Brazil's already well-developed security market is experiencing double digit growth driven by stable economic growth and great events to come as World Cup in 2014 and Olympic Games in 2016. This article will give you an overview of the Brazilian security industry and its promises for the future.
Brazil has an extensive and well-developed security market that registered an average annual growth of 15 to 20% for the last eight years and annual sales around BRL 24 billion. Foreign products account for approximately 50% of the total market share, with U.S. products representing half of these imports. Other major players come from Israel, Korea and Japan, each one responsible for 10 to 15% of the import market share.
We know that Brazil carries an international reputation of being a violent country. But curiously, the level of criminality is not the only responsible for boosting the national security industry, as crime rates and social inequalities have been falling. The security market has became so promising also because of the country's general wealth increase.
Money is entering the country like never before. Foreign investments are high, national businesses and companies are growing. With people and entities getting richer, the needs for protection raises in equal proportions. So the national economic growth was an important contributor to growth in the Brazilian Security market.
The largest clients in this market are financial and commercial institutions and the Federal Government, that supplies the national Public Security Sector. When it comes to imports, to be successful in Brazil, foreign manufacturers must either establish themselves within the country or have a local representative. It is also important to have a distributor who can offer after sales and maintenance services, replacement parts, and repairs.
The Industry in numbers
There are approximately 8.000 security companies operating in Brazil divided as:
- 49% retailers and installers
- 30% providers of monitoring services
- 12% distributors
- 9% manufacturers
About 84% of Brazil’s electronic security is made up of small and micro businesses, but the highest revenues are generated by a few large players. International companies like Bosch, Johnson Controls, Tyco, Siemens, Pelco, Samsung, GE and others have already established a strong presence in the country through representatives, distributors, and/or joint-venture partners.
Those are the areas that currently present the best prospects in the Security market. Some of them deserved a specific topic, as you will see further.
- Public Safety and Security: hi-tech equipments and professional training
- Large Events
- Mass Transportation: bus and subway stations security systems
- Airport security: electronic equipments, such as X rays and metal detectors
- Personal and domestic defense: bodyguards, home alarms and TV circuits
- Cyber security: especially in data cryptography. Brazil has one of the largest hackers' community in the world
Richer people, higher protection
According to Forbes magazine, we have a new millionaire every two hours in Brazil. In 2011, the country counted with 160 thousand millionaires and about 30 billionaires, 70% of them concentrated in the states of São Paulo and Rio de Janeiro.
The raising amount of enriched people in the country calls for private homes as high crime rates force individual citizens and business owners to increase their security expenditures.
Brazilians preoccupation with personal security has specifically increased the demand for hi-tech electronic security equipment, such as closed circuit televisions (CCTVs), alarm systems, surveillance technology, smoke detectors as well as trained surveillance professionals.
Public Security Sector
The high criminal rates in Brazil demand constant improvements on public security. There are opportunities in several segments, but the electronic security is currently the best call. A good example is the posture adopted by many Brazilian cities by installing video cameras on the streets to inhibit criminal activities.
The Public Security Sector in Brazil is composed by a handful of autonomous entities (each one can be seen as a potential client). Basically, there are three police forces: civil police, military police and federal police. Then we have the so-called "Civil Defense" that includes fire departments and emergency medical rescue departments.
The Ministry of Justice is in charge of public security in Brazil. The Ministry coordinates the following law enforcement agencies:
- Military Police - responsible for crime prevention
- Civil Police - responsible for crime investigation
- Federal Police - in charge of federal crimes, border control and immigration
Public Security is a hungry client in the security market. The list of most purchased items includes: small and medium sized vehicles, pickup trucks, motorcycles, bulletproof vests, handcuffs, non-lethal weapons (such as tear gas, and rubber bullets); portable communication radios, computers, pistols, machine-guns, revolvers, communication equipments, ballistic shields and helmets, anti-trauma equipment, batons, shotguns, super machine guns, night vision goggles, X-ray equipment to detect narcotics and cellular call blockers.
Most of these items are manufactured in Brazil, but several police officials have indicated that their quality is not up to the level of those produced abroad. If prices are equivalent, foreign products will be preferred. There is a wide acceptance of foreign security equipments in Brazil.
World Cup and the Olympic games
Investments in the World Cup and in the Olympic Games security net have started in 2011, with bidding processes and negotiations with foreign companies. The investments will be concentrated in enhancing security in ports and airports, streets and mass transportation systems (buses and subway stations). Also, there will be a modernizing and training process of law enforcement agents.
There are countless private security companies operating illegally in Brazil, especially when it comes to private surveillance professionals, the bodyguards. Brazil has specific laws that regulate this profession, which include a 120 hours training, psychological and technical tests, among other requirements.
Other illegalities concerns to the commerce of weapons provided from international smuggling, what is strongly fed by drug trafficking in Brazil. Also, there are several unauthorized manufacturers of security equipments, especially electronics.