They say sometimes the first step is the hardest one to take, but in the case of getting started in a new category like lighting fixtures, that first step can be a baby step.
So how do you get started? Integrators offered some sage advice, including starting with small retrofit projects or landscape lighting, before taking the leap to add high-voltage electrical service or full-fledged lighting design to your business. However a CE pro company tackles lighting, and getting educated is vital.
Here are 11 steps to get started in lighting.
Learn the Lingo of Selling Lighting Fixtures
Drew Ballsman, owner of HD Media Systems in Jackson, Mo., dove into lighting several years ago following the lead of HTSA. Ballsman says the first step is to understand the lingo.
“I think getting a baseline of knowledge so you can talk knowledgeably on a job site to an architect, to a builder, or to a designer is probably the key thing to do. You’ve got to know the lingo. You’ve got to talk the talk, you’ve got to know what it is. You’ve got to demystify some of it. It’s a lot like audio in that audio tends to want to be overly complicated so that makes it scary to a lot of people.
“Getting some baseline information was huge. Then trying to reach out to partners can be extremely helpful in getting you started. When you are getting into the lighting space, you don’t know the SKUs, you don’t know the product mix, don’t know the lineups. It’s just overwhelming at first.”
Lean on the Vendors; Create a Matrix of Products
Ballsman says he leaned on his vendors a lot at the outset.
“I would ask, ‘What is this? What am I looking at? How does this go together? That was critical,” he recalls.
From there, HD Media Systems created a lighting matrix chart that covered all the SKUs and the price points. “That helped us define the starting points,” he says.
Jonathan Wesco, president of Allegro in Mishawaka, Ind., started in lighting fixtures back in 2014, so he has been through the experience of what it takes to establish your company in the space. The difference between now and eight years ago, he says, is the increased manufacturer support for the custom integration channel.
“In about 2014, back when Ketra was still independent, we had the notion that at some point in the future we were going to see controls move into the lighting fixture itself. We realized then that if we’re not in the fixtures business, where’s our controls business going to go? We saw the need to diversify and actually began learning the lighting business so that we could be selling lighting fixtures,” he recalls.
But it wasn’t easy. Wesco remembers going to Lightfair and taking a three-day training course, but still having trouble getting fixture manufacturers to sell to him.
“Today, we’ve got manufacturers that have identified our channel as their future to be able to sell a luxury product. The groundwork has been laid. You can easily create a portfolio of products that allows you to meet the needs of a really good lighting design,” he adds.
Get Lots of Manufacturer Samples
Another key step taken by HD Media Systems was to obtain as many samples from manufacturers as it could.
“We wanted to see what we liked and what we didn’t like. Looking only at the literature and reading the specs is helpful, but you still don’t know if you like something until you see the fixtures and how they compare to other things and different applications. Getting those samples is a huge deal, especially with higher-end fixtures it is important,” Ballsman says.
“The samples have helped us close sales to have those samples on the table. When you’re asking for a couple of hundred bucks per fixture, it helps if they can hold that and feel the fit and finish. It sounds silly, but it does have an impact on a client as far as understanding what they’re paying for. Price is an obstacle for a lot of people; they don’t understand how a hole in a ceiling can range from $75 to hundreds of dollars. The samples help people understand.”
Think to the Future, Not the Present
One of the biggest inhibiting factors to many integrators jumping into lighting is business is so good right now, why should they look at a new category of equipment? The resources needed to figure out lighting would be time, energy, and money taken away from existing product categories that are doing well.
But, according to Wesco, that thinking is short-sighted.
“If you can figure out this category now when times are good, then when times are bad and everyone else is suddenly looking for a new opportunity, you will have already positioned yourself far out in front of your competitors,” he says.
Pick a Lighting Champion
As with any new category of equipment, getting your internal team excited about it is important. At GHT, Eric Joy uses DMF Lighting. To familiarize the GHT team with the product, he had everyone pick a room in their home and install some downlights.
