How has the industry survived? By morphing its structure not just to compensate but also to meet and beat the economic challenge, expanding sales by more than four times the growth of the world’s GDP.
Our latest report shows that the minnows are taking on the sharks and winning, both through the development of leading-edge products and now growth through acquisition and alliances. Growth has also come through restructuring business models in order to deliver products and systems that are transforming the security industry from a cost centre to a cash generator.
The total value of world production of products at factory gate prices in 2012 was $20.57 billion. Of this, video surveillance products – at $10 billion – increased their share to 49%. Access control (at $4.8 billion) took a 23.5% share and intruder alarms (at $5.77 billion) had a 27.5% share.
The two major drivers have been the 11.8% aggregate growth in the video surveillance market and higher levels of demand in Asia, which has increased its share to over 35% for all physical security systems.
More modest growth in North America and Western Europe
Growth has been much more modest in North America and Western Europe, though, with an aggregate increase of 6/7% and 3.5% respectively over the last three years.
We forecast a CAGR of 5% over the next five years despite troubled economic trading conditions.
It’s fair to say that the security industry is now in a much healthier state, with a product portfolio that can deliver more attractive opportunities for its clients to improve security and at the same time profit from it.
Together with the unstoppable growth of IP video network and access control coupled with management identification and verification, this will drive the market forward.
In addition, as our report shows, further growth opportunities are opening up in relatively new vertical markets and also across the ‘Smart Buildings’ sector, where system integrators are using PISM, PIAM and SAP platforms to deliver holistic solutions.
*Check back on Info4Security tomorrow to read our full analysis: ‘The security industry restructures to meet new challenges’
Allan McHale is director of Memoori
The Memoori Blog focuses on business intelligence, comment and insight in relation to the physical security and smart grid industries (access the dedicated web link below)
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