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Alarm Industry Legal Expert Jeff Gorelick Shares 2012 Predictions for Security Business

More than 25 of the most prominent people in the industry rendered a deep and sweeping portrait of the impending security landscape for SSI's 2012 Industry Forecast. Here, Jeff Gorelick, managing partner, Gorelick Advisors Law Practice, addresses the most significant challenges, changes and…

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What does 2012 hold in store for your business and the industry? Find out with the many insights offered in SSI‘s annual Industry Forecast, which is featured in our January issue. This year, more than 25 of the industry’s most prominent research firms, trade associations, business and finance specialists, systems integrators, manufacturers, consultants, and alarm companies rendered a deep and sweeping portrait of the impending security landscape. The participants addressed the most significant changes, challenges and opportunities they anticipate taking place during the next 12 months in seven critical areas. They are: security technology; security markets; security industry; business and operations; politics and legislation; risks and threats; and ongoing challenges. With the boundaries of print being too constrained to present all of the fascinating and valuable assessments, each of the respondents’ complete, edited interviews are being offered exclusively online. Happy New Year!

Jeff Gorelick
Managing Partner
Gorelick Advisors Law Practice

Security Technology

Jeff Gorelick: Operating companies have an increasing awareness of the return on investment in electronic security. Our clients servicing large industrial and warehouse facilities have had greater success selling integrated remote video monitoring together with internally monitored algorithmically based video software. It results in the reduction in shrinkage of small high value items and the ability to avoid unsubstantiated workers comp claims. The continued advancement of these commercial technologies provides a good opportunity for expansion as capital budgets return to normal levels.

Security Business and Operations

Gorelick: Larger companies that provide more robust menus of integration equipment and services will have an increasing marketing advantage over the smaller provider with a more limited set of offerings. Smaller companies will find themselves competing in primary and secondary markets for the business that the larger companies cannot do as profitability or having to develop partnering strategies to offer the products and services demanded. In the past year we have seen several of our local and regional companies close down their central monitoring stations. They had previously competed effectively on the basis of “local monitoring.” The capital investment required to offer the customer the scope of services would cut margins. As a result they have moved their business to high quality and sophisticated contract central stations.

Security Industry

Gorelick: The overlap of physical security and data protection brings competitors from the IT world into direct competition with tradition systems integration and electronic security companies. Whether it is Intel, Cisco or others this new competition will over the next few years call upon electronic security companies to increase their ability to compete in data security and compliance issues.

Politics and Legislation

Gorelick: After years of fighting alarm ordinance battles city by city, I believe the industry has turned the corner in creating a balance between customer needs and police resources. The Security Industry Alarm Coalition has shown flexibility in dealing with police organizations and demands of cities with shrinking budgets. New verification techniques, more foolproof panels and greater customer education will continue to help us avoid the pressures to further diminish police response.

Risks and Threats

Gorelick: The smaller dealer who always believed his/her company was their nest egg and who continue to do business as usual selling limited product offerings are likely to find decreasing multiples. The public demand for more sophisticated and integrated services will create greater stickiness for companies who service the demand and a greater level of attrition for those who do not. These smaller companies are likely to lose market share or even shrink materially if they are not responsive to the changing market.

Ongoing Challenges

Gorelick: The development of standards remains a slow process hampering the growth of new and desired products in both the fire and security areas.  

Projecting 2012

Gorelick: I think 2012 will be an excellent year as enhanced technologies encourage customers to upgrade their systems and services. I predict a greater amount of M&A this year as strong companies use low interest rates to acquire weaker competitors.

Final Thoughts

Gorelick: It is an election year and the posturing of the political parties will once again disable government functioning. Markets hate uncertainty and this may have some offsetting effect on capital investment.


Article Topics
Business Management · Exclusive Web Features · Industry Forecasts · 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.
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