This week's home automation podcast features our host Ron Callis interviewing Hovik Mirzakhanian. Recorded live on Wednesday, Wednesday August 10th, 2022, at 12:30 pm. EST.

About Hovik Mirzakhanian

Hovik is a 30-year AV veteran who founded Matrix Audio Visual Designs in 1991. Matrix AV specializes in integrating technology-based solutions like AV distribution and building automation systems for private businesses, educational institutions, houses of worship, the military, and the government. 

As VP of Engineering, Hovik uses his extensive engineering knowledge to recommend products and design concepts that create the perfect environment for end users. He seeks to delight customers and find the best technology solutions that help businesses meet or exceed their short and long-term goals.

Interview Recap

• Hovik’s background story and how he has seen the AV industry evolve throughout his career
• How he has been managing the current supply-chain issues 
• The importance of diversification as a strategy to help manage risk

SEE ALSO: Home Automation Podcast Episode #219 An Industry Q&A with Andrew Pino

Transcript

Ron:  Ron Callis here with another episode of Automation unplugged. We are here today for Show 220 and today is Wednesday, August 10. It is a little bit after 12:30 p.m. Eastern time and I'm getting a message over here from David that we appear to be both live on LinkedIn and on YouTube, which is pretty cool. Remember, we had historically for years been going live on the One Firefly Facebook page and we decided to change things up. So we actually are posting those videos in a rear. So when the show is finished, we actually are taking the shows and posting them up on Facebook to our One Firefly Facebook page for all of our friends and followers that prefer to consume it there. But we're trying some things up, which is what you do in marketing, you test and measure. So we're streaming the show live into LinkedIn and YouTube. This is also an exciting week for a couple of reasons and I'll share with you, my audience, what good stuff is happening. I am proud and happy to say that One Firefly has made Inc 5000 again, although I can't tell you the number because that needs to be held close to the vest until the 16th. So in six days we can make that announcement again. But this will be our third year in a row of being one of the fastest growing companies in the United States, which we're very proud of. Here at One Firefly, we wrapped up, I guess I could have mentioned this last week as well, but we wrapped up quarter two at the end of July and again had another record breaking quarter of business growth. July was in fact our best month in company history for bringing on new business. I know it's weird out there and the economy is strange, but we at One Firefly, we know we're helping our customers grow their businesses, they're telling their friends and we're very thankful people are calling us and engaging with us to find ways that we can partner. So this show, Automation Unplugged is brought to you by my day job at One Firefly. But let's get into the show today. So today for Show 220, I have a good friend, good client, known this gentleman for many years now, Hovik Mirzakhanian. He's the vice president of engineering at Matrix Audio Visual Designs out there in Southern California. Let's go ahead and bring on Hovik and let's learn about his business and his take on things today. Hovik, how are you, sir?

Hovik: Hello, Ron. How are you?

Ron:  I am good. Here I'll do the wide view so people can see your lovely logo over there over your left shoulder. I'm impressed that you actually have signage behind you. So just tell me about that because it's been very rare day indeed that anyone was prepared like this and had this ready to act as their backdrop. What is that from?

Hovik: Well, the signage. We participate in certain shows in the industry. So basically that's what we use to light up our booth, if you will. So as soon as I learned we are going to be on your show, guess what? Assembly and fire away.

Ron:  Fire away and we already have some folks saying hello over on LinkedIn. I see Chris Gamble out there. He's saying, I see you on LinkedIn. Thank you, Chris, I appreciate you. And Sean Stermer says, hey, Ron. So hey, Sean. Thanks for tuning in, my friend. So, Hovik, give us the details here, tell us where you're located, where are you coming to us from? And then just a little bit about Matrix.

Hovik: Sure. So we're here in Southern California, as you mentioned, in Burbank, California. Right now I'm just standing right in front of my camera having this show, wonderful time with you, and that's it.

Ron:  All right, and what type of work or projects do you guys do?

Hovik: Sure. So Matrix AV is a system integration company. We mainly work with corporate government, whether small cities or federal government, and then Fortune 500 defense contractors and those guys. Basically what we do is we set up conference rooms, distribution centers, as in audio and video distribution. That's basically our goal is to make life easier for our customers.

Ron:  At Matrix, what's your primary role? What's a day in the life of Hovik look like? A week in the life of Hovik. Are you selling, are you designing? Are you programming? What are you doing?

Hovik: I'm mostly designing. I'm creating proposals, figuring out what equipment we need to use for this particular application or for that application. So that's my main goal, is to be able to design the system, propose it, and then hopefully sell it to the client.

Ron:  Got it. And are you generally working within a radius of your office, or do you find yourself doing work throughout the state or throughout the country? What's a typical type of project or maybe location of a project you guys take on?

Hovik: We've done work in some odd places, but generally speaking, I think we are mostly into California by the state of California. But we've done work in Oklahoma. We've done work years ago. We did a job for federal government on an island out in northern Australia, flew to Hawaii, then from using an army aircraft, the C 141, they flew us out to the island. That was back in 2000. Oh, yeah, it's an island. You could bicycle ten minutes each end of it and done. It was just in the middle of nowhere, not a Home Depot in sight.

Ron:  So I'm betting you are not allowed to take pictures of that project.

Hovik: Yeah, the project was... I mean all email addresses were all discontinued thereafter. I couldn't even figure out whether the system is running or not.

Ron:  No kidding.

Hovik: Oh, yeah, it was pretty interesting. It was pretty interesting. It had to be done in one week. So we had the system all built up here, and back then I was in Glendale. So we built the system, tested it out, took it out there. The first system that we did was on fiber optics, and it worked out well. Of course, I couldn't tell afterwards, right? No email communications, no phones, nothing.

Ron:  No monitoring of that system to make sure it's still working, right?

Hovik: Yeah, exactly. Hell no.

Ron:  So, Hovik, take us back in time, help us understand how you landed here, what's your career look like or the history of your business experience.

Hovik: Yeah, well, my wife and I moved to US back in 1988. I left my country back in 1975, went to London, got my education there, went to Pakistan, worked for UN for about two years before I immigrated to United States. And my background, because my education was in electronics, I continued this topic, this business, basically, when I arrived in US. I worked for a company called Photo and Sound. Gosh, some of you guys out there may remember them, but interesting, I was there for a couple of years before the company closed their doors, and then I started what we know now is Matrix AV, after that. So sometime in 1991, we started Matrix AV May of 1991. It continued from service business; servicing, broadcast video equipment, recording equipment, you know, three quarter inch tapes back then, betacam SP, one inch machines. That's what I did back then, until I started the system integration business. I remember vividly when three M sold the tape business, I thought to myself, something is going on. Maybe tapes are not going to be the future. And sure enough, I remember going to some of these machine rooms in Hollywood, and you had racks of duplicating machines, and we used to service them. Now when you look back, I look at some of these machine rooms. I actually had an opportunity to visit one five years ago, same company. Those racks have turned into just maybe two, three racks full of servers. That's how things transpired, changed, technology changed, right? No more tapes. Now, of course, into system integration. Starting from the analog side, some of you guys might remember the good old RGBH three coaxial cable termination with BNCs, all the way out to analog mixers, and now everything on digital platform. We had the HDBC in the middle, and that's still pretty good option for certain applications, but now it's everything AV over it, and it's nothing but digital domain. So, yeah, it's pretty interesting, to say the least.

Ron:  1991 to the present. What are the differences, or what are the big primary differences of the types of customers you've been serving over that? Have you always been serving the same types of customers, or has that changed over time?

Hovik: No, actually, yeah, it has. Obviously, back when I was in service, I was mostly into the entertainment industry. I was in that entertainment industry because that's where the focus was. The repair business was right. Betacam SO who had Betacam SP machines, who had three quarter inch numatics. Or even the VHS, right? The good old VHS Duplication machines, who had them? Panasonic is another manufacturer, JVC, Sony's. It was the entertainment industry. When we sort of changed the business model from service to system integration, customer base completely changed.

