According to the statistics of the Security Industry Association, there are currently more than 30,000 security enterprises in China, with about 1.5 million employees. The total output value of the security industry has reached 320 billion yuan, of which 140 billion yuan is the output value of security products, and 180 billion yuan is security engineering and Service industry; the industry's realized value added is about 115 billion yuan. After more than 30 years of development, China's security industry has grown from scratch, from small to large, and is currently attracting numerous domestic and international security companies with its huge and active market demand. A new round of economic cycle will lead to this, this article takes the industry business model as the main line to explore the development status and prospects of the security industry.
Security industry enters another stage of rapid development
With the continuous growth of the international and domestic security market, the increasing demand for security and fire protection products and services, and the continued support of the national government for the security and fire protection industries, in 2013, security construction gradually entered the construction peak, in a new round of peace. In the urban construction, the industry value chain moves down, the application integrators increase their voice, and the security application enters a period of rapid development. The security industry is welcoming a new round of boom.
According to the "12th Five-Year Plan for Development of China's Security Industry", during the "Twelfth Five-Year Plan" period, the security industry will achieve the overall goal of doubling the industrial scale, with an annual growth rate of around 20%. In 2015, the total output value reached 500 billion yuan, the added value was 160 billion yuan, and the annual export delivery value reached more than 60 billion yuan. China has successively introduced various standardization and compulsory policies in security construction, which greatly promoted the demand for security and fire protection industries.
Security industry forms a unique business model
After years of development, the security industry has begun to take shape, and it has also formed a unique business model. There are three main business models in the security industry: one is based on products, the other is system integration, and the third is service.
First, the business model is based on products
The entry threshold of this model is relatively low, mainly for the large-scale manufacture of security products (cameras, detectors, alarm hosts, etc.), the products are scattered, and the homogenization is serious, the competitors are more, the market competition is very fierce, leading to industry profits. The rate is low, but the profit margins of different grades are quite different. The profit margin of high-end products is high, and the profit margin of low-end and mid-end products is low due to fierce competition. The market size of such enterprises is the second largest market in the domestic security market after system integration. The product-centric business model has lower and lower profit margins, and more and more counterfeiters and followers. Although the market is large, there are fewer companies that can earn excess profits.
Second, the business model is based on system integration
Under this business model, security companies provide product solutions, system solutions, industry solutions and integrated solutions. This business model is characterized by a high degree of IT, a large impact on software, a huge investment in R&D, and a core technology of its own. Because there are very few companies that can master core technologies, invest huge R&D funds, and provide complete solutions, there are few competitors in this model, and such solution providers are gradually emerging in China. This business model is highly targeted because of less competition, so it can obtain higher profits. The industry profit margin is usually 25%-35% or even higher.
Third, the business model is based on service
The high degree of IT in the security industry is naturally indispensable. The security system is a one-time construction project. After the warranty period, it is necessary for continuous service to operate normally, thus bringing a huge service market to the security industry. The services of this business model mainly include: consulting services, design services, supervision services, training services, alarm services, maintenance services, and so on. In addition, with the emphasis on security by merchants and households, integrated security custody services have begun to prevail in the country and have grown rapidly. The profit margin of the service-centric business model is the largest, and the industry competition is also the smallest.
In recent years, with the continuous strong urban-level security demand and the development of civil security as represented by the construction of safe city and emergency command system, a new business model has emerged in the industry, namely the comprehensive operation mode of the whole industry chain. . Security companies adopting this business model are mostly foreign, but many companies in China have been actively exploring them. Among them, Zhongan Consumer Technology Co., Ltd. (hereinafter referred to as Zhong An Consumer) is at the forefront of the explorers. According to the relevant person in charge of Zhongan Consumer, the company can not only provide users with the required mainstream security products, but also provide customized solutions, engineering installation and follow-up operation maintenance services for users, and even according to customers. Requires to provide customers with one-stop integrated security hosting services. In a word, this business model can meet the needs of all types of users.
We believe that security companies that adopt this kind of business model have not only acquired much higher profits than traditional security companies, but also established higher competition barriers for other single types of security companies due to their comprehensive comprehensive competitive advantages. Effectively slow down the degree of competition of enterprises and create a good external environment for their sustainable development. It is foreseeable that such comprehensive security companies will have more development prospects.
Opportunities and challenges for future security companies
Although there is huge potential for growth in the security industry, for industry companies, increasingly fierce market competition has become a reality that has to be faced. According to relevant statistics, the number of domestic security enterprises is more than 30,000. In the domestic security market, especially in some market segments such as video surveillance, the competition has reached a feverish level. How to grasp the development opportunities of the industry is becoming bigger and stronger, and Stand out from the fierce competition has become a difficult problem for security companies to think about and solve.
In the next few years, the domestic security industry will maintain an annual growth rate of at least 15%. In 2015, the total output value will reach 500 billion yuan, which highlights the huge space and prospects of the domestic security industry on the one hand, and the increasing competition in the industry on the other hand. It is confirmed that with the continuous maturity of the security monitoring industry, the domestic video surveillance industry will develop towards a highly centralized and standardized market, presenting the characteristics of the rise of brand enterprises and the small and large manufacturers. In the future, based on the promotion of large-scale networking and high-definition generation, it will release huge market space for security enterprises, and will also promote the development of security industry towards standardization and centralization. For enterprises that start early and have high-definition R&D accumulation for many years, Relying on years of technology accumulation and continuous innovation of research and development strength, we will have a huge space for development in the future.
Due to the high concentration of the market, enterprises have more energy to focus on the areas they are good at, and enterprises can form a good relationship of cooperation and sharing. Under the good atmosphere of cooperation and win-win, enterprises can achieve rapid development. Opportunities can provide more excellent products for the market and users. In the future, the competition among enterprises will be more competition for R&D strength. If enterprises want to win the competition, they must base their research and development on core technologies and promote product performance and technology application with strong R&D capabilities to meet the increasing demands of users.
For the opportunities faced by security companies, the industry said that security monitoring has been welcoming a very good development period in the past two years. On the one hand, networked and high-definition technologies have brought about changes in products, solutions and application models, and promoted the new one. Round growth. On the other hand, the government has continued to grow in this area in recent years, so the whole industry presents a thriving scene. This is a good opportunity for enterprises. However, the threats behind it cannot be ignored. Industry growth masks the development of enterprises. Many problems, every security company feels that the market is good, it is often easy to blindly expand on the scale, while ignoring the most fundamental things - technology accumulation and product development.
The result is that once the industry slows down or an industry recession occurs, the consequences can be imagined. Although Kodak has consistently achieved doubled growth in security monitoring in recent years, it is more focused on its own advantageous industries, steadily expanding new industries, and continuously increasing the research and development of basic technologies and basic products to solve the business needs of customers. It is Kodak's development strategy that will continue to be maintained in the next few years.
In the field of video surveillance, competition will first be manifested in the competition of equipment represented by product performance and quality. The high-definition and intelligent process will provide a favorable opportunity for domestic first-line equipment manufacturers to expand the gap between small and medium-sized competitors. The requirements for security companies are becoming more and more high, and the competition in the industry will definitely intensify. If enterprises want to develop in the competition, they must first improve product quality to win users, and secondly, they need to launch different markets. The corresponding products and solutions. In the future, Hanbang Hi-Tech will comply with the development trend of high-definition and intelligent video surveillance, accelerate the development of new products, expand product production capacity, continuously pursue and improve quality, and gradually complete the overall solution from product suppliers to customers. Comprehensive security supplier transformation.
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