Is there reason to be confident in the future of the Fire and Life Safety industry? According to data from numerous reports, the answer appears to be a solid ‘yes.’ This may sound counterintuitive at a time when lingering issues from supply chain disruptions, labor shortages, and global inflation have turned most diehard optimists into avowed skeptics. However, thanks to various factors, including changing government regulations, increased construction spending, and the demand for new technology, the industry is poised to experience solid growth until at least the end of the decade.
This forecast spells great news for legacy Fire Protection business owners who are either looking to expand their footprint in preparation to pass their company on to the next generation, as well as those looking for buyers to purchase their operation.
Here’s What the Numbers Have to Say
Data from a report released by Grand View Research forecasted that the global revenue for fire protection systems–valued at $83.28 billion in 2023–will grow to over $130 billion in 2030.
The report cites numerous variables that include increased demand for fire detection systems across the healthcare and education sectors, as well as increased safety compliance standards set by the federal government and local municipalities,
Additionally, another reason behind the projected increase in revenue is the high cost associated with installing advanced fire alarm and detection systems, many of which are custom-designed and installed as per specific requirements. Add that to the demand for costly fire protection systems that use sensor technologies in fire protection devices, and you find another factor that has significantly added to financial growth in the industry.
Another key element noted in the report that’s driving industry demand is the rising use of Internet of Things (IoT) technology for interconnecting networks of devices and features in smart building systems. Big selling points for both residential and commercial buildings, these systems analyze and monitor fire and security risks and with building occupants in emergency situations. According to Markets and Markets, the IoT technology market is experiencing a similar boom with growth expected to reach $566.4 billion by 2027.
This points to an expected compound annual growth rate (CAGR) for fire protection systems globally of 6.6% from 2023 to 2030, or 3.9% CAGR in North America–which remains the world’s largest market.
Increased Market Competition
There’s a sense of optimism about the future of life safety systems within the industry. According to a survey of security professionals published in 2022 by trade publication SDM, 86 percent of those responding had a very positive outlook on the state of the fire alarm market (40 percent said it was very good to excellent, while 46 percent considered it good). Only 14 percent surveyed felt that the industry was in fair to poor condition.
SDM’s Industry Forecast also pointed to signs of increased competition among service providers at a time when larger companies are looking to expand their footprint. The survey reported a one-year 12 percentage point jump in the number of contractors that currently offer/sell/install fire alarm products and services. And of those not currently offering fire alarm products and services, 19 percent had plans to start offering them within five years.
This is the Ideal Time to Grow or Sell Your Fire Protection Business
This information should come as a harbinger of good fortune if you’re the owner of a fire protection company. With record expected growth rate through the end of the decade, there’s hardly been a more advantageous time to explore the options of selling. For family-run businesses who are looking to set a successful stage for their adult children to take over operations, increased growth could logically translate into increased business with the opportunity to expand or perhaps merge with other smaller players.
The future for the Fire Protection business is sunny, and companies of all sizes who are looking to sell, merge, or expand, are in the perfect business climate to make a change.
If you own a fire protection business and think now might be the time to explore the option of growing or selling, contact Rory Russell at 888-544-6726. As a 30-year veteran in the fire and security space, Rory specializes in helping fire protection companies like yours find the right partners or buyers for their unique needs and goals. You’ll receive guidance and support throughout every stage of the process, dealing with the negotiations and logistics so you can focus on your team and family during any transitions. Contact him today to get started!