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HomeNewsElectronic Security SWOT Analysis

Electronic Security SWOT Analysis

Electronic Security SWOT Analysis Released.

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Electronic Security SWOT Analysis Released.

Electronic Security SWOT Analysis – The electronic security industry is increasingly complex, and that makes a coherent SWOT analysis tough. But there’s still value in trying to get a sense of where the risks and opportunities lie.

When considering security integration and security distribution businesses, as you undertake a SWOT you can see they experience different aspects of the same market forces.

Different integrators may have different experiences of the same market, depending on the brands and skillsets they carry. Different distributors will also be exposed to different challenges predicated on the brands they carry, their relationships with key verticals, and the nature of the systems they provide.

Some distributors will benefit from being niche and can rely on strong relationships to smooth over bumps in the market. Others, especially, if there’s a lot of product sharing from manufacturers, may find the contest more challenging.

When considering the idea of a SWOT analysis, we initially thought to get input from integrators and suppliers, but decided our thinking would be rawer if we shot from the hip, having spoken with industry players on the QT.

Strengths

A core strength of the industry is that in most applications security and automation solutions are standard fare – no different to fire systems. This supports but does not make our solutions immune to the challenges facing the market.

Rapidly changing technology offers plenty of good things to end users as they push for more functionality and more efficiency.

Security is no longer a grudge purchase for many users – it’s about ROI, duty of care, situational awareness, safety, proactive response and more. For homeowners, automation, doorbells and CCTV now figure in their thinking.

Security technology is mature – so is networking technology, whether wired or wireless, and security installers and integrators have a fast-growing IT and networking capability. All this plugs the industry into growth.

Cloud solutions have potential to make mildly complex installations easier and faster to install, commission and maintain.

Most security and automation solutions are still not set up to maximise their potential when it comes to reducing staffing needs through remote monitoring and response, or through automated filtering and reporting of events by AI. There’s plenty of opportunity to empower electronic security solutions to offer these functionalities.

The industry’s powerful capacity for relationships continues to translate into meaningful business partnerships, ensuring best possible technological solutions are available to end users.

Crime rates, which fell dramatically through the pandemic, are heading back to ‘normal’ levels. That includes burglary, shoplifting and more. Rising crime will drive electronic security uptake. Sad but true.

Weaknesses

The ANZ (and global) economies, which are on a rack between rising inflation, including wages, and rising interest rates, are certain to slow down. Key factors include slowdowns in building, and business and government spending.

Staff shortages are acute, and are likely to get worse. Wages are increasing – especially for competent and experienced techs.

Price competition in hardware is being driven by manufacturers oversharing their product ranges – this is seriously impacting margins at a delicate moment.

Encroachment of cloud solutions into traditional security spaces has potential to weaken and/or overturn existing business models. There’s also a hybrid element to cloud-based alarm and access control solutions. The internet is reliable but it still needs back up – especially in Australia and remote parts of NZ.

The growing power and falling cost of wireless networks has the potential to create next-level DIY security solutions that may impact on traditional business models.

End user focus on the interface and network is leading to hardware cost cutting at the edge by some system manufacturers.

Some security manufacturers, especially in the alarms market, have been under investing in R&D for decades. If they don’t OEM or acquire, they will soon be gone.

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Electronic Security SWOT Analysis 3

Opportunities

Digital transition has gone mainstream – it means everything old is going to be taken out and replaced with something so much better it’s irresistible. Adding a couple of live video streams to an alarm system is simply too good, and too useful.

Cloud solutions proffer fresh income streams for those who can visualise and sell fresh business models. This is relevant in alarms, access control and CCTV – Qolsys, Gallagher SMB and Ava spring to mind as examples. There are loads more, with more coming.

Thoughtful AI applications will empower homeowners and business owners in useful ways, saving them money and reducing anxiety by leveraging data from very reliable sensors.

Improvements to network performance will increasingly allow electronic security solutions to express their functionalities fully.

A combination of local and remote wireless, improved battery tech, and cheap solar, promises to make more complex wireless security solutions stand alone.

High cost of security staff will drive analytics, robotics, remote access, wireless, mobile management and more.

Security and automation penetration in residential premises remains pathetic in Australia when compared to the rest of the world. In Australia it’s 5-6 per cent. In the U.S. it’s over 20 per cent.

