Security market in Germany: strong sales growth of over 10 percent in 2023

The Security market in Germany successfully continued its growth trajectory of recent years in 2023 and grew to over 31 billion euros, with IT security and security service providers as revenue drivers.

“The topic of security is more topical than ever”, they say from Security Essen, the leading trade fair that celebrates its 50th anniversary. The international fair brings the security industry together and showcases the industry’s innovations and further developments with around 500 exhibitors from September 17th to 20th, 2024. Whether cybercrime, burglary protection or access control, the demand in industry, companies and private households for individual and tailor-made security solutions is constantly increasing.

Security market in Germany: facts and figures

According to industry figures, the individual sectors achieved an overall increase in turnover of 9.7% to 31.27 billion euros in 2023 compared to the previous year. While the challenges associated with the coronavirus pandemic have thus been largely overcome, the Ukraine war and its associated economic risks have now come to the fore. Energy costs, which have risen significantly in some cases, and the associated price increases have further accelerated the trend towards digitalization and automation.

The IT security sub-segment in particular led to a significant increase in revenue in the period from 2022 to 2023. However, security services were also able to increase their revenue again in 2023 compared to previous years, in some cases significantly.

The development of sales in the sectors represented at Security Essen

Security services

Sales in the security services sub-sector rose by around 12.6% in the period from 2022 to 2023. While the coronavirus pandemic was partly responsible for the surge in sales in previous years, it is now the increased need for security in public and private spaces. