Locks and Security News: your weekly locks and security industry newsletter
24th April 2019 Issue no. 454
Your industry news - first
We strongly recommend viewing Locks and Security News full size in your web browser. Click our masthead above to visit our website version.
Security Alarm Services in the US Industry Market Research Report Now Available from IBISWorld
The Security Alarm Services industry provides the installation, maintenance and monitoring of alarm, fire and surveillance equipment. Locksmiths are included in this industry but generate only a small portion of total sales.
"While the industry has benefited from an overall trend toward alarm and surveillance systems, the recession caused many clients to reduce security budgets," says IBISWorld industry analyst Kevin Culbert. Consequently, in the five years to 2012, IBISWorld estimates that revenue will decline at an annualized rate of 0.8% to $16.7 billion.
The fall in demand for construction following the recession reduced the number of new security systems installed. However, many companies have started to replace labor-intensive security measures, such as guards and patrols, with electronic security systems, which are often more cost-efficient. Government changes to fire and security codes have also boosted Security Alarm Services industry demand, increasing premiums on insurance policies and fueling consumers' fears of a rising crime rate. "The availability of low-cost monitored security systems for the residential market has also increased the household penetration rate," adds Culbert. "Still, the residential market is sensitive to changes in economic activity, and the recent fall in disposable income dampened demand for new and ongoing services."
In 2012, industry revenue is expected to increase 1.6% as the economy returns to recovery and businesses start to invest in security again. Despite this growth, profit will remain constricted. As a result, the number of industry firms has declined on average 0.9% per year over the five years to 2012 to 8,979, largely due to major players acquiring competitors struggling in the poor operating environment. For example, Tyco's ADT Worldwide, the largest player in the industry, acquired Broadview Security in 2010. The industry is characterized by a large number of small players, some of which are subcontractors for major players and provide installation and maintenance services. On the opposite end of the spectrum, Tyco occupies a significant portion of the market. This provides the Security Alarm Services industry with a low level of concentration.
In the next five years, industry players will increasingly take advantage of new technologies such as biometrics, which involves face or fingerprint recognition. Small business growth and increased disposable income levels will also contribute to rising industry demand. In the five years to 2017, revenue is projected to increase. Profitability will also improve as operators take advantage of the cost savings and restructuring implemented following the recession.
For more information, visit www.ibisworld.com or call 1-800-330-3772.
13th June 2012