Ron:  Do you know what year that was? Approximately? Plus or minus?

Hovik: I want to say I was somewhere 1998, 97, I think that was when. If we do a Google search, hopefully it will come up. But when three M sold the tape business, within a year I completely changed the business model.

Ron:  That's when you saw the writing on the wall, you're like that was it.

Hovik: That was it. Three M selling, I mean, it was a huge business, three M making tapes. Whether it was half inch, three quarter or one inch, it was three M. Three M.

Ron:  I'm going to ask a really silly question here. When you say tapes, do you mean like memory tapes? Like that was a form of saving digital files ones and zeros? Or is this tape as in movie picture film?

Hovik: Movie picture films on tape as an analog recording? When we talk about VHS, that's what I mean by tape or half inch Betacam sp machines or one inch recording devices. These all recorded analog audio and video. At some point it turned into the digital Beta cam, which yes, then at that point we had compression, we had digital information, but it was still recording the movie, the audio, the picture onto tape. The thing that failed was the mechanics of the machine. The electronics hardly failed. Yes, at some earlier in time, yes, they did. We had to replace certain chips. But at some point mostly was just mechanics. That was when I realized that service is no longer the name of the game. I don't think it ever was. It was a good gig, I want to say. But then system integration was always at my deep in my heart.

Ron:  I'm curious, you use the word service and I now understand, I understand that you were serving and servicing the entertainment industry's need for a technology company to manage and upkeep all of their machinery. Were you actually selling service plans? So was that actually part of the business model? You had all this customer book on recurring contracts.

Hovik: No, it wasn't a contract, it was just word of mouth and it was on time and material basis. So say you spend 8 hours going through two racks of equipment, you build them 8 hours of labor plus the parts that you use and done. That was it. At the time I didn't have any service contracts.

Ron:  Got it.

Hovik: It was me a briefcase full of tools and that's it going from machine to machine and site to site.

Ron:  So then in the late ninety s, you moved into integration. And you're saying that then that necessitated a complete change in customer base.

Hovik: Right.

Ron:  Sounds like you completely redesigned your business model, not only your product offering and your customer base.

Hovik: Yes, absolutely. Because system integration as we know it now on the corporate side. Doesn't exist in the entertainment industry. The integration there is well, back then it was just nothing but setting up machine rooms. But mostly because I was introduced to system integration, Photo and Sound company, they had a system integration division. I was on the service side. But what I was seeing back then with the Three gun CRT projectors, if anybody remembers, with Kodak data show that you would place it on a projection unit. That was system integration then. And of course I was on the service side, but I always had that knack trying to get into that. Of course, Photo and Sound didn't survive. When I sort of started with service after Photo and Sound, it was only a limited number of years. Maybe I think four or five years before system integration, I closed shop and system integration started. Again it was in Burbank.

Ron:  What was the transition then in integration like? Just for some folks listening may have only own digital. You went through another phase, transition from analog to digital and from analog into more of an IT based system design. What was that like?

Hovik: Right, I think the transition was two step. I think we were analog first, obviously with Three gun CRT projectors and your analog RGBHV switcher extrane to name one back then, some of you guys might remember RGB, I think 180 190 was the interface that you used to hook up a computer to it and then project it. That was our analog system and then we migrated into years later into HDBC. That's when HDBC came out, and then to now, which we have a sort of a hybrid solution, right, which is some integration requires a view over it, but some can be just HD based T. So we still are in that phase where we still have HD base T. But AV over IT, I mean, it's going we've got audio over network, we've got video over network, we've got different protocols to deal with Dante, AVB, you name it. Of course with the video side of it, digital various platforms from Crestron NVX to QSC platforms to buy amp. So now the picture is different. We still have to provide a solution to the customer, make sure that the end result is met. But how the signal gets from point A to point B is different.

