A/V dealers dedicated to customer service. I also believe knowledge has the ability to empower any consumer who is sufficiently temperate and open-minded. I would also like to point out that I have no problem whatsoever with a dealer or installer attempting to maximize profits as long as it is done in an ethical manner and without resorting to blatant (or persistent) price-gouging; the latter of which can be greatly minimized by an effective bidding process.

    The use if in-wall—and somewhat less so in-ceiling—loudspeakers is not as simple or clear-cut as some would like to believe. Personally, excluding a dedicated stereo or 5.1-channel “audiophile” music system where the source material would be considered “purist” in nature and/or where the consumer is prone to regular loudspeaker upgrades, I have no problem recommending or installing well-designed in-wall or on-wall loudspeaker systems; subwoofers can be much more problematic, especially when it comes to consumers who prefer ‘heard but not seen.’ The circumstances under which I would recommend or install in-ceiling loudspeakers would be extremely rare though definitely not zero.

    My experience is that is not that difficult to achieve reliable and effect digital A/V connections—I always test the connections prior to installation—and therefore I have yet to resort to bundled RGB coax and analog connections.

    Never would I use anything other than proper speaker cabling when connecting audio power amplifiers to loudspeakers – period!
     

  • Joe Reader

    “the single, thin twisted pairs in Cat 5 and Cat 6 cables do a terrible job of preserving analog audio fidelity.”

    I just have to laugh at the expert opinions of ‘audiophiles’. Do you understand what Cat 5 and Cat 6 are categorizing? They are carefully designed to carry RF signals up into the 100’s of MHz range. Any you think they somehow don’t have the ‘fidelity’ to deal with audio frequencies? Get real. The only legitimate problem LAN cable would have with audio is power handling, and that is based solely on the size of the wire.

  • Jim e. Ross

    The tone and point of this article gets lost in its mean-spiritedness. HG Guru, you prove this point by attacking the people commenting – but only certain people. Rob on Apr 22 made great points and you completely ignore what was said. You didnt even respond. Then you bash Rob (is it the same rob?) on Apr 27 for a blank testimonial page. The feedback on this article seems pretty poor, i guess you have the guts to leave this up. Big question – what are your credentials to back YOUR work up? There are obvious factual errors AND spelling mistakes in this article, that reads at about a grade seven level. Can i see a high school diploma please?

    Rather than asking for my diploma,why don’t you use your time replacing Cat 5 “speaker wires” with 14 gauge stranded copper.

    HD Guru

  • Paul

    “HDTV components such as Blu-ray players come with a/v analog cables. We updated the copy for clarity. Thanks for the catch.

    HD Guru”

    You should always avoid using the cables in the box, especially AV cables. They do not come with HDMI Cables which is the only way to get the best performance of your TV.

  • HiFiFun

    I know what its like too, to tell the truth and take a lot of heat for it.
    Installer interest in maximizing his profit in the shortest possible time (without free callbacks) at the name of the game.
    Never buy any computing device where you do not have root or administrator control. I use htpc’s with gigabit Ethernet between the rooms. It all works and will never be obsolete. You don’t need an installer to buy a pc!

  • Rob

    If you call yourself an HD Guru you shouldn’t have needed a retailer/installation company to tell you these obvious flaws of inferior installers. You should have been able to write this article off the cuff as a courtesy to your readers. Seems every comment is in agreement of your article’s flaws.

    We use qualified sources for our articles and stand behind our content. Perhaps you and your fellow installers at “home theatre” companies should spend more time educating your customers and less trying to shoot the messenger with your lame comments.

    In other professions i.e. electricians and plumbers there are good honest companies and there are also bad players. However, unlike those other trades, in our municipality (and many others) any idiot with a sawzall and a checkbook can call themselves a “Custom Installer”. There are no license requirements that set minimum standards of knowledge and training for custom home theater sales and installations.

    Buyer education and references allow the dedicated AV guys to compete against the alarm guys, wiring guys, building contractors and other industries that claim to be “Customer Installers” .

    We checked your company’s testimonial page and noticed it is blank. Why not take your own bad advice and write them up yourself, off the cuff as a “courtesy” to potential clients.

    HD Guru

  • David C.

    What are you talking about regarding in-ceiling speakers and in-ceiling LCRs? There are dozens of choices for in-ceiling, high-performance LCRs- many with properly tuned enclosures. Many times these are specified by the designer, sometimes these are dictated by the room itself and it’s options for speaker placement. This article contains opinions and vague generalities, not real facts. Most boxed, free-standing speakers from premium manufacturers also have a dealer profit margin in the area of 60-70%. Without the margins made on speakers, mounts, and accessories, nobody could survive as a custom installer.

