Locksmiths
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 4,000 locksmiths in the US sell, install, open, modify, and service mechanical or electronic locking devices, safes, and security vaults. Major revenue categories include non-residential services, residential services, key duplication, and merchandise resale. Firms may install and service electronic alarm and surveillance systems or provide roadside assistance for locked vehicles.
Staying Current With Technology
Electronic locking technology is changing the security industry and forcing locksmiths to adapt accordingly.
Recession-Resistant, But Not Recession-Proof
While the locksmith industry is considered recession-resistant, an individual firm’s specialty can be sensitive to economic factors.
Industry size & Structure
The average locksmith operates out of a single location, employs four workers, and generates about $675,000 annually.
- The locksmith industry consists of about 4,000 companies that employ about 16,500 workers and generate about $2.7 billion annually.
- The industry is highly fragmented; the top 50 companies account for 23% of industry revenue.
- The industry primarily consists of small, independent operators that serve a local market. Franchises include Pop-A-Lock and Mr. Rekey.
Industry Forecast
Locksmiths Industry Growth
Recent Developments
Jul 22, 2024 - Employment Stable, Wages Up
- Employment by security system services, which includes locksmiths, was relatively stable during the first five months of 2024, according to the latest data from the US Bureau of Labor Statistics (BLS). Average wages for nonsupervisory employees in the industry increased year to date through May 2024, reaching $35.03 an hour. Sales for the US locksmiths industry are expected to grow at a 5% CAGR from 2024 to 2028, faster than the overall economy, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc.
- Tenant evictions, a demand indicator for residential lock-changing services, rose 15% or more in 2024 compared to the period before the pandemic for 10 of the 33 cities tracked by the Eviction Lab, according to the Wall Street Journal. The Eviction Lab, a research unit at Princeton University, reviewed filings over the past twelve months. The research showed that eviction filings in the past year are up 35% or more compared to pre-2020 times, in certain cities including Houston, Las Vegas, and Phoenix. In addition to the Sunbelt region, Columbus, Ohio, and the Minneapolis-St.Paul areas also posted elevated eviction rates. Filings have remained lower in certain cities that have increased protection for renters, including New York City and Philadelphia. The top reason for tenant eviction is unpaid rent, often due to job losses or medical emergencies creating financial hardships. Per the Zillow Observed Rent Index, asking rents for houses and apartments nationwide increased 30% from 2020 to 2023.
- Overall commercial bankruptcy filings, a demand indicator for business-related lock-changing services, grew 39% in April 2024 year over year, according to Epiq AACER. The total number of commercial Chapter 11 bankruptcies filed in April 2024 reached 542, 40% higher than a year ago. Small business filings, captured as Subchapter V elections within Chapter 11, grew 60% in April 2024 compared to April 2023. According to ABI Executive Director Amy Quackenboss, “As interest rates remain at elevated levels and household debts continue to climb, access to the financial fresh start of bankruptcy is key for struggling businesses and consumers. With enhanced eligibility for consumers and small business set to expire at the end of June, we appreciate recent legislative efforts by Congress to maintain greater access to a more efficient process for small businesses and families to restructure their debt loads.”
- The National Federation of Independent Business (NFIB) monthly jobs report shows that unfilled job openings fell in June 2024, with a seasonally adjusted 37% of small business owners reporting jobs they could not fill. The reading is down five points from May 2024. A seasonally adjusted net 15% of small business owners plan to create new jobs over the next three months, unchanged from May. About 19% of owners reported labor quality as the most important problem facing the business. According to NFIB Chief Economist Bill Dunkelberg, “This summer, small business owners continue to try to hire and find qualified employees for their open positions. The number of small businesses with one or more job openings they can’t fill remains at exceptionally high levels. However, owners are raising compensation at historically high levels to attract and retain employees.”
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