Security Guards and Patrol Services

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 7,000 security firms in the US provide security guard, patrol, and related services, including personal and property protection. Security guards are a supplement to public law enforcement, and act as a deterrent to crime. The majority of industry revenue comes from securing buildings and parking facilities. Other services include crowd control and bodyguard services. In addition to guards, firms use electronic security systems or guard dogs to enhance protective services. Firms may provide consulting services, such as security system design or training.

High Cost Of Failure

The nature of the security business puts companies at risk for liability for personal injury, property damage, and financial losses.

Limited Pricing Flexibility

The security guard services industry’s struggle to maintain profitability is complicated by stubborn low growth in pricing.

Industry size & Structure

The average security guard and patrol services provider operates out of a single location, employs 112 workers, and generates $4 million annually.

    • The security guard and patrol services industry consists of about 7,000 firms that employ about 758,800 workers and generate nearly $30 billion annually.
    • The security guard and patrol services industry is concentrated at the top and fragmented at the bottom; the top 50 companies account for 64% of industry revenue.
    • Large companies include Securitas USA, Allied Universal Security, and Canada-based GardaWorld. Some large firms are foreign-owned or have international operations.
    • The industry includes large international companies, regional firms, franchises, and independent operators.
                                  Industry Forecast
                                  Security Guards and Patrol Services Industry Growth
                                  Source: Vertical IQ and Inforum

                                  Recent Developments

                                  Apr 4, 2024 - Steady, Moderate Industry Growth
                                  • The security guard and patrol services industry is forecast to notch steady growth for the next several years following expected sluggishness in 2024. The industry’s year-over-year sales increased by 5.5% in 2022 and 6.3% in 2023, according to Inforum and the Interindustry Economic Research Fund, Inc. Sales growth is projected to slow to 2.7% in 2024, then rise to 4.7% in 2025. The industry will then see stronger and steady average annual growth of about 5.9% through 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
                                  • Security experts and retail trade organizations suggest that a lack of consistent understanding of so-called organized retail crime (ORC) makes it difficult to estimate the scale of the problem, according to Retail Dive. There is often an absence of consensus among individual retail firms, law enforcement, and researchers about how to define ORC relative to ordinary shoplifting. The typical understanding of ORC is two or more individuals stealing from stores and reselling the items. Some security industry insiders suggest retailers have tended to blame inventory shrink – the difference between inventory on hand and inventory on the books – on shoplifting and ORC without adequate evidence. The National Retail Federation has stopped estimating losses from ORC, but suggests it is likely underestimated due to retailers failing to understand ORC might involve their supply chains, such as in instances of cargo theft. Some retailers don’t report non-violent crimes to police, which also makes estimating the impact of ORC more difficult.
                                  • Persistent work-from-home patterns in the wake of the pandemic have contributed to record-high office vacancy rates. In the first quarter of 2023, 19.8% of US office space was vacant, according to Moody’s Analytics. That’s an increase from a vacancy rate of 19.6% in Q4 2023. Weaker office occupancies could reduce demand for security guard services.
                                  • As many US downtown areas experience rising crime, the security guard industry has seen significant growth, according to recent reporting in The New York Times. Private businesses and schools in urban areas are increasingly turning to private security as police and other first responders are often overwhelmed by rising levels of crime, homelessness, drug overdoses, and mental illness. Average police response times in some cities – including New York City, New Orleans, and Nashville – have risen by as much as 50% in recent years as police departments struggle to retain the officers they have and recruit new ones. Some cities are hiring security guards directly to fill their policing personnel gaps.
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