With half of 2013 behind us, the forecast for European growth remains conservative. Nevertheless, there are opportunities in the security industry for those who are diligent enough to listen to the market.
The European economy continues on its path of recovery from the economic slump. Within the E.U., the economy is expected to stabilize in the first half of 2013, following the recession in 2012, according to the European Commision's (EC) spring report. The projected GDP growth of the E.U. -0.1 percent in 2013, 1.4 percent in 2014, and 1.2 percent in the Eurozone.
In spite of a fragile and tough European economy, the security market is still seeing growth in certain areas. “The security market in EMEA is challenging, but it really differs from country to country. The market is flat in the southern parts, but growing in double digits in the Middle East, Africa, and Russia. In some European countries, there is slight growth. Although they are not growing majorly, they are growing nicely,” said Gerard Otterspeer, Product Manager for Video Surveillance at Bosch Security Systems.
Several parts of Europe are also starting to look up. “We are also seeing the first 'green shoots' of growth across
Western Europe and specifically in the U.K., Benelux and the Nordics, indicated by a continued increase in sales enquiries since early 2013,” remarked Brian Song, MD of Europe for IDIS, on the recovery of the European economy.
Germany and DACH region
With regards to the strongest economy in the Eurozone, Song noted, “Parts of Germany have not experienced the same level of downturn as its European neighbors although the surveillance market has been somewhat tempered by Germany's increased privacy laws.”
Similarly, the rest of the DACH region is key for IndigoVision in Europe. The company recently announced a major expansion of the sales team serving the DACH region as part of its continuing investment there. According to the company, these markets are known for their demand of technical excellence and impeccable video quality, with key verticals being cities, police, prisons, and commercial industries including prestigious automotive brands.
Slow but Steady Uptake
In the U.K., the uptake of IP is slow but steady. A recent report by IMS (an IHS company) showed that 58.7 percent of the UK's new sales of surveillance systems in 2012 were analog. However, with roughly 4.3 million cameras installed in the country and many of them approaching the end of their life cycle, there is market potential in upgrading and refurbishing.
Hence, Mayflex is doing well in the UK market. “We grew by nearly 30 percent in the electronic security market in
our accounting year that ended in March 2013. We found the market very buoyant in the smaller end. There is definitely a significant growth resulting from the transition from analog to IP. The larger projects are there but in challenging times like this, they are more difficult to close and often delayed,” said Gary Harmer, Director of Sales for Electronic Security at Mayflex.
The education vertical for IP-based systems is large in the U.K. There is a big government initiative in the U.K. on child safeguarding and a principal driver for the installation of security systems is the protection of children and staff. For example, high-definition cameras would be able to clearly depict how a child fell down. Many find that in private schools, they'll typically upgrade the entire system all together, but in academies and universities, they'll upgrade gradually.