During the last 4 months Covid-19 has created an economic tsunami across the world, and in its wake has caused a reduction in demand for physical security products during the first 4 months of 2020.

Memoori’s annual world report on the Physical Security Business has over the last 12 years shown that only in 2 years 2008/9 during the financial crisis has demand for physical security products declined. The total value of world production of Physical Security products at factory gate prices in 2019 was $34.31Bn, an increase of 8.5% on 2018 whist the compound annual growth over the last 5 years was 7.24 % and 6.27% over the last 12 years which includes the economic world crisis of 2008/9.

This proves that the Physical Security industry supplies products that provide a valuable and vital service and delivers a return in a relatively short time. It has proven that it is a very robust business that can survive in difficult economic times.

In the last 4 months demand has declined significantly and until a vaccine is discovered (or effective therapeutics) we cannot forecast the sales of Physical Security products for 2020 other than it will be a significant decline on 2019; Optimistically not more than 20% and return to growth by the 2nd quarter of 2021.

COVID-19 is already forcing companies to radically rethink how they operate their business in particular controlling their cash flow and getting a balance on financing the company more conservatively between debt and capital, which will be a real problem when sales are declining.

In parallel with this there is a lesson to be learnt on having a more integrated, diverse, and coordinated supply chain. The Video Surveillance business is far too dependent on Chinese manufacturers and also component manufacturers.

On the positive side COVID-19 has brought about the need for some physical security products to help deal with the pandemic and increase their sales during the opening of lockdown.

Thermal cameras can make a contribution to detecting COVID-19 by measuring people’s temperature as they enter buildings. Demand for these cameras has grown rapidly despite the fact that a number that have been tested are not particularly effective. Top of the range thermal cameras can cost up to $10,000 USD and although this is just one product in the video surveillance business it could help stimulate revenue generating opportunities through 2020.

Physical distancing technology through AI-powered analytics and video security cameras can continuously monitor physical distancing efforts within a building so that managers can run a report of when physical distancing violations occur. As well as recognising high violation zones and times requiring corrective measures.

The analytics algorithms are able to provide real-time information on the net number of people on the premises at any particular time as they can simultaneously count both people entering and those leaving the premises. The data can be displayed in an easy to understand format on smartphones, laptops and PCs to provide managers with an early warning that customer numbers are close to the permitted limit.

Access Control can also play an important role in contact tracing solutions. These can help ensure that the workforce stays safe by helping to prevent contamination in buildings. Physical access control enriched with video security evidence can provide important insights, such as understanding where an infected individual has been, which doors they accessed and who else may have come in contact with those doors and that individual.

These security solutions are designed to support organisations as they explore options for moving staff safely back into their buildings. The solutions focus on the key elements of safety and security around COVID-19, including prevention, protection and response. These offerings are vital to unlock our lives and get the world back to work. The Physical Security business is making a crucial contribution to getting life back to normal.