The Latin fire detection market is showing quite interesting growth; the explosion of the construction sector has had a direct impact on these trends.
by Julián Arcila
The period from mid-2006 to the same period in 2007 has been quite hectic when it comes to fire detection in Latin America. The construction boom in many of the countries of the region, the large investments made by public and private sectors, and a presumed concern for protection in all aspects, have been decisive factors for the revitalization of the sector.
In the opinion of some professionals and experts who have been involved in this sector, the demands and consumption of smoke and fire detection technology have presented significant growth in various regions, due, in addition to the factors mentioned in the first paragraph, to the emergence of new trends in this segment, driven in some way by the "new wave" of smart buildings.
The good moment is highly related to the good wind that the Latin economy has enjoyed, but despite this present the market is still far from maturing, still being impacted by the price; such a situation that has favored the massive entry of Chinese products, which are not always synonymous with quality and technical support. An alarming fact is that there have been cases in which installation companies that enjoy a good name in the region have chosen to install low-price equipment to increase profit margins on projects.
Brazil and Mexico continue to be the economic engines of the region, added to increases in business in other nations. Venezuela, Colombia, Panama, Costa Rica and Guatemala have been presenting good economic indicators, more specifically in terms of construction.
Proof of this are the figures published by the Colombian weekly El Espectador (www.elespectador.com) at the end of last year, where they say that in almost all Latin American countries construction is advancing at rates above 15%, while in Colombia this figure is around 6% of the national GDP.
Thus, these figures are also good for the fires segment, as the experts of the sector say, in which growth rates of between 4 and 10% can be observed, depending on the segment. VENTAS DE SEGURIDAD spoke with four renowned professionals to try an analysis of what is happening in this market in the region.
Highs and lows
Given the relationship between fire detection systems and construction, and the relationship between the latter and the economy, (the latter also highly dependent on political stability), it can be inferred that the fire segment was to some degree affected by last year's political moves in some of the countries of the region. There are several positive and negative elements registered by the Latin fire detection market.
Mexico is perhaps the most impacted, as the governments of this country usually take some time to accommodate and start investments in public spending. While this is happening, what can be done in the field of new construction basically depends on private initiatives, as stated by Carlos Tovilla, Sales Manager of Securiton for this market.
For Felipe Argüello, CTO (Chief Technology Officer) of Electronics Security & Control, the most positive element is the stable growth of the segment, which has been driven by the increase in the demand for security technology in general. He also highlighted the change of trend in the continent, where from being a simple alternative, the use of fire technology has become a requirement. Unfortunately, the market is still too price sensitive. With all this, this professional said that his company had a growth of 50% between 2006 and 2007.
But, the stable growth has translated into better figures for the companies that participate in the market, as happened with Honeywell, a company that spoke through Carlos Zorrilla, regional sales manager for Mexico. A negative element he cited was the entry of low-quality products and the use of these as a method of saving for the installer, a practice that almost always ends up harming the end user.
Glenn Patrizio, sales manager for Latin America and the Caribbean of the brand representation firm LRG, agreed with the above, who said that although the market is growing, there are some difficulties associated with the delay in delivery times and the abundance of products from the East.
The best buyers
In addition to Mexico and Brazil, countries that have always stood out for going further in terms of technology use and monitoring of fire regulations, other nations have begun to stand out for this business. Venezuela has also stood out for the development of its own regulations, and remains stable in terms of this sector.
One of the factors that has had a strong impact on the purchase of more technologies is the international adoption of various regulations. "For our company, the best markets are focused on Argentina, Brazil and Mexico, and in recent times Colombia, in this order rigorously, since they are markets that already have established legislation and regulations and / or in the process of development," said Carlos Tovilla.
But Glenn Patrizio claimed that there was sustained growth in almost all nations, but highlighted those that, according to him, have always led constant work in this area: Mexico, Argentina, Chile, Colombia, Venezuela and Brazil. "Now, more regulations are being implemented every day, thanks to multinational companies and organizations, and thanks to the needs of security men to test their knowledge. The most efficient segments are oil, industrial and hotel. There is still much to be done in hospital and commercial matters," he said.
Felipe Argüello agreed with Patrizio in the appointment of these countries (he did not cite Chile or Venezuela); as the best markets and as the best sectors named trade and industry (petroleum and chemicals). He also highlighted the transport (airports) and government sectors as good sources of investment for the fire segment.
"Both in Mexico, Brazil and Argentina there is a local presence of the largest fire manufacturers with offices and even manufacture and / or assembly of their devices in those countries. Some of the manufacturers that stand out are; Tyco, Siemens and System Sensor. We also see that in these countries there is a consolidated distribution of the largest manufacturers of Fire. Andean countries such as Colombia, Venezuela, Peru and Ecuador remain stable in terms of demand," Argüello explained.
