Economic Meltdown Rocks Security Industry

Author: John Honovich, Published on Feb 08, 2009

This is no ordinary recession. Dramatic and permanent changes have already begun. In conversations with over 30 end users, integrators and manufacturers over the last 2 weeks, the changes are happening faster and deeper than even I predicted a few months ago.  Fundamental assumptions on how to run businesses in the security industry are being permanently overturned. It is critical to understand what is changing and how to respond.

**** ** ** ******** *********. ******** *** ********* ******* **** already *****. ** ************* **** **** ** *** *****, *********** and ************* **** *** **** * *****, *** ******* *** happening ****** *** ****** **** **** * ********* * *** months ***.  *********** *********** ** *** ** *** ********** ** the ******** ******** *** ***** *********** **********. ** ** ******** to ********** **** ** ******** *** *** ** *******.

[***************]

*** *** **** ********* ****** * *** ** ** ******** and ********** ***:

  • ***cutbacks ** ******** *** ****** ********** ******* - amongst end users, integrators and manufacturers. Retail and banking are certainly the most severe with almost daily reports of security and LP managers being laid off. That may expected. However, reports are getting more common about coming or planned cuts even within state and local governments. On the manufacturer side, I would estimate almost 30% of the companies in video surveillance have already started layoffs and/or wage cuts. Amongst integrators, problems with obtaining financing and delays of projects are common-place.
  • ***economic *********** ** ****** *** **** ****** than expected. As most know, the ** *** ********** *.*% ** ** **. ** ***** **** ********** **** ******* ** *** *** inventory *******. *** ******* ** ******** ** ******** **** ******* by ** ***** ******. **** ***** ** *********** ** ****** incredible. *** ******* ********** **** **** ******* **** ** *** in ****** ******** **********. ** ****, ** *** ****** ** this ****, *** *********** **** **** *** ********* ** ***** called**********. ** ******, **** ** *** * ** **** *****. Depsite *** ********** ****** ** ***** ***** ******,************ ** ************ ** *****.

**** ** * *********** ** * *********** ****** ** *** economy ******* ***** ********* ** *** ******** ** *** **** bubble *** *********** ** *** ****** ** *** ********.

*** *******, ******** ****** *** **** ****** ** **** **** (as ******** ** ******* ******** ********). **** ** *** ************ *** ** *** **** *** elimination ** '********* ******' *** *** *** ***** ** **** lending *********. **** ** ***** ******* *** ******** ********** ** economic ******** - *** **** ** ** *** ***** ** come.

*** ***** ***** ****** ** **** ** **** *********** ********** are ***** ***********/********* ** *** ********. *************, **********, ***** *** *** **** **** *****. *******, **** industries *** ***** ****** ** **** ************* ******* ******* ** the ********. *** ********** *** ******* ********** ******* **** ***** problems. *******, * ***** **** ** ***** ******** *** ****** by *** ********.  ********* ***** **** ** **** ***** ******* for ******. *** ******** ****** **** ******** *** ***** **** to***** *** *************** ** ****** ***** **** ** ****. *** ********** ********* are ********* ** *********** ****** ******** **** ******* ****** ***** in ** *** ***** ******* *********** ** ********* **-****. ** course, ** *** **,  **** ********* **** ******** *************** **** ******* ******* ***** ** ********** **** ** *** car *********.

******* ** ***** *** *******, *** ******* **** *** ********* will ******** *** ***** *** **** ****** *** *** ******* that ******** **** ***** **.

**** *** *** * *********** ******* **** **** **** ***** to *** ******** ********:

  • ********* **** ********* *** ***** ****** *** **** ** ****** to ******** ************* **** **********
  • ****** **** ***** **** ****** ******** ******* ** ******* ***** ones
  • ***** ********* ******** **** ** ****** **********
  • ********* ********* **** ** **** **** ********* ** ********* **** now **** *** ******* ** *** *** ********

Sales ***********

***** ************* *** ** * ********* ********. *** ******* ** dropping ** ******* **** ****** *** *********** *** **** ************* need ** ** ****** *** *** ******. ** **** *** a ***** **** *******, *** ***** **** **** **** *** make ** ******* ** ***** **********. ** **** *******, *** will *** ** **** ** ******* **** ************** *** *** many ******** ** **** **** ** *** ******* ****.

* ** ********* ** *** **** ** ** ***** ** manufacturers **** ******* **** ********. *** ********* **** ** ****** out **** ** ** ***** *** *** ** **. **, for **** ********, ** ***** ** ** ************* *** ******** expectations. *** **'* *** ** ** *** ******* **** ** strong ** *** ******.

******* ********* ***** *** ** ** ***** ** ****** *********** that *** ******* ** ******* ***** ********, ***** ************* *** going ** ** *** *******. **** ** ******* (*) *** numbers *** *** ***** *** (*) *** ******* **** *** be ******* ****** *** * ****** ** ******** ** ****. Furthermore, ******* ** *** *********** ** *** *******, ********* **** be *********** ******* ****** *** ***** ****** ******* ** *** time ** ***** *** ***** ****** ** **** **.

*** ** **** **** **** **** ********* **-***** *** **** organize ***** *** *********. *** ******** ** ***** *****, ******** contact, ****** *** *** **** ** **** ******** **** **** significantly. 