“They’re very easy to do. You can swap out your whole kitchen in less than 10 minutes,” he notes.
That simple task was helpful in getting the team onboard.
Also, Mike Libman, national sales director of residential systems at DMF Lighting, advises designating an internal “champion” who can do the legwork investigating the various brands, taking all the training possible, and then working with the vendors and the rest of the team to educate the staff.
“When there’s someone that’s a champion for a brand or a category, it’s the fastest way to have that spread throughout your team and get some wins under your belt,” he says.
Focus on Retrofit Projects First
Wesco recommends dealers not start out on large, new construction projects to test their lighting fixtures chops.
“Go into a customer’s home that you’re already working with and retrofit the house to new LEDs using DMF Lighting. If you’re on more of a budget or the client is on a budget use Soraa [lamps]. You can literally go in and re-lamp the house and it’s a really easy sale. You don’t need to know much in order to be able to do that. You can create some significant revenue doing that with literally your lowest skilled folks on staff,” he says.
Libman agrees, saying it is “huge” for CE pros embrace the retrofit category as an entry point for lighting.
“If you’re doing a lighting control retrofit on a project and you are updating a touchpanel, on 100% of those jobs you should be pairing it up with light fixtures. It’s no longer about doing lighting controls independently,” he says. “It’s that solution experience. If you want to provide quality lighting and controls in the same bucket, you don’t need to have an electrical contractor on staff. You can actually go in with your crew and swap out fixtures.
“We’ve seen it a lot where dealers get a $20,000 PO or more on a retrofit project. It’s immediate revenue,” he adds. “If your initial step getting into lighting is targeting a large, new construction project, that’s going to take two years to supply, and it’s going to be harder for your salespeople to see the commissions and embrace the category. Doing retrofit lighting is the fastest way to see revenue, it’s the least amount of risk, and it’s the simplest logistically.”
Richard Millson of Millson Home Technologies in Vancouver, Canada, echoes that sentiment.
“Start small. Don’t jump in big. If you make a mistake on a multimillion-dollar home, it’s going to be very problematic for you and your business. Build up over time. If you can’t afford a showroom, look at demo kits, but start small and build. I think this is probably the biggest thing that’s come along our industry in maybe 25 years. It’s enormous. I can actually see some integrators that are currently doing all technologies migrating into only doing lighting,” says Millson.
Incorporate Linear Tape Lighting
So many dealers want to focus on the can light, but they forget about linear tape lighting. Asking clients about under-cabinet and toe-kick lights is tailor-made for selling linear LEDs. Early adopter integrators use linear lighting in the usual places like under kitchen cabinets and in-ceiling coves.
“When you ask the lady of the house about under-cabinet and toe-kick lighting, you will literally see a smile come across her face. She will light up. Linear lighting really isn’t that complicated. It’s a little more involved, but it’s something that’s manageable to learn,” notes Allegro’s Wesco. Allegro’s go-to brands are Proluxe from American Lighting, and Colorbeam using a driver for a Savant control system.
Jennifer Kirkpatrick, national sales manager, residential, for American Lighting, says, “With linear lighting, there are so many different spaces you can light linear with — it’s low-voltage, the dealers are already very familiar with low-voltage. I almost call it a stepping stone in getting into the lighting fixture game.”
Leave Decorative Lighting for Designers
“Decorative lighting is the ‘jewelry’ added to the architecture, like rings, watches, and necklaces on a person,” describes Glenn Merlin Johnson of Adaptive Design Group, a Park City, Utah-based lighting design and engineering firm. “The decorative fixtures are not necessarily meant for room illumination, but are ‘props’ that are critical to the look and feel of the space.”
Examples could be pendant fixtures, side-table and back-table lamps for reading. In some cases, they can be integrated with dimmable floor receptacles.
The temptation to start selling $12,000 chandeliers is great, but integrators who are into lighting already advise leaving that to the interior designer, while at the same time making sure they select decorative fixtures that are controllable and compatible with the lighting controls.
