Malaysian economy is definitely not at its best at the moment. But being a young market, the Malaysian security industry’s growth potential in the long run cannot be denied, and this is driving international solution providers to the country.
It’s definitely not the best of times for Malaysia. The oil prices are down, its major trading partner, China is struggling with its economy, and local politicians at the highest level are squabbling over corruption allegations.
It’s no surprise then that local businesses across sectors are concerned about the future. At least in the short to medium term there aren't any reasons to cheer.
But being a young market, the Malaysian security industry’s growth potential in the long run cannot be denied, and it is this silver-lining that’s driving more and more international solution providers to the country.
Global companies positive on investing in Malaysia
International companies see Malaysia as an
ideal launch pad to rest of Southeast Asia.
The short-term weakness of the Malaysian market cannot be ignored, but for major international security manufacturers, the country still has a lot of room to grow. Moreover, it is an ideal platform for them to use as a launch pad to the rest of Southeast Asia.
“I think at this point globally the economy is on the slower side, and Malaysia is just taking a harder hit because of the steep currency drop,” said Seelan Kandasamy, GM and Country Head of System Solutions for Panasonic Malaysia. “The market is still moving in a positive direction, but at a slower pace. Projects are there, tenders are there, but awards are delayed.”
To Abhay Joshi, Business Manager for International Security Sales at Matrix Comsec, every country goes through such difficult times once in a while. Matrix is just entering the Malaysian market, and to Joshi the fact that they are entering at a stage when the economy is on the weaker side is only beneficial.
“It is like a stock,” he said. “When it’s down, you start buying it. If you typically look at the market cycle, when the economy goes down, the investments start pumping in to revive it. There is always some or other measure from the policy decision makers to ensure that growth picks up.”
He added that they had had a similar experience before in Dubai market, which was down when they entered it. During the slow period sales and revenue could be low, but it is the right time to jump in, and reap the benefits when things start looking up. “When the economy is up, you’re probably a bit too late to get into the market,” he said.
Another company that intends to expand their presence in the Southeast Asian market is UK-based Pyronix, an intrusion alarm products manufacturer. Hassan Uddin Ahmed, International Sales Manager for MEA at Pyronix said that even though the Malaysian market looks down at present, they see its long-term growth potential and believe it’s worth investing now.
Marc Chan, Business Development Manager for Security in Asia Pacific Region at FLIR, said that his company has managed good performance in the country, although the future is uncertain. Thermal cameras, which are the company’s specialization, are expected to be more in demand in the country as its infrastructure develops.
“We receive very good feedback from our customers [in Malaysia],”Chan said. “Several end-user customers are very keen to explore our technology.”
A growing market stumbling on the way
At this point the Malaysian economy is struggling to get back on track, but as most industry players have pointed out it’s only a matter of time before things get better. But what worries many local businesses most is the uncertainty on how long they will have to wait for it.
On the other hand, as some international companies have pointed out, this is a good time to invest in the market, so that they can benefit when the market inevitably picks up. No doubt this is the right strategy at this point, given Malaysia’s proven growth potential. It would also bring in a much needed positive outlook to the market that could lift the overall sentiments vital to economic growth.