How AV Companies Are Scaling and Addressing Regional Challenges
Let’s face it, 2024 has been a challenging year for the AV industry. However, there’s still hope for 2025. According to Mordor Intelligence, the Professional AV Systems Market is projected to grow from USD 282 billion in 2024 to USD 354 billion by 2029, reflecting a compound annual growth rate (CAGR) of 4.65%. Hopefully, the Trump administration will help reactivate the economy, but the main thing we need is getting people back into offices. (Apologies to all our remote software developer friends, please remember to support local businesses!)
This growth will mainly be driven by partnerships, acquisitions, and product innovations that will strengthen supply chains and address rising demand. In competitive regions like Latin America, major players are leveraging strategic acquisitions and collaborations to maintain their edge.
AVI-SPL’s Strategic Expansion in Latin America
To enhance its global footprint and local capabilities, (and probably reduce engineering costs) AVI-SPL announced the acquisition of ICAP Global Group, a LATAM leader in AV and unified communications technology with operations in Argentina, Chile, Colombia, Peru, and Spain. This follows its 2022 acquisition of Grupo Multimedia in Mexico.
Unlocking Regional Growth Potential
The Latin American AV and digital transformation landscape has been way more active, mainly because it is still catching up to the North American market thriving, but also driven by the widespread adoption of IoT technologies, connected devices, and transformative initiatives across sectors. In 2023, the region’s digital transformation market reached USD 57.7 billion, and it is projected to grow at an extraordinary CAGR of 27.1%, potentially reaching USD 309 billion by 2030. Fast-growing segments like cloud computing and AI are at the forefront of this surge.
Countries like Brazil and Mexico are pivotal to this transformation. Brazil is advancing automation in manufacturing and leveraging its robust oil and gas sector, while Mexico is spearheading innovations in digital infrastructure. These trends are creating strong demand for advanced AV solutions as industries integrate cutting-edge technologies to optimize operations and enhance user experiences. Let’s not forget to mention the changes in Argentina, a very strong country that has been on the back burner for quite a while, we’ll start to see some investments.
The rapid pace of digital transformation underscores significant opportunities for AV integrators and technology providers to support these transitions effectively.
Strategies for Scaling in the AV Industry
- Expanding geographic coverage is crucial for growth, with companies leveraging regional subsidiaries and partnerships to enter underserved markets. This approach provides faster response times and localized services, enhancing client satisfaction.
- Addressing margin pressures in regions like Latin America requires a multi-faceted strategy. Companies must streamline operations by consolidating resources and centralizing teams to increase efficiency and reduce redundancy. Offering value-added services, such as consultancy, support, and maintenance, fosters long-term client relationships and creates a competitive edge. Additionally, adopting advanced technologies to automate routine tasks is essential for improving operational efficiency and reducing labor costs, ensuring profitability despite tight margins.
- Subcontractors play a vital role in market expansion, enabling companies to reduce overhead, scale operations dynamically, and access specialized expertise without committing to permanent hires.
A Roadmap for Success
Scaling in the AV industry requires a strategic blend of acquisitions, geographic expansion, and operational efficiency. For regional players, staying competitive depends on a commitment to innovation, collaboration, and customer-centricity. By embracing these strategies, companies can unlock growth potential and thrive in an increasingly digital and interconnected market.