Ron:  What do you think it is about you that has allowed your business to survive for so many years through so many fundamental changes? But yet you're still here as Hovik, you're still here as Matrix and you're still here serving your customers. I've been in this space for 22 years and I've seen so many businesses come and go and something a wrinkle in the matrix comes and poof, they're gone.

Hovik: Yeah. I think it's a two fold answer. This is a twofold answer. One would be passion. You have to have passion for this business, for any work that you do. If you get out of your bed and you're not looking forward to the day, what you're going to do; I think that's a problem right there and then. But I think and also with that passion comes education, right? If you have a passion, you certainly will go and educate yourself. I have a bachelor's degree in electronics, electrical engineering. Things have certainly changed. The operation of the transistor before that was the tube, the valve, right? And then it was the transistor. Now we're not even dealing with that stuff, we're dealing with chips. How do you address that? I think you just have to keep up with technology. You just have to keep up every day. It's like things change and you want to make sure that you pick up a book and read it. That's the least you can do, attend trainings.

Ron:  Are there other entrepreneurs in your family? Like, were your parents entrepreneurs? Did you have other people to look up to, kind of know, to go down this path?

Hovik: Yes, I think my dad, he was not an entrepreneur per se, but he was a civil engineer. He was a civil engineer. I look up to him because I saw the same thing that I see in me now. It's just every day he woke up passionate about what he did. My dad would be the one person I can go back to. Entrepreneurs, we don't have that many in our family, actually, I'll say I'm the only one. But everyone else, I think, in the family, just this having a passion is just incredible, I think source of energy that we all had in our family.

Ron:  That's cool and knowing to follow that passion. So many people get stuck in a job or a lifestyle that they're working for the paycheck or working for the 05:00 bell.

Hovik: Yeah, indeed. And that's the problem.

Ron:  It sounds so miserable.

Hovik: It's not sustainable. I don't think you can sustain yourself. At some point you'll begin to burn out. Of course there could be a true statement, even if you have a passion for something. But I think you'll burn out much sooner if you don't have that passion.

Ron:  I think of it as, does what you're doing feel like work or do you enjoy it? I think it's silly to think we all will enjoy everything we do all the time. I don't think that's possible.

Hovik: No, I get it .

Ron:  But you can enjoy it most of the time, if you've aligned your skill set, what you're doing, regardless of whether you're a business owner or you're employed or whatever you're doing, I think that concept; Find out what you're really passionate about, what do you enjoy, what are you good at, and then go do that. Then it's much easier.

Hovik: Keep at it.

Ron:  Now, I appreciate you taking us through the past there. Let's look at a high level at the last two years. I'll tell you what I think I know and then you tell me what you're at the ground level, what you experienced. We here at One Firefly, we work it with both residential and commercial integration firms. I know on the resi side, the resi integrator has generally there are pockets where this is unique or different, but generally the residential integrator has had peak levels of business demand the last 24 months by just the random lucky roll of the dice. Wealthy consumers are spending their money on their homes and the integrator is one of many contractor or service types that are benefiting from that spend. On the commercial side, I know that different industries were hit harder than others, and I know different commercial integrators were hit harder than others. I also know geographically, certain cities or states reacted different than others. There were some states where there were no changes in rules or laws and everybody conducted business as usual. I don't know this. So this is where I'm super curious to hear your experience. I think in Southern Cal it was pretty rough to try to run a business, but I don't know if your business suffered from that.

Hovik: We didn't suffer because of this Covid thing. I think one thing that really solidified was for us was, hey, video conferencing is actually evolving and what we are doing right now, right now, it used to be done with a codec, with a traditional party. Now you could do the same using just a PC, a zoom, room license, team's license, and done, right?

Ron:  Yeah.

Hovik: And it's many to many. It's not one to many. It can be one to many, but now you can have a group of people collaborate in one session, which is really interesting. That's what really kept us going through this Covid thing. Of course, now we're hit with another issue, which is supply chain issues and parts.

