The industry has become increasingly fragmented, as the downturn in demand resulted in worker redundancies
Melbourne, Australia (PRWEB) February 07, 2015
The Fire and Security Alarm Installation Services industry's growth has been limited over the past five years, as it has contended with subdued commercial construction activity due to widespread uncertainty following the global economic downturn. According to IBISWorld industry analyst Anthony Kelly, “the industry has also become increasingly fragmented, as the downturn in demand resulted in worker redundancies and former employees started their own businesses or began to operate as subcontractors.” Meanwhile, major players such as Chubb Security Holdings Australia Limited, Tyco International Pty Limited and Hills Limited have consolidated their positions in the industry through their specialised services across multiple markets. Industry revenue is expected to display modest growth of an annualised 0.6% over the five years through 2014-15. This includes growth of 1.5% to $3.5 billion during the current year, supported by improved demand conditions in the housing and commercial building markets.
The number of industry enterprises has contracted over the past five years and currently totals an estimated 2,950 businesses. This decline has included the exodus of 140 companies over the two years through 2012-13, associated with the scaling back of work on institutional building projects following the completion of the Building the Education Revolution (BER) government stimulus package. More businesses are expected to enter the market over the next five years in response to strong commercial building and apartment construction activity. The improved outlook for key building markets points to stronger industry growth prospects over the next five years. “Profit margins are expected to improve as demand increases and industry operators source products through low-cost imports,” says Kelly. Moderate demand conditions are expected to prevail in the residential construction sector, while contractors face deteriorating demand from the key infrastructure markets.
The Fire and Security Alarm Installation Services industry is characterised by a low level of market share concentration. The vast majority of industry enterprises have a workforce of fewer than 20 people, and many generate annual revenue of less than $200,000. Almost half of the industry's businesses hire no additional staff, operating as sole proprietors or partnerships. The industry has low barriers to entry, as any worker with basic electrical knowledge is able to fit residential homes with fire and security systems. The industry has become further fragmented over the past five years, as the onset of the global financial crisis resulted in many businesses shedding workers. Those unable to find work instead set up their own businesses, reducing industry concentration.
For more information, visit IBISWorld’s Fire and Security Alarm Installation Services industry in Australia report page.
The Fire and Security Alarm Installation Services industry comprises firms that install and repair security systems and fire protection, detection and control systems.
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Products & Services
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