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Hikvision driving growth of surveillance products with ‘optimum’ number of dealers to cement position in video camera market

Published on 8 October, 2015

Hikvision USA’s ascension from virtual obscurity to the upper tier of manufacturers in the U.S. market is being built on the Chinese company’s huge manufacturing capacity – they turn out 50,000 to 60,000 surveillance cameras every day from factories in China. The large capacity enables Hikvision to achieve economies of scale. In effect, they can make high quality video surveillance products at a lower price, a capability that will continue to serve them well as they begin competing for larger jobs and for price-sensitive project business.

“We can make a superior quality product with a competitive price,” says Alex Asnovich, Head of Marketing at Hikvision USA. “We will have the upper hand as the market moves forward,” says Asnovich. “Our brand has been established, our channels are up and running, we will be winning more projects.”

Establishing dealers/integrators

On the dealer-integrator front, Hikvision will be looking to establish the “optimum number of dealers” in each geographic region, says Jeffrey He, President of Hikvision USA and Hikvision Canada. There is no magic number; it’s just a matter of how many dealer/integrators are needed to serve the region. Hikvision will be seeking out the integrators who “drive the business” in each region, he says. “How do we create profit opportunities for those driving the business?” Mr. He adds that Hikvision is currently assessing the dealer/integrator mix, with an eye toward providing an attractive program with profit opportunity for dealers, while zeroing in on dealers that can enhance Hikvision’s business.

The video camera market is not
large enough to support the
current 150 or so camera
manufacturers, so it’s a business
likely to face more consolidation

Hikvision will also be looking to help absorb some of its integrators’ internal costs, such as the cost of writing specifications and participating in end-user presentations, says Mr. He.

“A lot of integrators don’t understand what we can do for them on the project side,” says Mr. He. “Through marketing and our foot-soldiers, we have to show people we are good. We have to be extremely responsive. I am challenging our organisation to look at who is the best of breed, whether they provide services or products, and how we can do it better.”

Distribution channels

From distributors, Hikvision will be looking for value-added services such as pre-assembly, pre-loading of IP addresses, ensuring connectivity with VMSs, etc. They will also be seeking out distributors that have “exceptionally good brick and mortar locations” to ensure local availability of product, he says.

Focusing on vertical markets

The video camera market is not large enough to support the current 150 or so camera manufacturers, so it’s a business likely to face more consolidation. “In five to six years, there won’t be that many manufacturers able to sustain their cost structures,” Mr. He predicts. “My goal is to make sure Hikvision is well positioned to survive. We need to earn our way into the customer’s business.” Customers also want a company that is financially stable, he notes.

Asnovich says the market can expect a lot of activity from Hikvision in the next few months, including more focus on specific vertical markets and ramping up outbound marketing activities.

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