- Tags : Facilities Management | Security Guard Services | Price trend | Price forecast | Procurement research | Category market forecast
Recent Price Trend - Security Guard Services
The average price of security guard services has been increasing at an estimated annualized rate of 1.7% from 2014 to 2017, primarily due to increased demand. Among demand drivers, government consumption and the number of businesses have both been growing with the broader economy during the past three years. However, demand growth has been mitigated by falling nonresidential construction activity and crime rate. Despite these drivers falling, demand overall has been rising. Higher aggregate demand has, in turn, enabled suppliers to raise prices for security guard services.
Large providers of security guard services have been raising their prices at a faster rate than the market average and have thus benefited the most from growing demand for services. These vendors’ diversified service offerings give them more room to implement price increases without risking a significant loss of business because their larger customers can still source multiple services from them and still save money. In addition, their customers are inherently less sensitive to price changes because top buyers have diversified revenue streams and tend to operate with large security budgets. Small operators have, however, also been able to raise prices in response to demand increases, thus limiting buyer negotiation power across the board.
Fortunately, price volatility has been low in the three years to 2017, making it easy for buyers to forecast prices and budget for security guard services. Steady increases in demand and stable input costs have prevented any drastic price fluctuations from occurring. Although buyers procure services on a case-by-case basis and cannot always anticipate how many security guards are needed, buyers that anticipate a need for the services in the next three years should consider entering long-term contracts to lock in prices before they rise further.
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