Editor’s Note: This editorial about integrator margin is a preview of the upcoming Editor’s Note in the November/December 2026 edition of CI+SSI.
For today’s integration businesses, being technically adept is table stakes. Whether you’re designing a full-campus AV-over-IP deployment or installing an access control and visitor management system for a corporate headquarters building, you’d better know the architectures, the facts and the data cold.
But what about the data that underpins your integration business? Are you evaluating whether you’re capturing the revenue that your highly skilled labor should command? Are you keeping tabs on which solution areas deliver the highest integrator margins? Are you benchmarking your performance against competitors — and digging into why some contract sizes are harder to close than others? If not, you should be! And D-Tools’ Midyear Market Report offers a Cliff’s Notes version of the variables you should weigh.
Which Integrators are Pulling Ahead Right Now?
I recently dug through the Midyear Market Report, and one thread was unmistakable: The integrators pulling ahead right now aren’t necessarily the busiest ones; instead, they’re the ones who analyze their numbers the way that a CFO would. To prepare you to do that, I’ll walk through some conclusions that the data made plain.
Let’s start with labor. In both pro AV and security, the gathering threat of commoditization is real, but it doesn’t erase value — it just penalizes companies that forget to charge for their most valuable asset. According to the report, labor’s share of contract revenue has crept downward for 18 months, settling at 22.9%. If integrators charged like electricians do, that percentage would set off alarm bells; after all, trades like electrical contracting routinely book roughly two-thirds of a job as labor. But I would submit that they’re onto something: As boxes become cheaper and more interchangeable, expertise is the single line item that a customer can’t source from Amazon or Google Shopping.
My advice? Don’t bundle labor into the hardware quote as an afterthought. Price it, name it and defend it. That’s not a call to raise prices reflexively; rather, it’s a call to make sure that the invoice reflects the expertise that the client’s project required.
Integrator Margin: Is ‘Busy Being Busy’ Enough?
Let’s turn to the “busy being busy” versus “busy being profitable” question. Plenty of integrators are slammed working in categories that move the most volume — for example, audio and video. But, of course, volume and margin aren’t identical metrics. According to the report, the fastest-growing category — lighting and shading — also happens to carry highest margin. By contrast, security and life safety posted impressive growth numbers but sat toward the middle of the pack when it comes to gross margins.
So, what’s the takeaway? Being the busiest integrator in your state isn’t the same as being the most profitable integration business. Chase the categories that reward your time rather than just filling your calendar. Invest sales energy, marketing dollars and staff training accordingly.
Finally, don’t assume the market’s average is your average because here’s the truth: It rarely is. According to the report, a third of integrators grew sales by more than 50% in the first six months of the year; simultaneously, another third saw sales decline by more than 20%. (The remaining third fell in the wide chasm that represents the middle of that bimodal distribution.)
According to the report, the segment facing the most challenges also sits in the middle — namely, contracts in the range of $25,000 to $50,000. Amid ongoing macroeconomic struggles, persistently high consumer costs and interest rates on an upward trajectory, this scale of investment has become a pain point for many clients. A possibly winning strategy for integrators? Break the scope into phased, smaller contracts. This is not only a sales tactic but, indeed, a coherent business response to a market in which mid-sized commitments may be hardest to close.
Technical Fluency Brings Enduring Value
Every CI+SSI reader knows that a CTS, for example, opens doors — and it should. Technical fluency brings enduring value. But the data makes a parallel case just as forcefully: The integrators who separate themselves from the pack next year will be the ones who know their own numbers as cold as they know signal-distribution architectures.
Integrator margin lives in the labor you choose to price, the categories you choose to chase and the segment of the market you decide to compete in. Credentials and certs may get you in the room, but it’s knowing your data that keeps your business profitable.
