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Adriatic security market marked steady growth in 2017

Adriatic security market marked steady growth in 2017
Following the economic downturn of 2008 and subsequent long-term recovery, the Adriatic region's security market has recorded steady growth for yet another consecutive year.
Following the economic downturn of 2008 and subsequent long-term recovery, the Adriatic region's security market has recorded steady growth for yet another consecutive year. This is the result of the recovery of local economies. Stable growth has been achieved together with higher investments and the market is increasingly looking for advanced and better integrated solutions.

The security market of the Adriatic region countries has already made a step forward in emulating the practices used in more developed European markets. "Entire Adriatic region reacts to the market changes in the manner which is similar to that found in the Western Europe. Great growth is observed following stagnation,” said Sergej Pičulin, Regional Sales Account Manager for Central and Eastern Europe, Russia and the CIS at IndigoVision.

Grega Grušovnik, CEO of Slovenian Jantar company, agrees with him: “Growth is noticeable, and it has carried over from 2016 to an even greater extent. The growth trend resulting from the end of recession and the general growth in the EU is noticeable in Slovenian and international market, particularly in the Adriatic region.”

Urška Binter, Sales Director at yet another Slovenian company Prima Sistemi, says that their growth amounted to about five percent, primarily due to increased demands on the part of individual clients, such as hotels, housing owners etc.

One of the Most Successful Years

Miroslav Ćirić, Head of Export Project Sales at Alarm Automatika, notes that the market has even recorded a “double-digit” growth at the regional level.

According to Matija Mandić, Head of Technical Security and Passive Network Solutions at KING ICT, the reason for seeing positive trends in terms of technical security growth is “better investment climate and increasing presence of capital from the EU funds”.

The Croatian market is making progress, yet at slightly lower rates, we are told at ECCOS Inženjering and Protekta. Owner of Protekta Duško Bjelotomić explains this: “Croatia, as well as other regional countries, once again record slow but steady growth of investments in the security in the broadest sense. After the crisis caused by general economic downturn which took place ten years ago, now you have slow but steady growth of investments in this sector. Exceptional growth in specific segments occurs only when the state and its regulations or new laws create the uncommon demand for investments in order to ensure compliance with a new law. This practice is common to all countries of the Adriatic region.”

Andrej Ćuraković, Head of Sales for Balkans and Central Europe at Avigilon, confirms the existence of the positive growth trend in this country and the Adriatic region. For him, 2017 was one of the better years. “I would rate 2017 as one of the most successful years for Avigilon in this region.”

Politics as an Obstacle in BiH?

When it comes to Bosnia and Herzegovina, growth is somewhat slower due to complex political situation and administrative complexity. “According to the Global Competitiveness Index of the World Economic Forum, Bosnia and Herzegovina has jumped four places to rank 103rd globally this year, but it is still the lowest ranking European country here. This small progress is commendable but insufficient. The inadequacy of the state administration, complexity of tax regulations and poor access to finances still act as large obstacles both for having better business and market growth. Regarding the private security market, I would reckon that there were no major disruptions in any segment. However, there is a noticeable growth trend with the demand for security systems in case of natural persons or individuals, which is also expected in relation with the general trend of increasing concerns for personal safety,” explained Bojan Stanojević, CEO of Sector Security.

Daniela Gogić, Marketing and Communication Manager at Securitas BH, agrees with the stable growth assessment, both for this country and entire region. “From our communication with the colleagues from Securitas in the region, we can confirm that the stable growth of the private security market is evident, particularly in the segment of building security. Users of these services are increasingly better informed about features offered by technical security and new technologies and that is why they are asking us to provide that type of security,” says Gogić, adding that her company is proud of the fact that it hired 300 new employees last year.

Prices Must Be Higher

Causes of slow progress or even stagnation can be traced down to economic and political situation, says Ivica Brekalo, CEO of AFP, who also blames “business practices of those who deal with security” since they sell cheaper equipment at the expense of quality. “New technologies are entering the market, but few are those in this business who pay sufficient attention to the quality of equipment and services, so it is customers themselves who do not have the opportunity to understand technology or whatever it is they are buying. In most of the cases, they go for the cheapest option, which, ultimately, does not represent the optimal solution for provided equipment or services. The situation in the region is similar, sometimes better or even worse,” says Brekalo.