Ron:  I want to get there too. So let's hold that. I want to pull some threads there and find out how that's going for you. But in terms of the last, let's call it March 2020 to the present, did business stay the same for you? Was there any change? And if so, what was that change?

Hovik: I think yes, there was a change, in fact, to the better. We actually had a better business because of conference rooms that needed upgrading to be able to have the good old camera in every conference room. We certainly had upgrades during the downtime. They wanted to perform some upgrades. We didn't suffer as much during this Covid situation. I think industries such as rental and staging, they were hit hard. That was bad for them. I saw it because we were working for various hospitalities hotels and upgrading their equipment and we could see that the rental and staging folks there have nothing to do who's going to rent a conference room or a ballroom, right? And they didn't, that was really tough.

Ron:  That was devastating.

Hovik: Devastating.

Ron:  So tell me, what's the current state of affairs as it relates to supply chain? I know that I called you a week or two ago and we were going to talk about something else and you admitted to me, Ron, I'm busy trying to find a replacement product because this thing that I thought I was going to get my hands on now suddenly is not available and I've got to go find a solution. What's it been like for you and what are you doing about it?

Hovik: This is tough. I think it's tough on the industry overall, tough on the smaller integration companies, much tougher. I'm sure it's tough for the manufacturers. There's no doubt. I truly believe that every manufacturer wants to assemble the unit, the box shut, ship it out, assemble, test it, ship it out. That's the name of the game. I don't think anybody is looking forward to this, maybe the wrong term, but is enjoying what we are going through now. I do think that it's way tougher on the Integrator. Why is that? It's very simply put, we just don't deal with one manufacturer. We deal in multitude of systems, subsystems that make up the entire picture. If a piece is missing, that system isn't complete as far as the customer is concerned, well, try and negotiate the financial aspect of it. Good luck to you and that's a problem. I'm having trouble with manufacturers trying to understand that. I'm sure they see it, they know it. But how do you solve this problem? I think it is a country issue. I think we as a country, we need to look into this problem and fix it. I understand that there is the bill passed for building factories and chip manufacturing in US. But that's not going to happen until the next ten years. So ten years from now, maybe things would be better because we're building stuff more in house in the country as opposed to shipping it out or farming it out to others. But what do you do in the meantime? We need to figure that out. And yes, going back to your point now, every day as part of my goal is to figure out, okay, what am I going to do if this piece is missing? How do I replace it with one other manufacturer? Do I need to make changes in how I was thinking? And that's part of the process right now.

Ron:  When I went to Infocomm in June.

Hovik: I was there too.

Ron:  I know I didn't get to run into you. We passed each other in the night. But I remember I talked to numerous people that were there, and I would just ask them, what are you hoping to find out or discover here at the show? It was 100%, I'm trying to find anybody that can ship products.

Hovik: Yeah. I mean, that was it. It's like me going into certain booths and seeing new products, and I go, look, I don't want to see new products. You tell me, when are you going to ship this? I don't want to see this stuff. Tell me the stuff that you had. When are you going to ship it? This is the talk of the town.

Ron:  Everybody listening to this podcast is all shaking their heads right now going, preach it, Hovik. Preach it!

Hovik: Oh, boy, I wish I had a magic formula. I don't, because I'm not in their shoes. They have their problems. I'm not there figuring out, okay. What chips that you've designed it on. Can we do replacements? I do know that some manufacturers have addressed it. Kudos to them, but it is a tough gig for them, I get it.

Ron:  I'll give us a slight example. In July, my son is a good student at school, and he's won some science competitions, and some of my friends at Lutron reached out, and they said, hey, for my son, would you like to come and tour our engineering facility in Boca Raton? And so I took my son on this tour. They were a wonderful host, and we got to see the kind of behind the scenes of engineering at Lutron. And in a testing room, they were testing a dimmer, a dimmer that had a motion sensor on it. Now I know that dimmer because that dimmer is in closets all over my house. Like I recognize that dimmer. I was like, why are you testing this product that I know has been on the market for tens of years? I don't know exactly, but I know it's been around. They are having to reengineer the product with a new chip, and because they're then engineering it with a new chip, they have to run the product through all of the testing regiments for all of the countries that they sell that product into.

