Executive Summary
The
UK private security industry addressed a market worth £4.42bn in 1996.
Total growth over a 3-year period, from 1993 to 1996, is estimated at 21.4% and
the market is expected to have grown by a further 4.1% in 1997 to reach
£4.6bn.
Included
in this market study are manned security services, electronic security,
physical security, vehicle security and fire protection, and there are various
subsectors within these categories.
Growth has been rapid in the sectors of electronic security and vehicle
security. The intruder alarm market has reached maturity, but there is still
strong growth in access control and closed circuit television (CCTV).
Electronic article surveillance (EAS) is still held back by the fact that three
incompatible technologies exist, each with their advantages. Nevertheless,
source tagging is at last starting to happen and many of the major retailers
are committed to investment in EAS. Monitoring of intruder and fire alarms and
CCTV is another growth sector. Monitoring is offered by some of the large
installation companies, but the manned security companies have also moved into
this activity.
The market for manned guarding remains fairly flat and the industry has to
compete with the electronic security sector, where prices fall as technologies
become established. Demand for cash handling services has been declining
gradually, so the manned security companies are looking to other areas, such as
monitoring and prison escorts, to boost their sales. Margins are low in the
manned sector and the issue of introducing compulsory regulation has yet to be
settled. Nevertheless, there is still a strong demand for guarding from sectors
such as retailing, which find that electronic security alone is not enough.
The market for physical security products is very mature, but could receive a
boost as the level of commercial building improves.
Fire protection is another mature market, but around half its revenue is
derived from ongoing services.
The motor vehicle security sector has boomed in recent years, thanks to the
growth in vehicle production and cars on the road. Security is a strong selling
point in the car market and many models now have immobilisers fitted as
standard. Tracking systems for stolen vehicles have proved extremely
successful, but are still limited mainly to vehicle fleets.
| Table
1: Value of the UK Security and Fire Protection Market by Sector at Current
Prices (£bn and %), 1993-1997
|
|
1993
|
1994
|
1995
|
1996
|
e1997
|
|
|
|
|
|
|
| Manned
|
39.7
|
39.5
|
37.9
|
37.9
|
37.2
|
| Electronic
|
26.1
|
28.6
|
29.9
|
30.1
|
31.0
|
| Physical
|
15.5
|
14.5
|
13.8
|
13.4
|
12.9
|
| Vehicle
|
4.7
|
4.5
|
5.1
|
5.3
|
5.6
|
| Fire
|
14.0
|
12.9
|
13.3
|
13.3
|
13.3
|
|
|
|
|
|
|
| Total
|
100.0
|
100.0
|
100.0
|
100.0
|
100.0
|
|
|
|
|
|
|
| Value
(£bn)
|
3.63
|
4.02
|
4.22
|
4.42
|
4.60
|
| e
-- Key Note estimates
|
| Source:Key
Note
|
Original
research carried out by Gallup Organisation Ltd for Key Note, found that the
ownership of all main types of household security devices has increased
considerably since 1992. Smoke alarms have now reached a penetration level of
82%, but there is a much lower ownership of extinguishers and other types of
home fire protection.
The research also covered opinions as to the causes of crime. Unemployment, bad
parenting and lack of a family environment were the factors blamed by most
people, but there was some difference between the age groups. People over 65
were the most likely to blame leniency of judges sentencing, while young people
were the most ready to include urban deprivation as one of the factors.
The
range of products and services is diverse and there are several hundred
suppliers, large and small. Two very large corporate acquisitions have taken
place in 1997, as a result of which two leading groups share around 16% of the
UK security and fire protection market between them and dominate certain
sectors. These groups are Williams PLC, which acquired Chubb Security PLC; and
US group Tyco International Inc., which acquired ADT Ltd (an international
group based in Bermuda). Williams PLC now has a presence in nearly all UK
security sectors, while Tyco's subsidiaries concentrate mainly on fire
protection and electronic security.
Trends
which will work in favour of the market include the upturn in commercial sector
building after a long period of depression, which this should help most of the
product sectors. The level of crime is falling, but violent crime is still on
the increase. The violent crime factor maintains public awareness of the risks
at a high level, and pressure on the Government to address crime levels will
continue.
Continued encouragement by the insurers, in the form of reduced premiums, would
help the market and this applies to home insurance, commercial insurance and
car insurance.
Sectors which offer good prospects for further growth in the next few years are
access control, electronic article surveillance and CCTV. In the longer term,
integrated systems are likely to become more widespread. These will include
fire protection and various types of electronic security, together with
building management and other administrative functions.
Sixth Edition 1997
Edited by Simon Howitt
ISBN 1-85765-769-1
|
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