As we share frequently on our LinkedIn page: fire protection is a stable industry that is here to stay.
For those within the industry, this is obvious. The essential nature of fire protection and the evolution of safety requirements over time proves that the industry will only continue to grow with time.
But for those outside the industry, fire protection can be one of those things that you are not aware of until you need it or see it in action. But once you pay attention, you notice that fire safety equipment is everywhere, and for good reason!
From fire sprinkler systems and kitchen suppression systems to alarms and fire extinguishers, the equipment casts a protective net across every building. But, it has to be installed and maintained correctly if it is going to help during an emergency.
Here’s a closer look at the reasons why fire protection companies are a stable source of income and a great asset to any investment portfolio.
Safety Codes Continue to Update and Progress
Code requirements continue to change and advance each year in an effort to improve the safety of public spaces.
The NFPA Invests in Safety Research and Development
The National Fire Protection Association (NFPA) is constantly working to find better ways to protect the world from the threat of fire and fire-related emergencies. Because of their efforts, the developments that follow each fire-related tragedy make the places we work, shop, and live better suited to saving lives in the event of a fire.
Each time the safety codes created by the NFPA change, buildings need to be updated to match. Some of these updates can be applied over time or retroactively included, while others may require a more thorough update to the safety or detection system. This is not for the sake of creating unnecessary costs, but for the sake of constantly improving the approach to safety systems as more information is gathered and lessons are learned.
The Work Will Never Be “Finished”
Because fire protection will always be a work in progress, subject to in-depth research and development efforts, it will not reach a point where it is just “finished”. This means the industry has the longevity many investment firms long to find and include in their portfolio companies.
Fire Safety Provides Essential Services
The pandemic forced many industries to prove their value to society. In a time when health concerns were high and money was tight, only those companies that provided essential services were able to continue doing business. Fire protection companies were included in this.
Fire Protection is Not Optional
Whether it’s installing fire sprinklers and suppression systems in new construction or updating a system in an existing facility, adding and maintaining fire protection systems is not an option, it is a requirement. Keeping up with the inspection schedule and testing the systems regularly are prevention measures that are also required, as the equipment can only save lives when it is functioning properly.
Tragic Losses Prove Its Importance
Unfortunately, some fire safety measures did lapse as a result of the pandemic. But the risks to property and life as a result of these lapses were made evident, in some cases because fires did occur and were able to spread faster without the proper measures in place.
It is a sad fact that costly property damage and tragic deaths continue to prove the need for the services fire protection companies provide, the codes the NFPA continues to update, and the AHJ’s enforcement.
Inspections Are Recurring by Necessity
Recurring Monthly Revenue (RMR) is coveted by investors and business owners alike. It solves the problem of constantly needing new business to stay profitable by keeping existing customers and bringing in regular income. While some businesses create this recurring revenue by offering products or services people enjoy or like to have, few can claim that their monthly service is necessary. Fire protection can make that claim.
Sensitive Parts Require Regular Attention
Fire protection systems like sprinkler systems and suppression systems use sensitive parts that melt when exposed to hot temperatures. The sensitive nature of these parts helps them trigger the chain reaction of the system automatically when a fire is present. However, their sensitive nature also means they need to be changed regularly to stay reliable. There are additional parts that need inspected and swapped out frequently to help the system maintain pressure. Because these systems are located in hazardous or high traffic areas, there are many ways their reliability can be compromised if they are not inspected and tested on a regular basis.
Higher Risk Environments Have Even Stricter Codes
Most fire alarm systems and fire extinguishers in factories, plants, and schools both require monthly inspections to remain code-compliant and ready for use. Fire alarm system devices are sensitive and can be impacted by power outages or electrical issues. Monthly inspections give building managers peace of mind and ensure the safety of the buildings protected by the system.
The same goes for the extinguishers. Plants and factories are at an even higher risk for fire because of the intense processes completed in the facility every day. And in the case of schools, it is the occupants themselves who require extra protection.
Although the above is far from an exhaustive explanation of the recurring inspections required for fire protection equipment, it shows how these recurrences are to uphold safety standards. But, they also create extra income that a professional fire protection company can rely on month after month.
Technology Keeps Changing the Game
Technology is changing every industry, and fire protection is no exception! As technology advancements start to shift the way the industry approaches fire protection, the trajectory of growth is only looking positive.
Changing the Way Inspections Work
The inclusion of even more technology in fire protection, beyond just fire and security systems, was accelerated by the pandemic. With more places feeling uncomfortable with extra personnel coming in and out of their offices, the NFPA and other fire safety authorities started to brainstorm ways for inspections to still happen without physical contact. This has started many exciting conversations about new ways to keep people safe.
Security Integration Companies Embrace New Technology
The security integration space is no stranger to advancing technology! Fire alarm and security systems continue to benefit from better networks, more reliable connections, and redesigned equipment. Just as the television and phone options have improved over the years, there are a huge variety of options now when it comes to access control, commercial security, and fire detection and alarms.
These new tech options are making it easier to keep an eye on a building’s fire protection equipment from afar, make sure everything is up to date, print reports about the status of the equipment, and even control it from a remote location.
As technology keeps changing, fire protection companies keep learning how to adapt and integrate it into their work and equipment. Because they are happy to adopt the new options, the industry continues to stay relevant, proving it is prepared to protect tomorrow’s world even better than today’s.
Fire Protection is Worth the Investment
Whether you are a business owner trying to decide if it’s worth it to invest in growing your fire protection business or an investor looking to diversify your portfolio, the reasons above are proof that fire protection is more than a safe bet!
AFS Can Help You Make the Right Choice
With decades of experience helping security and fire protection business owners expand their services or sell their companies, Rory Russell can help you make the right investment for your future. If you want to learn more about fire protection as an investment option, or start talking to companies interested in selling, be sure to reach out today to start a conversation!
Whether you’re interested in purchasing a few accounts to build a department, or an entire company to expand your portfolio, AFS has the experience to help you make the best choice. Call Rory directly at 800-354-3863.