  • FunHouse Media

    Dear Readers of this Blog-
    While any trade has good and bad representation- please do not let this article create ill-will towards those that do make a living providing superior expertise, service and installation.
    Focus on finding a dedicated AV installer; not an alarm company or electrician that also does AV on the side, or a handyman. I encourage my customers to educate them selves and get 2-3 quotes for the work I am being asked to do. Also ask for referrals and check online review sites. The “bad” guys generally do not last very long and the “good” guys will outlast anyone (big box stores included).
    I take pride in the work I do and what I bring to the table for my customers. Yes, I do charge more than others with less experience but I have never had a complaint I could not resolve to the customers’ complete satisfaction.
    Don’t be taken advantage of, do your homework get referrals and ask questions and you are less likely to be faced with the kinds of people listed in the article.

    We concur with your advice regarding customer education, and that was the intent of this article.

    HD Guru

  • chuck daly

    This article should be deleted. As it is currently written, it will only cause consumers to antagonize otherwise honest installers. The errors in the artcle have stated above by others.

    We stand behind our content. These are not errors, though some comments are stating specific things that are not in the article i.e.connecting a Blu-ray player via composite.

    Regarding in-wall speakers, in addition to Mr. Clark’s comments, we shopped a Magnolia within a Best Buy for a 5.1 home theater system and a flat screen with a $10K budget. Without stating any objections to enclosure speakers, the salesperson recommended five in-ceiling Speakercraft speakers and put in in the proposal.

    HD Guru

  • Alan Poltrack

    Are you at a loss of things to write in your article? I’ve been in the custom installation business since 1983 and can say that all of the serious integration companies I know are reputable and that’s how they stay in business. I seriously can’t believe that any professional would install a BluRay player using the analog composite video and stereo patch cable that may come in the box just to screw his customer. Perhaps a home owner who doesn’t know better could hook up a BluRay Player using these cables but not a Professional.

    In-wall and In-Ceiling speakers have been around since the 80’s. I remember people knocking them and saying they won’t take off. Well guess what they did.
    Not all in-wall speakers are equal. Some are really cheap and some are well built with back box enclosures. The reality is many designer and customers demand them. Now we are even selling invisible speakers like Stealth Acoustics. The customers LOVE them. There is no doubt that dollar for dollar you can get a better sounding free standing speaker then most in-walls but I find it hard to convince many homeowners to put free standing speakers in dining room’s, Kitchen’s, formal living rooms and so on.
    Yes we sell in-wall speakers and thank god speakers in general still have some profit left in them.

    It’s obviously to me that you don’t know what you’re talking about.
    The bottom line is as a professional I LOST ALL Respect for you.

  • Michael

    Wow you hit a nerve here apparently! Haters gonna hate! I liked the article a lot.

  • Steve Faber

    Gary,

    Way to shoot an entire industry right in the head. I’ll remember that I’m really out screwing my customer the next time I’m out away from my kids until 7:30 at night to take care of a customers problem with no additional compensation. Some custom installation professionals really do have integrity, and design their systems based upon their customer’s requirements, not yours or mine. If all professionals are influenced primarily by financial considerations and let those influence their work to an inordinate extent, does this not also extend to writing professionals?

    To address some of your issues:

    1) In-wall / ceiling speakers – We always tell customers right up front that they’ll get far more sound quality for their dollar with an enclosed speaker. Some customers heed our recommendations in this area. Unfortunately, from a sound quality perspective, most do not.

    What you have to realize however, is that this is not an audio / video profession, it is a lifestyle one. As has been mentioned, customers often make choices based more on aesthetic concerns, rather than sound quality ones. For a purist, that’s too bad, but for the person who’s just spent $150,000 for an interior designer, there are other considerations besides how their system sounds when it’s finished.

    Regarding in-ceiling LCRs – Properly implemented, they sound better than you’d expect, but that’s not the main reason that installers use them. Sure, aesthetics are definitely one reason, but another that you probably failed to realize is that often there is no place for a front speaker complement. It’s true. We’re often dealing with flat panels mounted above a fireplace, surrounded by ornate woodwork, stone, or other impediments to proper speaker placement. On other occasions,, there simply isn’t the room.

    Yes, you can use any of the fine speaker mounting solutions available to mount speakers to the sides of the TV. That was well and good when TVs were 3 or 4 in thick and if there is sufficient width to accommodate speakers to the sides of the TV.

