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Segment Outlook 2019: Commercial and Industrial Lighting

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Segment Outlook 2019: Commercial and Industrial Lighting

From controls to the impact of recent and impending tariffs, manufacturers share their predictions for the C&I lighting sectors in 2019 and what distributors need to know to maximize their participation.

 

Will the new year bring a strong lighting market? Below, experts from Signify and Hubbell Lighting share their predictions for the Commercial and Industrial lighting segments, external factors affecting those markets, and how distributors can tap into their share of opportunities.

2019 Forecast:  Commercial & Industrial Lighting

According to Heather Milcarek, head of Professional Channel Marketing at Signify, the most immediate trend affecting the C&I lighting sector is the increasing demand for more efficient light. “In the U.S. specifically, buildings consume 41% of total energy and lighting is the single largest end use of electricity in buildings, according to the Energy Information Administration,” Milcarek said. “LED lighting, along with smart controls, can contribute to more sustainable, efficient, and effective workplaces across almost 15 billion square feet of existing office space in North America alone.”

“Another trend is the continuing growth and adoption of connected lighting systems and services,” Milcarek noted. “Beyond energy and operational savings, connected office lighting can also enhance the well-being and productivity of any organization’s most important asset – its people. Americans, for instance, spend approximately 90% of their day indoors, much of that in their workplace. Imagine now if functional illumination at the office were replaced with human-centric lighting – e.g., science-based lighting designs that benefit human physiology and psychology. Connected office lighting can adapt based on the time of day, availability of natural light, as well as individual preferences.”

By using a combination of light quality, color, and intensity, said Milcarek, employees can specify their preference for the right light at the right time to support a diverse range of daily activities, from independent focused tasks to collaborative brainstorms. “For example, changing the color and intensity of the lights can help transform a conference room into a shared creative workspace,” she said.

Clayton Smith, director of business development, C&I Distributor Sales at Hubbell Lighting, agreed. “In a recent AIA study, architects and building owners reported that they’re placing greater emphasis on the impact of design decisions on human health, with nearly 75 percent of architects and 67 percent of owners saying that health considerations now play a role in how their buildings are designed,” Smith said. Among other solutions, Smith said that color tuning capabilities are giving occupants the ability to ‘control’ the space and set the mood based on the application, specific activities, and occupant preferences to drive improved performance, productivity, and morale.

Among other trends, Smith said that tariffs are influencing the sales cycle in the C&I sector. “With the next tariff set to take place January 1, 2019 – over and above the current tariffs already in place – there’s been an increased push to release jobs now and ensure that current pricing is in place,” Smith said.  “That being said, the next proposed tariff in January could possibly cause jobs to be pushed out later in the year, as end users may decide to wait to see if there could be any tariff adjustments/relief now that mid-term elections are over. Eventually the jobs will be released and expectations are that Q4 2018 should be strong, with Q1 2019 starting out flat; we then anticipate small growth in the C&I sector in Q2 2019 and throughout the balance of the year,” he said.

Seizing the Day

According to Smith, distributors have an opportunity to take advantage of this market growth by understanding the unique needs of the local customer and specific energy codes that shape lighting solutions.

“The language and methodology for specifying lighting projects has evolved and implementing LED and control products isn’t a one-size-fits-all experience,” Smith said. “As a result, there’s tremendous value in having localized expertise and those distributors with dedicated control specialists will be able to add value versus their competition.”

“At the recent NAED Eastern meeting,” Smith noted, “one of our key distributor partners – who’s best-in-class when it comes to adding value to the channel – shared that they’ve added trained Certified Field Technicians to their staff, which gives them the ability to handle the controls commissioning and establishes them as the ‘go-to’ distributor for future opportunities.”

At Hubbell Lighting, “we’re working with our channel partners to help them increase the number of control experts on their staff by certifying field technicians who can commission and/or troubleshoot control projects,” Smith said.  “These trained experts can fill the demand for commissioning software that empowers facility managers with real-time monitoring, instant alarm notifications from faulty lighting equipment, and increased network efficiency and maintenance operations – all from a smartphone or tablet.  This will ultimately help distributors set themselves apart from their competition,” he said.

Signify’s Milcarek agreed that distributors have a distinct opportunity to help their customers navigate the gradual shift to connected lighting systems. “By staying up-to-date on the latest technologies, products, and features available, distributors can deliver value to their customers by making it simple to purchase, manage, and reap the benefits of connected lighting,” she said. “Signify recently launched ‘Interact Pro,’ an easy-to-install-and-commission connected lighting solution that provides a dashboard, personal control, and data collection for small and medium-sized businesses. The wireless system and app-based set-up means that it can be installed more quickly and easily, reducing a contractor’s time on site and the volume or frequency of callbacks.”

According to Milcarek, Interact Pro is the only system able to mix luminaires and lamps in a connected system with the same level of features, such as dimming, grouping, and scheduling, which is particularly advantageous to contractors who need the flexibility to serve a variety of applications and projects.

Ultimately, “every customer is at a different stage along the connected journey,” said Milcarek of her advice for distributors serving the C&I segment. “It’s important to work with a manufacturer that can not only support different types of applications, but who also has the knowledge and available product portfolio to partner with you to meet your customers’ needs.”

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Susan Bloomis a 25-year veteran of the lighting and electrical products industry. Reach her at susan.bloom.chester@gmail.com.

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