Moreover, leaving the decorative category to designers is a strong signal of partnership that will help integrators not alienate designers who might want to be more involved in the lighting decisions.
Do Outdoor Landscape Lighting
According to Patrick Laidlaw, director of business development at AiSPiRE, the integrator-channel-centric fixture brand from WAC Lighting, landscape lighting is another “safe” way for dealers to dip their toes into the lighting market. There is much less pressure regarding lighting placements and wire runs that an integrator will encounter inside the home. Landscape lighting is simpler to install than interior lighting, and can be a slam dunk sale using a starter kit from one of the manufacturers like Coastal Source or Garden Light LED.
Wesco at Allegro adds, “You literally will start popping in $20,000 to $80,000 landscape lighting packages. Between Coastal Source and WAC you have a beautiful mix of products, and you can create a serious category.”
Get Lighting Design Training or Hire a Designer
With lighting design and engineering firms like Light Can Help You and Adaptive Design Group available to assist integrators with full documentation plans and layered lighting design, when is the time to pull the trigger and hire your own on-staff lighting designer or get your staff certified by the American Lighting Association?
The various buying groups have been working closely with the ALA to offer access to their courses, but taking a few lighting design courses does not suddenly give you the same skills that a veteran lighting designer possesses. Moreover, manufacturers offer design services in many instances.
According to Libman at DMF, one of the biggest stumbling blocks he sees among integrators is they want to wait until they are the ultimate experts before getting started in lighting.
“You definitely need to have a baseline understanding and know what you’re talking about, but there is an awesome support network that wasn’t around five years ago. Designers such as Light Can Help You do outsource design for integrators. These guys are fantastic. They know what they’re talking about. They understand your business model,” he says, adding that manufacturers such as DMF offer their own lighting design assistance for dealers.
Wesco at Allegro says hiring an internal lighting designer is a big commitment.
“We’ve run the numbers to determine at what point would we need to bring a lighting designer in, and we’re estimating that it would be somewhere in the neighborhood of at least 20 projects a year,” he says. “If you have less than 20 projects a year, you really have no business looking to hire a lighting designer. It’s going to be an enormous investment. That lighting designer is probably going to be green. He’s probably not going to be necessarily a processes guy, which is really what you need to develop your strategy.”
Wesco uses Light Can Help You to design his projects and often doubles the number of electrical loads on a project after arranging for a joint 20-minute Zoom call with the client and the lighting design firm’s David Warfel and Mark Langston.
“We close eight out of 10 projects that I get on the phone with them, taking projects with a $20,000 lighting controls package to $40,000. Then, when we start selling lighting fixtures, that adds another $40,000. So we can grow that $20,000 project to $80,000 using a lighting designer,” he remarks.
Instead of investing in in-house lighting designers, Wesco recommends dealers look to hire an engineering/accounting person that can manage all of the parts and pieces of a lighting design and execution.
“Preferably someone that has enough people skills to engage the electrician and work with the different parties involved and bring the full execution of the project together. That would be the first hire in my opinion. That’s what we did. We hired an engineer fresh out of school. Anytime our sales guys have a project, if it’s a retrofit scenario, they literally do a debrief with him and he does the full bill of material,” says Wesco.
Step 11: Do You Need to Be an Electrician to Succeed in Selling Lighting?
The biggest question regarding lighting fixtures is whether a low-voltage integrator needs to hire an electrical contractor to be part of his team, or simply partner with local electricians? The answer is up for debate.
According to DMF’s Libman, “You do not need to have an electrical license to do this. You can buy the fixtures and still have an electrician do the panel and the labor. You spec the product and buy the product.”
Andrew Davis, CEO at Gramophone, disagrees somewhat. He sees the move into lighting as an ideal situation for dealers to expand into electrical contracting.