    2) HDMI can, indeed be the devil, but thankfully most of us have worked beyond it’s troubles now. Selling component isn’t always the installer’s choice. Sometimes it is the customer who decides. When faced with the prospect of dropping $15,000 – $25,000 on a Crestron HDMI digital media system, when they could do the same job for ¼ that by using component, some customers simply decide to live with the impending obsolescence, reasoning that, in time, reliable HDMI distribution systems will experience dramatic price reductions, as have many other consumer electronics categories.
    3) Ditto for a display located a long distance from a source component. A client’s secondary TV located above their bar or on a wall mount in their exercise room can often be a considerable distance form the source. At a time when a nice 32” set is only about $450 – $500, few clients want to pay almost that much for an HDMI over CAT-6 or RG-6 extender to feed it. For such an application, they’ll happily settle for a component feed.

    4) In my experience, most custom installers don’t inventory many mounts. They don’t have to, when there are several distributors ready and willing to supply them at a moments notice. Most of us have ample knowledge of an upcoming job, so we have plenty of time to get the proper mount, without inventorying a shelf full of them.

    5) Cables – In 20 years designing, installing and programming custom audio video systems, I’ve yet to sell a customer back their own cables, or considered such an action. On the contrary, it’s more often the case that I’ll throw in a set of cables for a good customer, not over charge him for some.

    Thanks for the article!

  • Rob

    Wow! Way to just slam my industry, “HD Guru.” You interviewed ONE A/V installation company who relayed his observations of OTHER A/V companies’ work. Couldn’t you have changed the tone of this article and, especially, the headline to more accurately reflect that? Something along the lines of, “Reflections of botched installs”? And then point out that these are specific individual instances? I got news for you:

    1. Clients ASK for in-wall speakers. All the time. People really don’t like to SEE speakers. And they still, mistakenly, think that tiny little cubes sound good. In-wall speakers sound good and blend into the decor. Try painting a free standing speaker. Go ahead, try it.

    2. HDMI HAS been a nightmare to implement. And quality companies have risen to the challenge. But for many clients that meant time and money. Not every client has the patience or checkbook to deal with the hurdles that HDMI can present. And what if the house was wired years ago with component and the client isn’t interested in remodeling?

    3. If anybody resells the cables that come in the box, they should be shot. We sell aftermarket high performance cables that make a difference in a client’s system. As Robb pointed out, the cables in the box are garbage. They’re called “courtesy” cables for a reason. Manufacturers don’t actually expect end users to use those cables for any length of time. They’re meant to get-you-by until proper cables are installed. If the project is installed properly, the included cables are never used.

    I agree with you on transparency and far more of us are than you think.

    Please try to do a little more homework next time.

  • Peter Radsliff

    My two cents: most of the cables that come with ANY component are completely crap. I would never consider using them when I have gone to the extent of building a quality home theater. I’m not an advocate for spending ridiculous amount on cable, either. But people should know that you get what you pay for, and when the cables are free, that’s what they’re worth.

    Typically what is supplied by the component maker are 3-6 ft analog audio/composite video cable. For standard definition composite video and stereo audio (i.e VCR, remember those or SD cable box) it should work just fine. I have no problem with the installer recommending, selling and installing a higher quality cable, its the
    selling of the free (included) one back to the customer.

    HD Guru

  • Ken Briggs, CPD

    As there a many different grades of doctors, lawyers, hairstylists, auto mechanics there are electronic systems technicians. All your readers need to know is to locate one that is licensed by the state (to eliminate the possibility of hiring a felon) and one that is established and can qualify to become a member of a industry association like CEDIA. That will eliminate start-up firms, shade tree technicians/trunk slammers, un licensed companies and companies who just dabble in a/v like electrician, telecom, security and other what appear to be similar but have nothing to do with a/v industries. As the problems you and your source mentioned often and almost exclusively arise from unqualified firms.

  • Robb Criminger

    HD components may indeed come with cables. However, they are often of a very poor quality. Direct TV will provide the client with an HDMI cable, and I inform the client of this, but I also let them know that it is a flimsy, cheap, FREE version and for only a few extra bucks, they can get a quality cable to install in its wake.

  • Ricky Bobby

    “Selling the Customer Back Cables

    “components come with a few cables. ”

    TV’s don’t come with any cables in the box chief. Unless you mean a power cable.

    HDTV components such as Blu-ray players come with a/v analog cables. We updated the copy for clarity. Thanks for the catch.

    HD Guru

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