Aleksandar Dobnikar, Regional Sales Manager at Sony, argues that the video surveillance market is growing, but its value does not reflect increasing equipment sales. “The reason for this is primarily related to dramatic equipment price drop, which has led to a decline in terms of services. In Eastern Europe, there is a noticeable increase in the sales of cheap equipment, although better and more reliable equipment made by renowned manufacturers still represents an indispensable part of each project in more developed European countries.”

Profiling Professional Solutions

Other interviewees do not share this view of the situation. Andrej Ćuraković, Avigilon’s Regional Sales Manager, claims that “one can observe the re-emergence of the trend of preference for quality, reliability and simplicity instead of going for the lowest prices,” while Aleš Dejak, Regional Sales Manager at Dahua Technology, points out that the progress has been made precisely because of the high criteria and standards that the market imposes: “The Adriatic region is exhibiting growth trend when it comes to security technology. What is especially pleasing to me is the fact that professional approach to security solutions is increasingly becoming the preferred option throughout the region. High level of expertise offered by the companies and personnel that deal with security allows us to fully meet the high criteria and standards set by the market. It is beyond doubt that the technology is changing on daily basis and that life cycles of products are becoming shorter. Security market players have to invest a lot in order to contribute to the technology development.”

In order to meet these challenges and set new trends, Dejak claims that Dahua has been investing more than 10% of its annual revenues for research and development of new products for many years.

Stjepan Šurmanović, Sales Manager for Southeastern Europe at Axis Communications, shares his colleagues’ views. “We believe that our region is definitely an emerging market which has great potential and need for high-tech products and solutions we offer. Surely, there is room for improvement and that’s why we have decided to strengthen our footprint in the region. As a fully open integration platform, Axis symbolizes the absolute freedom given to both integrators and customers in creating their own personalized solutions which are tailored exactly to their desires. With this technology, the user acquires a stable and robust platform which makes it possible to upgrade a project at later stages,” says Šurmanović.

Neven Rusković, CEO of Špica Sustavi, adds: “It is established that the market is growing together with the projects which are becoming more complex as the sign of the times we live in. This is specifically aimed at digitization and modern technology. Some of the most prominent trends are those related to video surveillance software that focuses on object recognition. Also, we are seeing increased use of IP cameras with Ethernet communication.”

Doing Business in Line With the Users’ Demands

Complexity of the projects, increasing numbers of tech-savvy and demanding customers, accessibility of new technologies and their application outside the traditional scope of security have direct impact on the state of the market. This is closely related to the trends that the leading regional experts focus on, such as integration, video analytics and cyber security.

Ivan Špoljarić, Key Account Manager at ECCOS, summarizes these trends in one sentence: “The markets of the Adriatic region are witnessing increasing demand for sophisticated security solutions that include integrated systems, advanced video analytics (automatic number-plate recognition, identification of persons, classification of objects, perimeter protection etc.), advanced alarms and reporting,” adding that one of the trends involves reducing the number of security staff and personnel while retaining or raising the level of security through the use of advanced technological solutions.

Šurmanović adds: “Generally speaking, we think that entire region offers great potential. We want to start discussing topics such as sustainability, cyber security, integration capabilities, video analytics at the edge, ready-made solutions for individual market verticals, total cost of ownership for systems, support… we would like to show why it is crucial for integrators and end users to develop solutions based on the systems that can address these issues.”

Sergej Pičulin shares this view: “Trends that I would surely single out are edge analytics in video surveillance and integration with other systems. These are the added value that almost all of major manufacturers offer today.”

Integration of safety and security systems as a dominant trend has also been recognized as such at Alarm Automatika whose representatives stress that they have developed their ABSistemDCi software for this reason i.e. to address this issue in the best possible manner. At the same time, representatives of KING ICT emphasize that “security system users are increasingly considering integral and proactive concepts of security systems as an effective response to the rising security challenges of today.”

Finally, cybersecurity has certainly emerged as a trend that security experts are increasingly concerned about in the face of numerous hacker attacks which make them ask themselves what to do in case of security system breach and data theft. “A great deal of attention is focused on protection against hacker attacks, given that this is a major issue for almost all cheap equipment manufacturers, mostly those from China. I think that buyers in our region have not yet been sufficiently informed and educated about this rising threat,” says Dobnikar. 
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