The safety & security industry: fragmented, diverse and powerful – Service providers and manufacturers need a clear positioning

maconda news February 2015

Accidents, disasters and fires can affect people and places anywhere and anytime. In the developed countries all over the world, fire services, civil defense units and police forces are equipped to react in the most efficient way possible. At the same time, other areas suffer from an insufficient or total lack of this protection. Burglaries, robberies and the increasing fear of terrorist attacks present further challenges. These are also dealt with by private security providers and specialists for a wide variety of security technologies.

Safety first! A booming safety & security industry

Faced with ongoing globalization, the rise of the previously scarcely protected developing countries, new transport routes and the expanding travel industry, governments are increasingly being compelled to expand their efforts toward public welfare, which entails providing for essential safety and security needs.

The world has been changed by international terrorism, and not just since the tragedy that was 9/11. Numerous localized regional conflicts have had their effect as well. Climate change and its anticipated catastrophic impact – storms, tornadoes, landslides, forest fires, drought, flooding, etc. – mean that civil protection structures must uphold the highest standards. Aging populations will profoundly change the personnel structure of first responders. Concepts and technologies to offset these changes have to be developed and implemented.

However, beyond these international structures and general trends, Germany shows substantial deficits on a domestic scale. Problems range from a backlog in investments in the modernization of vehicles and equipment belonging to fire and disaster management units, the insufficient CBRNE detection and reaction capacities, surveilling and securing traffic infrastructure (sea ports, air ports, railroads, subways, etc.), disease and hygiene control and management and finally personnel and organisational issues.

Only a fundamental, forward-looking redesign of the civil protection system will suffice to successfully face these challenges. Several areas already show initial change in their security structures. Service models are becoming part of the security landscape. Initiatives and developments looking to achieve this are also taking place on a European level. A study has presented an above-average growth outlook in the industries for security technology, civil protection and services. Industry turnover in Germany alone is forecast to jump from 20 billion (2008) to 31 billion Euros (2015).

New needs and technologies along with structural change require corresponding products, solutions and services. Some manufactures and producers have not yet adapted to these requirements. They are either not ready for the future, or are waiting for others to provide inspiration or the necessary growth financing. The market is on the move.

Therefore, companies active on these markets must develop a strategically razor-sharp positioning to be prepared for further growth and to make skilled use of the complex technological advances. Smart home applications are a good example, which includes security technology for private users, be it intelligent security systems, smart locks for doors or video surveillance via IP networks. Smart grids, i.e. intelligent energy networks, also require many forms of security, ranging from the security of supply to being safe from outside interference.

maconda advises security specialists and assists investors interested in the safety & security industry

maconda has been a reliable partner for several clients in this diverse industry. These include security technology providers for various applications (smart home, video surveillance systems, data protection, etc.), specialists for passive fire protection, manufacturers of aggregates, fittings and special-purpose vehicles for active fire protection, but also specialized service providers for the removal of fire, water and hail damage and service providers catering to civil protection authorities. Last but not least, we have advised leading security service providers, a challenging industry due to its high personnel costs.

Please do not hesitate to get in touch should you require our expertise. We look forward to hearing from you!

About maconda

maconda carried out over 450 consulting and implementation projects. In addition, more than 120 commercial due diligences have been conducted, mainly for private equity investors and usually in the range of € 20-500 million enterprise value.

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