Hovik: Thank you.

Ron:  Everyone there had a smile on their face, but, oh, my goodness, if you put yourself in the shoes of the manufacturer and having to literally... Especially a manufacturer that might have hundreds, if not thousands of SKUs and having to reengineer just so they can remain in business, there is pain up and down the supply chain at every level. It just sucks.

Hovik: Yes.

Ron:  With no immediate solutions in sight from anyone I'm talking to.

Hovik: Exactly.

Ron:  But what do you do? You survive.

Hovik: You got to survive. You got to do what you got to do, which is, like you said, change the chipset, go through the quality control testing, all you need to do, all the stuff that you're the regiment of tests that you have to do. And the same thing with us, right? We still have to do the same thing, except they are doing it at a different level. We are doing it at a different level. I understand the pain that they're going through. I can't imagine it, but I understand it. It's not easy. It's not easy.

Ron:  Is it survivable? I'm not going to speak just for yourself, but for the industry at large. Do we get through this?

Hovik: Oh, sure, 100%. We're not going to dissolve into thin air as an industry. We're going to have pockets of problems, but ultimately we will find a way out of it. There's no doubt whether it's manufacturer, the system integrator, we'll find a way out. So the picture is bright right now. It's dim, but it's bright. It will be bright in the future, I have no doubt.

Ron:  Have you had success? And I'm going to say because your customer type and again, my experience is on both sides of the equation, residential and commercial. But in the residential world, I would say for the most part businesses have successfully been able to redesign their payment structure and their contracts. Let's just say they're getting the payments they need to allow their business to thrive or survive. I don't think anyone would say they're thriving with supply chain issues, but they're surviving and getting through it. But that's an emotional purchase. The residential consumer is generally buying it because they want it, not because they need it. In the commercial space, it's a completely different business transaction. Your customers are governments or megacorporations. Are they allowing for contracts or payment schedules to be adjusted to account for this fact that you're carrying your payroll, your operating expenses, any hardware outlay and meanwhile you can't call the job done so you aren't able to get all of your payments on the job. Are they working with you?

Hovik: Some do, most don't; I mean, when you're working with the federal government, it's a given that they want to see the end result before they make a payment. That's the way it is. You could certainly, our proposals have the schedule outlined. We certainly have made changes on our schedule. We like to get paid for the parts that we ship out and that's the name of the game now. But I think it does take some massaging talking to the customers, letting them know what the pain points are, what you need to do to make that happen. It's up to the customer to understand it. It's at that point, you know, you come to an agreement or you don't. Simple as at that. If they don't know it by now, I'm sure they'll find out sooner or later.

Ron:  You won't be the only business trying to modify terms because of the conditions out there, you're not going to be isolated.

Hovik: No, I mean, if you're going with the same structure, payment structure as you did two years ago, a year ago, I don't know what that structure is, but if it was, say, structure A, certainly it can't be the same structure now. We have to come to grips with that.

Ron:  That makes a lot of sense. I'm going to switch gears here, Hovik. There is exciting news and that you launched your new website. I've just put it up on the screen for those that are listening to the podcast. So congratulations on that. Full disclosure we work with you on that.

Hovik: Thank you for that.

Ron:  No, it was our pleasure.

Hovik: So for those that want to check it out, it's at Matrixav.com. It's a great URL, but I wanted to just jump into something, something I always love to learn more about. That is under your about section, you have a service plans page and you have service plans. Can you just tell us how service plans work in your business?

Ron:  Sure. In our business, we've got three levels of service plans silver, gold and platinum. Generally speaking, your silver level is nothing but a maintenance agreement that you have with the customer. You show up four times a year, you go through the system, you bring to customers attention what needs to be done, and you do it based on your input costs associated with that and done, that's your silver level. Then you got the gold and the platinum level, which is the same as silver. You do the same things, except with gold, you've got parts at it. So in other words, anything fails, we will replace it or repair it, even if it's a projector. So that's your gold level. Platinum is no questions asked; Labor parts are all included in that level. Again, it follows with whatever is in gold and silver.

