It’s safe to say that the Middle East security market is set for growth in the next couple of years, due to various economics- and events-driven initiatives for example Saudi Vision 2030 and Expo 2020 Dubai. A market research by Frost and Sullivan points out that overall, the Middle East electronic security market is expected to grow at a CAGR of 16.5 percent between 2017 and 2022, from US$2.6 billion in 2017 to $5.6 billion in 2022.
Despite the Middle East’s growth potential, doing business there isn’t all smooth sailing. Security companies are still faced with various challenges. Tensions between the GCC countries tend to result in political instability and uncertainty which bring negative consequences to the business community. Fluctuating oil prices can affect the local economy and users’ willingness to spend. These trends, coupled with intense competition, add to the difficulty of doing business in the region. To overcome these challenges, Security players push higher-level service and solutions to give more value to users and solve their security and non-security needs.
Understanding the market
As the Middle East has a unique set of characteristics, doing business there requires an understanding of the local culture and practices. “The massive investment in building and infrastructure does not automatically mean that business can be won easily. The market has to be thoroughly understood and any sellers have to have a local presence over the long-term,” said Alastair McLeod, Group CEO of
Veracity. “We have founded a new subsidiary company in Dubai and recruited local sales and technical support staff, as well as sending staff out to Dubai from the U.K. to run the business. This involves considerable investment but it is the only way to properly support our customer base in the GCC and elsewhere.”
Meanwhile, like other markets in the world, competition in the industry remains tough, too. Users are also more or less price sensitive. While oil prices have somewhat picked up a bit from a slump over the past few years, they can still be fluctuating, impacting the pace of project rollouts. One way to overcome these challenges is to win customer trust with reliable products and value-added support.
“It is still important that we increase brand awareness into the market, and for Paxton this includes the promotion of our five-year product warranty, free installer training, free software updates and free technical support,” said David Sodergren, Regional Sales Manager for Middle East at
Paxton. “This gives the end user/SI confidence in the product that they are purchasing, as well as supporting the project by working hand in hand with them until complete customer satisfaction.”
Focus on higher-end segment
For some players, concentrating on the higher-end customers is one way to offset the effects of project delays or cuts from other segments. “We have noticed that the budgets for certain projects have been cut because of the fluctuation in oil prices. So, we have focused more on the upper segment of the market – that is, the high-end security projects such as critical infrastructure and promoted our integrated solution to this sector, as those projects seem to have better funding. The fact that our fiber optic sensors, laser sensors, infrared beam towers and external PIRS are available as IP/PoE and integrated with all the major video management software (VMS) platforms proved a significant advantage in making security systems easier to install and more reliable in operation,” said Gaurav Mahajan, Divisional Manager for Middle East at
OPTEX.
And inevitably, security players are pushed to roll out non-security applications in different vertical markets to suit the user’s management and operational needs. “Increasingly, end users in the ME are using surveillance for more than just security. For example, oil and gas facilities are utilizing video surveillance for process monitoring and flare monitoring applications. With the transition into IP systems and increased usage of video analytics, video surveillance systems are being leveraged to increase operational efficiency of organizations, particularly in the retail & hospitality sectors,” said Pradeep Nair, Regional Sales Director for Middle East and India at
Pelco by Schneider Electric.