** *** *** ** ****, * ******* ****sales ****** **** ** ******* ** **% ******** ** **** ******. Growing companies will hire less, shrinking companies will either cut back to reduce costs or be driven out of business because they were not aggressive enough to cut costs.

***************:

  • **** **** **** ** ***** ****** ****** **** *****. ***** is ** ********* ******** ** ****** **** *** ******* ***** around ** * *** ****** ** *********. 
  • ********* ***** ********** *** ******* ********* ** *** ***** *** the **** *** ***** ********* ***** **** **:
  • ** **** ******** ** ********** *********. ***** ****** **** ** have ***** ****. **** ** ***** ** **** ***** *** can *** *** *** ** ******** ** * *********.
  • *** **** ** ******** ******. * ** *** ********** *** to ** ** ******* *** ** ******* ***** *** ********** you **** ** *****. *** *** ************ ** ** ***********.
  • ******* ****** ****** ** **** ***** *** **** ********. **** it **** **** *** ********* *** ********* ** ***** ** much ** ******** ******* *** ****** ** ******** **** ******. A * ****** ***** ******* **** *** ******** *** **** you **** ** ********* ** ***** **** ******** *** ***** deliver **** *** *******. ******** ****** *** ******* ***** ******** visits *** ****** ******** ******* *****.
  • *** *** ******** *** **** ******* ** ** ***********. **** my ******** *************** ** *** ********* **** ****** *********.

**** **** ********* ******* ******* **** ** ***** *** *** economy ***** *********, ********* **** ** ** **** ******* ***** how **** ******** ***** *** **** ******* **** **** ** make.

Importance ** **** ******

*** ******* ** *** ****** ***********, ******** ****** ****** ** security *** ************* ********. ********* *** *** ******* ** ***** off **** **** ******* ** ******* ****** *** **** ****** quality ** *** ******.

* *** **** ********* ** *** *** ******* **** *** happening. ***** * *** ******* *******, * ******* *** ** ******** ******* *** ************* ** see *** ***** *** ******* *** **** ****** **. *** themes * ***:

  • ****** *************' ****** **** ******* **** ******** **** ****
  • ******* *** ************ **** ******* ****** ******** *** ******** ****** out ** **** ********* ********

** ****** ** ******* **** **** ***** **** ******** *** grow **** *** ****** ** **** ****. **** *** **** to *** ******** ** *** **** **** ***** ****** ** 2010 *** ****?  ** * ****** ** *** ******* ** this ******, * ***** **** ***** **** ******** *** *** will *** ******* *** ****** **** **** ** ****** ******* products. 

** ***** **** *** ****** ** ****** ** *** *********. The ****** **** *****, *** **** **** **** ****** ********* emotionally ** **** ** ***********. ** ********* (*** ******) *** emotionally **** *******, **** **** ********* *** ************** ** ****** price, **** ****** ********.

***************:
  • ********* ****** ** *** *** *** ******** ** ***** *** of **** ******** **** ********* ** *** ****** *****
  • ** ******** ***** *********** ******** **** ***-****, **** **** *** features 
  • ***** ** ******** **** ****** *****
  • ***** ** ********** ******** ** ****** ***** *** (*** **** point)

Customer ******** ** ***** ********* ********

****** ******* *** ******* * *********** **-********** ** ***** ********. A ******** ***** * **** ** *** ******** *** ******* remaining ********* ** ** ******** **** *** *** ************* *** no ****** ****** *** ***** ** ******** **** ********** ***. Moreover, *** ********* ************ ** *** ************ ** ******** ** rise ************* **** ****. ****, ********* *** ****** ********* ** hire **** **** *** ******* ****** ** *******. ** ****, the ******** *** ********* ********* ** ** **** **** **** grow *** **** **** *** *****.

** ************* ******** *** ********, ** ********* ****** ***** **** be *** **** ******** ***** *** **** **** *** ******* hold. *** ********, *** **** ** ***** ** ** ******** in * ******** *******, *** **** ****** *** ******** ******* will ** ****. ****** *** **** ** * *******, ******** will ** ************ ** **** ******* *** **** ******** *********. This ** * ***** ********** ** ** ********** ******** **** **** * ********.

***************:

  • *** ***** *** *********** ****** ** **** ******* ***** *** level ** ********** *** **** **** ******** ** ******* ******.
  • ******** **** *** ********* *** ****** ************, ******* ***** *** maintenance **** ** *******.

Terrorism *********

*** **** ** *** **** ******, ********* ******* ********* *** been *** ******* ***** ** *** ******** ********. ** ** essentially * ******* *** ** **** ************* ********** ****** * single ****** ** ******.

*************, *** ******* *** ******** ********* ** ***** #* *** most ** *** *****. ******* ** ****, ***** ** *****, the ********** ** *** ***** ** ********* ***** **** ** replaced ** *** ********** ** ******* ** *** ******** ******. Most ****** **** *** *** ********* ***** ** ****** **** or ******** ** ************* **** *********** **** *** ********** **** abstract ***** ** * ********* ******.

**************: ******* *** *** * ******** ******* *********** *** ******** ******* or * ******* ******* ********, *** **** ** ********* **-***** your ********* ****** *********. **** ******* ******** ** ******** ***** are *** **** ****** ** ** ******** ** *********.

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