Increasing cost of energy will fuel ongoing and deeper digital transition, and empower automation solutions and battery-supported renewables, while encouraging ROI strategies that play to the industry’s strengths.

Maturing of AI and robotics will allow more flexible solutions that don’t deliver raw data flows but assessments, situation reports, trends, as well as AI, including line crossing, gunshots, etc.

Servicing rental residential with DIY wireless and professional monitoring services is an untapped opportunity. Wireless is so good and so affordable today, it’s a mistake not to use it.

COVID has highlighted the value of automation, remote management and networked solutions. These are technologies the electronic security industry is all over.

DIY security solutions from big consumer distribution companies are generally total crap – if the pro security industry can find middle ground – offering capable and reliable security, CCTV and automation systems with affordable monitoring and support, lateral growth will follow.

Post-COVID many businesses are re-opening and new businesses are launching. They will need flexible CCTV, alarm, access and automation solutions with low capex and solid ROI. The technology exists – it needs to be imagined into solutions and business models.

Another opportunity that emerges from a bleak undercurrent is the growing hunger of organisations and individuals to manage energy use in the most efficient way as part of a response to accelerating global climate disasters, including fires, floods and extreme heat events.

The industry’s automation, communications and remote monitoring capabilities come strongly into play here, delivery situational awareness and proactive response capabilities to private and government organisations.

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Electronic Security SWOT Analysis 4

Threats

Staff shortages are a big threat to efficiency and will lead to wage growth inflation.

The economy. An economic slowdown will impact on building but may enervate renovation as a counter balance. There may be a hit to business confidence, impacting on spending. At the same time, tough times demand careful management of risk – it won’t go one way.

An economic slowdown may contribute to rising crime, though Australia’s employment rate is very low at under 3.6 per cent and the nation’s crime rates have reduced decade-on-decade as a result of reduced alcohol consumption, lower levels of social interaction, a greater sense of pervasive surveillance, reduced lead in the environment and other factors.

The curious and recent practise of manufacturers giving their brands to many distributors in a relatively compact market is problematic. Even high-end makers are doing this. At SecTech we saw a large number of disties carrying the same brands. This precludes investment in teams, training and stock – the focus moves to price.

Networked security solutions depend on tight cyber security that some end-to-end systems are not attaining. Networked security solutions incorporate unsecured networked components – switches, routers, mobile devices, laptops, etc. We’ve been lucky not to have major global network hits lately, but these benign conditions can’t be guaranteed in the future.

Worries around AI – consumers are concerned and government regulatory bodies across the world are beginning to act. This may impact on face recognition in CCTV solutions, as well as in access control applications.

The global security industry has failed to engage successfully with government and community around AI – instead of benefiting from collaborative standards, new rules are going to be imposed on us. Given the power of AI, this could represent a huge growth hit.

The potential of digital behemoths to ambush the security market – after failing for years, they will do this in partnerships or through acquisition, not on their own.

The potential of runaway digital development to disrupt the market. IT pundits keep talking about the singularity – a metaphorical point at which technological development gets out of control and runs wild. They are probably dreaming in the sense consumers are cheapskates and market obliteration is not a business model, but it’s something to watch.

IT integrators winning security business as end users increasingly see electronic security solutions as IT solutions. Pay attention, industry associations and licensing bodies.

Lack of training in electrical and networking exposes installers and users to greater risk.

Conclusion

There’s a lot to think about in a SWOT analysis – and when you’re considering layers of an entire industry those considerations become more complex.

Suppliers needs to invest in technologies that are dependable, well supported and enjoy loyal support. You also need to focus on brands and technologies that deliver clear benefits and efficiencies, and that have a guaranteed future.

As well as offering customer’s amazing security and automation solutions, finding ways to save them money is going to be important through 2023. That might include allowing them to reduce energy costs, to take advantage of automation, and to better predict risk and sales opportunities via retail AI.

Keeping customers close is going to be important and leveraging the industry’s latent strength in relationships, as well as its position at the cutting edge of hardware and software technology will be vital, too. The electronic security industry is robust, light-footed and clever – we’ll need to be all of those things and more over the next couple of years.

You can read more SEN news here!

“Electronic Security SWOT Analysis Released.”

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AUTHOR

John Adams
John Adamshttps://sen.news
A professional writer and editor who has been covering the security industry since 1991, John is passionate about clever applications of technology and the fusion of sensing and networking. A capable photographer John enjoys undertaking practical reviews of the latest electronic security systems.

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