“The best advice I can give is to find a local electrician that you work well with. Maybe someone who has a smaller operation that may be great at what they do, but not like the business side of it in terms of paperwork, marketing, showroom, and see if you can get your arms around that individual and bring them in-house.
“We all know a good electrician who’s not a good business person, right? We’ve all run into those trades, where they’re like, they’re amazing carpenters, and they can’t run a business to save their lives.”
“I completely agree with what Andrew was saying,” says Millson. “The best way to do this right off the bat is to take it in stages. Just don’t go out and start hiring electricians. You could just form your own division and all that sort of thing. There’s a fair amount to it. By taking in steps, you can learn as you go.”
Millson works closely with a local electrician but recognizes that someday he might become part of the company officially.
At GHT, the company has started its own electrical division for one of its locations, but not in the city of St. Louis.
“St. Louis is a pretty union-heavy town so we’ve decided to hold off on that for now because it definitely complicates things; but in Atlanta, the company has hired a master electrician.
“It’s made a huge impact because it makes it so much easier to sell control, fixtures, electrical and services in a package. It’s easier on project managers; it’s easier to manage everything across the board if you have that extra level of control,” remarks Joy. “Yes, we’ve made the investment in hiring personnel and getting the electrical license. That’s a big step, it took us a while to decide to do that but it has made a lot of sense and definitely is worth doing for us.”
Ballsman of HD Media Systems suggests that even though many integrators are adding electrical divisions, taking away the labor from the electrician can cause channel conflict. He thinks the integrators should focus on the quality lighting design, supplying the product, and being consultative to the other trades while letting the electrician do the installation so he can continue to capture the labor as his primary revenue source.
Wesco believes you can be successful in lighting without hiring an electrician, but he worries a bit about the long-term situation of integrators working so closely with electricians.
“One of our concerns is we’re literally working side by side on these projects and the electricians, which are ultimately our competitors, are observing our process and what we’re doing. That’s a little concerning to me as a business owner. We’ll have to work through that over the course of time. I see, eventually, probably having some electrical division but it would probably be very different than what a traditional electrical contractor would be,” he notes.
Lee Travis, owner of Wipliance with offices in Bellevue, Wash., and Scottsdale, Ariz., has been doing electrical work for 15 years in Seattle, but only work that comes associated with the low-voltage space. In other words, Wipliance electricians are not out there making service calls on electrical panels for new customers.
“With our electrical business in Seattle, we’re really geared toward the boutique projects. What we mean by that is we do a lot of really cool lighting and a lot of really high margins. That’s what we’re interested in,” he says frankly. “Everything else, we’re trying to send to other electricians … to the builder’s electricians.”
Wipliance’s Scottsdale location does not do line-voltage work because Travis is trying to work closely with electrical contractors as partners there. The large projects there can have up to 300 openings (switches, fixtures, etc.), which can mean big labor revenue for the electricians.
“Electricians think about labor openings, it’s what they do. They think about that before the product. They’re making 25%, let’s say, on the fixtures that they pick up from the supply house.
“They might make $2,500 in profit for $10,000 fixtures, but we’re going to come in and do $100,000 in fixtures. So, if their break-even point is $25,000 on that, we might give them up to 10%, and they can just be hands-off. We’re going to take all this design headache off their hands and we’re going to spec and provide all the fixtures, and we’re going to drive up all the electrician’s labor costs because of all the additional openings that we’re going to have,” explains Travis.
Robert Haecker, president and founder of TRIPhase Technology in Zionsville, Ind., does not have in-house electricians.
“Our approach is more having alliances with a number of electricians throughout the city. We will do the design, and make it easy for them to do their jobs, providing payment schedules, project management to support throughout,” he says.
“What we’ve found is that if you have these alliances they will bring you business. For example, we had one instance last year where the homeowner went to the electrician and said, ‘I want those keypads, or that have engravings, to tell me what lights to control.’ Well, the electricians didn’t do automated lighting. They brought the customer to us and about three weeks later that client spent more than $1 million with us.”