Systems integrator-focused business management software provider D-Tools today announced the release of its 2024 Year-in-Review Market Health Report, offering “an in-depth analysis of industry performance, key trends and strategic insights based on real project data from over 3,000 active integration companies.”
The custom integration industry grew by 6.5% in 2024, showing “resilience amid inflationary pressures and election year uncertainty,” according to the D-Tools announcement. The report, compiled from more than 175,000 proposals and more than 70,000 signed contracts in D-Tools Cloud, uncovers “essential industry shifts and actionable insights for business leaders in the year ahead,” the announcement says.
Key Findings from the 2024 D-Tools Market Health Report
The market saw a 6.5% increase in total installation sales in 2024, with the average project contract hitting $17,535, up from 4.6% in 2023. Growth was stronger in the first half of the year before contract values declined 4.8% in Q3 and Q4, largely due to election-related uncertainty, according to the D-Tools report.
Projects valued at more than $10,000 delivered profit margins of 45%-47%, while smaller projects (less than $10,000) had lower margins of 30%-39%, reinforcing the financial benefits of targeting larger installations, the report says.
Integrators created 10% more proposals in 2024, with an average proposal value of $37,057 (+5.3%). However, the close rate declined from 59% to 53%, signaling increased competition and cautious consumer spending, according to the D-Tools research.
Labor revenue grew slightly, making up 24.1% of contract value compared to 22.2% in 2022. While still lower than other trades (e.g., electrical, HVAC), the trend indicates integrators are protecting labor rates more effectively, the report says.
Display devices remained the top-selling category, while surveillance cameras climbed from #4 in 2023 to #2 in 2024, reflecting growing demand for security solutions.
“The data from the 2024 Market Health Report provides a clear roadmap for integrators navigating an evolving business landscape,” says Randy Stearns, CEO of D-Tools, in the company announcement.
“With rising project values, an increased focus on labor profitability, and shifting demand toward security solutions, this year’s insights highlight opportunities for integrators to refine their strategies, improve margins, and position themselves for long-term success,” he says.
Strategic Takeaways for 2025
To maintain profitability and drive growth in 2025, the D-Tools 2024 Year-in-Review Market Health Report suggests integrators should:
- Prioritize larger projects to maximize profitability;
- Enhance proposal strategies to improve close rates and reduce discounting;
- Expand into high-growth categories, such as security solutions;
- Leverage automation tools to streamline proposal and project workflows; and
- Benchmark performance against industry growth trends to remain competitive
The full D-Tools 2024 Year in Review Market Health Report is available now for D-Tools users and industry professionals.
Another version of this article originally appeared on our sister-site Security Sales & Integration on March 18, 2025. It has since been updated for Commercial Integrator’s audience.