Ron:  Where in the sales cycle or the client experience from beginning to end, when did they became aware that you have plans?

Hovik: Right at the time when proposals are gone out.

Ron:  Okay. And what percentage of your clients commit to some package?

Hovik: What a question!

Ron:  That's a heavy one.

Hovik: That's a heavy one. I would say, our job is to introduce it, to tell them, to talk about it, what the benefits are, and that's up to them. But to answer your question, most I'd say about a quarter of them follow through because we have time and material. Because we have time and material also, so in other words, what happens if I don't want any of these agreements, right? Well, sure. We'll come out. Our normal warranty on a system is one year, and after the year is up, something goes wrong, you pay for it on an hourly basis. Here are our rates, here are travel fees. Do the math. How many times is it going to fail? Your guess is as good as mine. It may never fail. It may never fail. It might fail once or twice if something goes wrong, depending on if you've well protected. Things generally run pretty good, to be honest with you.

Ron:  What are you most excited about on your website? What type of content that people are checking out? Is there any your brands or your solutions stuff? Is there anything that has you jazzed?

Hovik: I think the brand page is pretty cool. That has me pretty excited. And of course, the main page, the landing page, I got to add more stuff there, but basically the brand page is pretty cool. And of course, the main page. I love it.

Ron:  Yeah, it's beautiful. Yes, it really is. All right, let me pull that off. When you look ahead, Hovik, what has you the most excited as you look ahead? And I'm going to seed that question with a little fear because I'm saying maybe we're in a recession or maybe we're going to head into a recession. What's your take on that? Then kind of when you look ahead, you made a comment a bit ago, things look brighter in front of us. What's your forecast?

Hovik: I'm not an authority to say whether we are or we will go into a recession. I think the problems we're having as a nation, this inflation, I think it's all supply driven. It's not demand driven. By that I mean is that the products are not available, therefore prices go up. It's not that because everybody wants it and the products are available, therefore the prices are going up. So I think it's a moot point to throw money at it from a government perspective, because it's supply driven, products are not available. You got to fix that problem. How do you fix it? Not by throwing money at it, but actually building the infrastructure to support the goal. The infrastructure needs to be changed. We have to really think this through. I'm not sure if we're going to go into a recession or not. I think for the short term, I think the picture isn't that great. We just need to go through this storm. We just have one way or another, we just have to take these wind, this swell of waves that are coming. We need to take it, we need to persevere. And if we come through this, which we will, 100%, I think we'll be much stronger. But it's got to be done, I think, correctly. It is not an industry issue, this is a country issue. We ordered a conference table, for the love of God, right? And it took six months for the wood to get to from manufacturing to the conference room. And I'm thinking to myself, I picked up the phone to the manufacturer and I'm saying, dude, there's no chip in the wood. Why is it taking six months? Well, guess what? There is no labor to supply the wood to the manufacturer or there's parts missing in the saw machine, you name it, whatever it is. And that is just supply chain related. I think the picture is for the short term isn't looking good. I think for the long term it's going to be great.

Ron:  You've been in business long enough to have weathered some storms. You would have weathered the 2000's, would have weathered the 2008 and 09. Now we have this situation. Is there anything you're doing as a team or in leadership or kind of financial stewardship of the business? Is there anything you're doing to make sure that you're there and you're going to make it through this one as well? Is there anything?

Hovik: Well, yeah, cut cost as much as one can. Make sure that you're running lean and mean. I think as an industry, we're suffering from a good pool of talent, people that know what they're doing, basically. But we need to cut costs. We need to make sure we have and by lean and mean, you have to have quality people on your staff to address problems, address issues, and be able to weather this storm.

Ron:  So what I'm hearing you say is really taking a close look at everybody on the team and make sure they're carrying their weight. Make sure they are delivering value.

