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Retail Intrusion Market Roars Back, New Research Shows

SSI's upcoming April issue includes the results of our 2011 Systems Integrator Study. While the expansive report spans eight pages and includes 42 graphs detailing company, access control and video surveillance trends, there was still lots more great data gathered that did not make it in ...



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SSI‘s upcoming April issue includes the results of our 2011 Systems Integrator Study. While the expansive report spans eight pages and includes 42 graphs detailing company, access control and video surveillance trends, there was still lots more great data gathered that did not make it in. But that’s part of what makes online so great, being able to convey even more valuable information.

Following are exclusive statistics gathered from our annual research project, which was conducted with the help of PSA Security Network and Reed/ISC. Specifically, below are select results from the intrusion detection and fire/life-safety portions of the study with brief captions.

INTRUSION ALARM REVENUES BY MARKET
Office buildings                            15%
Retail/Entertainment                   12.8%
Hospitals/Schools/Universities    12.5%
Industrial manufacturing             11.7%
Government facilities                   11%
Residential                                  10.3%
Warehousing/Trucking/Transp.    8.1%
Financial institutions                    7.7%
Utilities                                         5.9%
Gaming/Hospitality/Arenas           3.3%
Mass public Transportation          1.8%

Retail/Entertainment exploded during 2010 according to these results, almost doubling its activity from 6.7 percent a year ago. Hospitals/Schools/Universities moved ahead of Industrial manufacturing.

INTRUSION GROSS PROFIT MARGINS
Security dealers               33%
Systems integrators         27%

While systems integrators’ intrusion gross profit margins remained at 27 percent, they gained 2 percentage points on security dealers as they dropped 2 percentage points.

AVERAGE PRICE CHARGED FOR INTRUSION SYSTEMS
Residential             $1,209
Commercial            $7,420

The amount earned for both residential andf commercial intrusion projects dropped by $377 and $934, respectively.

INTRUSION ALARM MONITORING
Use third-party central station    76.6%
Use own central station              14%
Clients monitor themselves          9.4%

Perhaps as a sign of the economic need to hang onto more business as opposed to outsourcing, the use of third-party monitoring centers dropped more than 10 percentage points. Both keeping monitoring in-house and client self-monitoring rose.

INTRUSION ALARM TRANSMISSION TECHNOLOGIES
                              Integrators    Dealers
Telco landlines        67.7%        73.8%
Cellular                   14.8%        15.2%
VoIP/Internet         13.7%        7.8%
Long-range radio     2.7%        3.3%

Integrators’ use of landlines dropped by about 9 percentage points, with cellular rising some 5 percentage points and VoIP and radio increasing roughly a point a piece.

HARDWIRED VS. WIRELESS INTRUSION
Strictly hardwired    41.2%
Combination            32.9%
Strictly wireless       25.9%

There was little change in this graph, in fact strictly wireless actually declined by about 2 percentage points.

PERCENTAGE OFFERING FIRE/LIFE-SAFETY SYSTEMS
Security dealers          53%
Systems integrators    37%

The percentage of systems integrators offering fire/life-safety systems and services dropped by 7 percentage points from a year ago. Perhaps tough economics have led some to concentrate more on core competencies that in some cases preclude fire business.

AVERAGE FIRE SYSTEM GROSS PROFIT MARGIN
Security dealers           31%
Systems integrators    27%

As with intrusion business, integrators’ gross profit margins stood pat. They gained notably on dealers, however, who saw 8 percentage points chopped off their margins.

KEY FIRE/LIFE-SAFETY SYSTEM NUMBERS
Average commercial system price        $18,452
Average monthly systems installed         8
Average number of smoke detectors     35
Percent including CO detection              11%
Percent that install sprinklers                22%
Percent that sell mass notification         56%
Percent integrating w/building controls 44%

The amount charged per system declined sharply, as did the average number of smoke detectors. The percentage of integrators installing sprinkler systems more than doubled. 

Scott Goldfine

Article Topics
General Industry · Installation and Service · Management · Physical-IT Security Convergence · Blogs · Industry Research · Intrusion Alarms · Managing Your Business · Sales · systems integration · Under Surveillance · All Topics

About the Author
Scott Goldfine
Scott Goldfine is Editor-in-Chief and Associate Publisher of Security Sales & Integration, directing all editorial aspects of the magazine brand in print, electronically, online and in person. The voluminous, innovative and award-winning body of work he has distinguished himself with since joining the publication in 1998 includes groundbreaking research, landmark features, leadership roundtables, high profile case studies, and many industry exclusives. Well versed in the technical and business aspects of electronic security (video surveillance, access control, systems integration, intrusion detection, fire/life safety), Goldfine is a nationally known figure in demand as an industry presenter and subject matter expert to mainstream media. He is responsible for developing many unique products and programs, including the SSI Industry Hall of Fame, Control Panel (industry’s first E-mail newsletter), Police Dispatch Quality (PDQ), Marketing Marvel, Installers of the Year, Integrated Installation of the Year, Security Industry Census, Systems Integration Study, Installation Business Report, Operations & Opportunities Report, Commercial End-User Study and Security’s Fantastic Fleets. Recognized for his relationship building, integrity and lead-by-example ethic, Goldfine is a solutions-oriented team player who advises and collaborates with industry dealer/integrator, consultant, distributor, central station and manufacturer icons, luminaries and executive business leaders on a daily basis. He is also actively involved in several security events and organizations, including the Electronic Security Association (ESA), Security Industry Association (SIA), Security Industry Alarm Coalition (SIAC), False Alarm Reduction Association (FARA), PSA-Tec, SAMMY Awards, International Security Conference and Exhibition (ISC), Electronic Security Technology Summit (ESTS), Mission 500, Electronic Security Expo (ESX), ASIS Int’l, Honeywell CONNECT and other supplier conventions. Goldfine also serves on several boards, including the CSAA Marketing and Communications Committee and PSA Cybersecurity Advisory Council. A certified alarm technician, former cable-TV tech, audio company entrepreneur, and lifelong electronics and computers enthusiast, Goldfine graduated with honors from Cal State, Northridge with a management degree in Radio-Television-Film. His professional media endeavors have encompassed magazines, Internet, radio, TV, film, records, teletext and books. Goldfine resides in the Charlotte, N.C., area with his wife, son and three cats.
Contact Scott Goldfine: sgoldfine@ehpub.com
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Industry Research, Intrusion Alarms, Managing Your Business, Sales, systems integration, Under Surveillance


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