But there is another interesting market, or at least carlos Zorrilla hinted at it: Panama. Along with Mexico and Colombia, this nation has been standing out, thanks to investments in new housing and commercial projects. "The segments that have been increasing their demand for this type of technology are the hotel industry; industrial, in the case of big oil, petrochemical, pharmaceutical, and in buildings for rent of high-level offices, "he said.
The client is looking for...
In the fire segment, technology, as in other sectors, has made significant progress towards simplifying work and increasing safety conditions. This media consulted professionals on this subject and there are several preferences and needs that have been detected in the market. The term "intelligence" continues to gain traction, as does the concept of networks.
In Argüello's opinion, the changes in trend that have occurred in the market are due to changes in technology, that is, companies that manufactured certain types of equipment have changed to more modern devices, forcing the migration of the industry. "The Latin American market begins to move away from the use of ionization smoke detectors due to the fear of contamination with the radioactive material (Americium 241) present in the detection chambers of these detectors and because many manufacturers began to discontinue the manufacture of this type of equipment. This has allowed the demand for photoelectric smoke detectors combined with thermal detectors to increase, as an alternative replacement for ionic detectors," he said.
He added that another element that has modified the demand map of this technology is the increasing need to eliminate false alarms, a situation that has favored the acquisition of intelligent smoke detectors (analog / addressable) that allow adjusting the degree of sensitivity, compensate automatically and program different profiles and predetermined ambient conditions.
Patrizio approached Argüello's position, as far as intelligent systems are concerned, noting that they are certainly the market trend. Conventional ones are still the most used in medium and small businesses. "The reason is implicit in the very conditions that define a system of this type: reliability and speed in effective detection. This has allowed a reduction of costs in such a way that the best evaluation would be: a more educated market that wants to minimize failures and improve the performance of systems," he noted.
Meanwhile, for Carlos Tovilla, what is commanding the market and winning the preference of buyers are early detection systems, particularly for computer centers and large warehouses; intelligent systems have also stood out, as explained by this professional. "Clients are moving towards early detection to avoid damage or large effects, in which the entrepreneur or owner of the property is the big loser; some information from insurance agencies indicates that 95% of the lossed industries close their doors after a maximum of two years, since their slow and gradual reactivation makes them lose the market. Only 5% of these companies resume their client portfolio and manage to develop new markets and stay active," he said.
One element to think about in the future is the lack of local regulations for products. In developed countries there are regulations that prevent products that are not certified by UL or FM from being used. Well, this is a flaw in Latin America that has allowed the market to be flooded with non-certified products, almost always manufactured in the East, which deconfigure the market and keep it in a position of technological immaturity.
Some of lime and others of sand
One of the most important elements of a market when it is focusing on technology is the knowledge and possibilities that its professionals have to access the technical information produced by associations and experts. The professionals interviewed do not have a uniform position on this topic, because although it is true that more work is needed in terms of information training, the positive thing is that the few data collected have been fundamental for the market to modify demand and therefore that companies have to modify their offer.
Glenn Patrizio is one of those who leans towards the above. According to him, the user has acquired such a degree of knowledge that it has led companies that previously did not comply with international regulations, to do so. He noted that it is the same competition that has facilitated the dissemination of knowledge among integrators, in addition to the fact that products currently lend themselves more to easy installation and operation.
Argüello corroborated this when he stated that "the market continues to advance in terms of the acquisition of knowledge, development of local regulations and certification of engineers and technicians. We see the progress of the NFPA and its Latin American Section as it has created local chapters in several countries in Latin America and the Caribbean, translating and providing more standards and codes, and certifying more fire professionals through CEPI certification." In addition to the above, he noted, manufacturers of fire solutions have become aware of the need to provide more information and organize certification programs.
In contrast, Tovilla was not so optimistic about the possibilities of access to information in Latin America. According to him, there is not so much clarity regarding the concepts of the software and hardware that is used in the implementation of a fire detection system. As a positive element, he highlighted the possibility offered by the Internet for technicians and integrators to know the characteristics of each technology.
Zorrilla agreed to some degree with Carlos and affirmed that although there is a greater awareness of adapting the international regulations of associations such as the NFPA, on the other hand what is perceived is a relatively low knowledge for the design and / or programming of fire detection systems. In contrast, he assured that there is more information available that is offered in the form of fairs, congresses, and seminars, among others.
But looking at the set of characteristics offered by the Latin market, it is quite interesting and positive that demand has increased, as this is a sign that every day there are more institutions and actors interested in implementing these technologies, thus increasing the degree of protection of buildings in the region.
However, there are still aspects to improve, such as the region's concern about the price. To the extent that more information days are developed to educate consumers about the different phenomena that fill the market on a daily basis, the end user will be able to make better choices, something that will benefit manufacturers. An equation that should never be forgotten is that in the business world knowledge equals profits.
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