CCTV the state of the industry
Plimsoll analysis have recently produced an interesting report on the financial health of the CCTV and security industry. They carried out an in depth study of 391 leading UK security firms and found that the majority of companies are coming under increasing threat of failure. Their study found that of the 391 companies only 159 were in a good or strong position, a somewhat frightening statistic if you are a CCTV security installer today.
Fierce competition.
The reasons however are clear , fierce competition has driven prices and margins down leaving profits hard to find. Logistics often means cutting engineers is difficult without seriously compromising service levels and those who have tried have and found it impossible to reach industry standards for service and response times and as a result have inevitably lost customers. It is estimated that of the 359 companies included in the survey as many as 33% are actually making a loss and are in danger of takeover or complete failure.
So how can this be addressed? well to be brutal some companies deserve to fail. Installing at a loss, as loss leader in the hope that service incomes will make profits in the end are short sited and simply drive good businesses to the wall . Some of the big boys have been guilty of this during this recession.
Cuts.
Most of the of the more clever players however have simply cut away the excess, driven down stock levels and hung on in there by the seat of their pants. Slowly but surely the CCTV security industry is emerging from the economic downturn, ready to take on the IPCCTV revolution and get back to see strong balance sheets by early 2011.