International. More than 18 months after the COVID-19 pandemic, the global physical security market has demonstrated a remarkable degree of resilience, outperforming some other global tech sectors and indeed surpassing last year's best-case projection.
The pandemic is helping to reshape the physical security industry, driving certain emerging business models, while continuing to make our societies safer; not just the pandemic but crime and terrorism.
The latest analysis of global sales of physical security products at factory exit prices indicates that global sales in 2021 have recovered strongly year-over-year compared to 2020, growing to over US$33.8 billion, and the market is projected to maintain solid CAGR growth of nearly 7.2% over the next 5 years to 2026.
Major technology drivers of demand during the period include the growth of IoT and building system integrations, the growing demand for remote management and control, particularly cloud-based ACaaS and VSaaS services, and AI-based video analytics.
Meanwhile, macro market drivers such as crime, persistent terrorist threats, border disputes, and refugee crises will also continue to drive the adoption of physical security technologies.
The global COVID-19 pandemic has created a significant shift in demand distribution by vertical over the past two years, some of which will largely be short-term in nature. Lockdowns, their resulting economic impacts, and public concerns related to the transmission of the virus have negatively impacted sales in several markets, including retail, leisure, hotel verticals, and, to a lesser extent, offices. On the contrary, investment in the health and logistics sectors has increased considerably.
The market for video surveillance products still accounts for the largest share of physical security sales at 57%. The market rebounded strongly, with a year-on-year increase of 14.5%, surpassing 2019 sales and reaching a projected figure of $21.65 billion by 2021. Going forward, we expect growth from 2021 to 2026 to moderate back to a still healthy CAGR of 7.8%, with total sales expected to increase to $31.5 billion in 2026.
Source: memoori.
