Security System 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 5,800 security systems service providers in the US design, sell, install, service, and monitor security alarm systems. Companies may install stand-alone systems or offer monitoring services. Customers include residential, commercial, educational, governmental, and industrial accounts.
Customer Attrition
Failure to retain customers is costly, as companies typically incur acquisition expenses and depend on payments over the term of a contract to recoup costs.
Technology Integration
Advances in technology help drive popularity for integrated security systems that combine multiple features, such as video surveillance, intruder detection, alarm systems, and home control.
Industry size & Structure
The average security systems services provider operates out of a single location, employs 21-22 workers, and generates $4-5 million annually.
- The security systems services industry consists of about 5,800 firms that employ about 125,000 workers and generate about $28 billion annually.
- The industry is concentrated at the top and fragmented at the bottom. The top four firms account for 34% of industry revenue. The top 50 firms account for 58% of industry revenue.
- Large companies include Apollo Global (ADT) and Monitronics (Brinks Home Security). Large companies may be vertically-integrated and have international operations.
- Estimated US household penetration of alarm systems is 50%.
- The industry includes national and regional chains, franchises, and independent operators.
Industry Forecast
Security System Services Industry Growth
Recent Developments
Jan 10, 2025 - AI to Drive Security Innovation
- Security system services insiders expect AI to play a significant role in industry advancements in 2025. Key innovations include leveraging AI to integrate remote video monitoring (RVM) systems and analytics with access control, alarms, and environmental sensors to provide more comprehensive security services. Current capabilities of AI-enabled systems include distinguishing between human motion, vehicle movement, and movements caused by environmental factors. The next advancements in AI-driven systems will be determining how to respond to what’s been detected by RMV systems, such as providing a vehicle’s color or a description of a suspect’s clothing. Machine learning models are expected to refine these capabilities over time, including analyzing outcomes, to improve future responses and deterrence.
- Incidents of shoplifting appear to be on the rise, according to two studies released in November by the Council on Criminal Justice (CCJ). However, due to different data sources – two within the FBI – getting accurate data is challenging, according to reporting by Retail Dive. In the first half of 2024, shoplifting in 23 US metropolitan areas increased 24% compared to the same period in 2023. FBI data shows conflicting pictures of the state of shoplifting in the US. The Bureau’s Statistics from the Summary Reporting System suggest current shoplifting rates are about even with 2019 levels. However, the FBI’s National Incident-Based Reporting System (NIBRS) shows that shoplifting has risen 93% since 2019. The CCJ notes that the NIBRS is the newer system, and more agencies are beginning to report into it, which could be spiking the numbers. The CCJ suggests that the Summary Reporting System is likely the most accurate measure of shoplifting activity for now.
- The recent What Home Buyers Really Want Study by the National Association of Home Builders highlights some security and energy efficiency home technologies that are most attractive to prospective home buyers. Study participants were given a list of 19 technology features and were asked to rate each as essential, desirable, indifferent, or do not want. Some of the top security features most desired by prospective homeowners included security cameras (76% of buyers ranking desirable or essential), video doorbells (74%), wireless home security systems (70%), lighting control systems (63%), and wired home security system (61%).
- The troubled office space market may be turning a corner as major companies require workers to spend more time in the office, according to The Wall Street Journal. Amazon, Dell, and 3M have recently issued requirements for more office time for some of their teams. In the third quarter of 2024, a third of all firms required workers to be in the office five days per week, according to workplace strategy tracking firm Flex Index. The push for more in-office time comes amid a cooling of the US white-collar jobs market, which has shifted the balance of power back to companies. While industry observers doubt if workplace occupancies will ever return to pre-pandemic levels, some believe the market may have finally hit bottom. In the second and third quarters of 2024, the amount of occupied office space has remained stable after eight consecutive quarters of contractions, according to data firm CoStar. Office occupancy is a key demand driver for commercial security system services.
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