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 Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 6,800 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 111 workers, and generates $5 million annually.

    • The security guard and patrol services industry consists of about 6,800 firms that employ about 757,600 workers and generate about $35 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 North America, Allied Universal Security, and G4S (formerly Wackenhut). 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

                                  Coronavirus Update

                                  Nov 19, 2021 - More Offices Reopen Amid Drop in Delta Cases
                                  • The rapid spread of the Delta variant of the coronavirus during the summer complicated many firms’ plans to welcome workers back to offices. However, infection rates began to slow in mid-September and more companies are bringing employees back, according to The New York Times. The share of employed people who worked from home at some point during the month hit a high in May at 35%, according to the Bureau of Labor Statistics. In October, the percentage fell to 11%, marking the lowest level since the pandemic began. A more widespread reopening of office buildings and other workplaces could boost demand for security guard and patrol services.
                                  • To combat the spread of Delta, some state and local governments have reimposed mask requirements and proof of vaccination for some indoor businesses including restaurants, gyms, and movie theaters. To prevent their employees from having arguments with customers over masks and/or vaccine requirements, businesses may hire additional security staff to enforce their COVID-19-related health and safety policies.
                                  • While Delta fears have eased, 90% of small business owners in the US and Canada say they are concerned that inflation will impede their ability to recover economically from the pandemic, according to the November 2021 Road to Recovery Report by Alignable, a social media outlet for small business owners. Nearly three-quarters of small business owners have yet to fully recover, and only 27% report that they are at or above pre-COVID-19 revenue levels. A slowdown in small business growth could reduce demand for security guard services.
                                  • The office space market is beginning to show signs of recovery, which could help revive demand for dry cleaning services. US office asking rents in September 2021 were 1.2% higher than they were the same time a year earlier, according to CommercialEdge’s National Office Report. The US average vacancy rate in September was 14.9%, down from 15.4% the prior month. US construction spending for offices was up 0.2% in September compared to August but declined 3.2% compared to September 2020, according to the US Census Department.
                                  • Security services firms, which includes staffed security, saw 2020 organic revenue growth between flat and 5% over 2019 levels, according to an April report by S&P Global. Security services related to COVID-19 screenings have helped contribute to higher demand and revenue for some companies. S&P Global projects that security services revenue in 2021 should grow at similar levels to 2020.
                                  • In September, the Biden Administration announced that businesses with more than 100 employees will have to require their workers be vaccinated or be subject to at least weekly COVID-19 testing, according to The Wall Street Journal. The requirement will be implemented through a temporary standard issued by the Labor Department’s Occupational Safety and Health Administration (OSHA). The temporary standard went into effect on November 5 and compels affected companies to require their employees to be vaccinated by January 4 or face testing and masking protocols. On November 6 the 5th US Circuit Court of Appeals temporarily blocked the OHSA rule due to potential “grave statutory and constitutional issues.” More than two dozen states, business groups, individual businesses, labor unions, and religious organizations have sued to block the OSHA rule. Due to lawsuits in several circuit courts, federal law requires them to be consolidated and heard in a single court chosen by lottery. In mid-November the lottery was held and the case is to be heard in the 6th Circuit Court of Appeals. The case is likely to ultimately end up before the Supreme Court. Despite the pushback in the courts, many companies are expected to comply with the OSHA rule to keep workers and customers safe, according to NPR. Nearly 18% of the more than 9,700 security guard and patrol services establishments in the US have more than 100 employees, according to the US Census Bureau.
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