Hovik: They are delivering value. That's the name of the game. It's always been the name of the game, value. But you just have to massage it more. You just have to work at it more.

Ron:  Yeah. Sometimes companies, when the times are fatter and happier, they can get bloat. They can take on additional personnel or additional expenses that are not critically necessary. But the business is doing so well, it can afford it.

Hovik: Yeah, right. Because it's not no longer the game. You got to be careful.

Ron:  That's wise. We'll close on this Hovik. A lot of folks that listen to the show, they might be earlier in their entrepreneurial journey. What's a token piece of advice or two that you'd give to that younger professional, that younger entrepreneur? Again, younger not being age of the individual, but age of their entrepreneurial journey?

Hovik: In this business, right?

Ron:  That's right. In our business, any piece of advice or two?

Hovik: Don't put all your eggs in one basket. In other words, diversify. Don't just pick manufacturer and stick with them. Make sure you cover your bases. Make sure you know the market, that particular market, whether it's audio, whether it's video, I think the name of the game has changed. We used to be adjusting time order and business. It's no longer that. Now it's like you have to sort of either trying to keep some inventory, but how do you do that with the slew of products or lines of products that you have to carry? How do you do that? Which to me doesn't make sense. So my thought on this is that, look, do your homework. Make sure if you're going on manufacturer a, that you know that there is a manufacturer b that does the same thing. This has been a problem. I think that newcomers need to keep that in mind that don't put all your eggs in one basket with this manufacturer or that manufacturer, because that manufacturer, if they're an elephant and you're in bed with them, guess what? When that elephant turns over, you may be squashed.

Ron:  Sage advice. And a book is coming to mind. There's a book called Spencer Johnson wrote a book called "Who moved my cheese?" And it's a story that I'm trying to think of the right word, but it's a fable, perhaps that tells a story. And there's a business lesson in there. The short version is that the cheese moves, and either you're going to go out and find the cheese, or you're going to sit there and starve, waiting for it to return.

Hovik: Exactly!

Ron:  You're describing a business climate that's changed, which means you have to do business differently today than the way you could do it three years ago. And if you don't adapt, you die.

Hovik: Yeah. What happened to polaroid? Kodak? There you go.

Ron:  Brilliant! Hovik, it has been awesome to have you on show. I'm trying to look here. Show 220. Oh, my goodness. For folks that want to follow you, get in touch with you or learn more about Matrix, where would you send them?

Hovik: Well, our website is matrixav.com. Email is This email address is being protected from spambots. You need JavaScript enabled to view it.; This email address is being protected from spambots. You need JavaScript enabled to view it.. So those are the few places that I could run. Of course, the traditional phone also exists; 888-883-4836.

Ron:  Awesome! Hovik, it's been a pleasure, sir.

Hovik: Thank you. Thank you for having me, Ron, it was a pleasure. Thank you.

SHOW NOTES:

Hovik is a 30-year AV veteran who founded Matrix Audio Visual Designs in 1991. Matrix AV specializes in integrating technology-based solutions like AV distribution and building automation systems for private businesses, educational institutions, houses of worship, the military, and the government. 

As VP of Engineering, Hovik uses his extensive engineering knowledge to recommend products and design concepts that create the perfect environment for end users. He seeks to delight customers and find the best technology solutions that help businesses meet or exceed their short and long-term goals.

Ron Callis is the CEO of One Firefly, LLC, a digital marketing agency based out of South Florida and creator of Automation Unplugged. Founded in 2007, One Firefly has quickly became the leading marketing firm specializing in the integrated technology and security space. The One Firefly team work hard to create innovative solutions to help Integrators boost their online presence, such as the elite website solution, Mercury Pro.

Resources and links from the interview:

• Hovik Mirzakhanian LinkedIn
• Matrix Audio Visual Designs, Inc.
• Matrix AV Service Plans

Hovik can be reached directly by email at This email address is being protected from spambots. You need JavaScript enabled to view it.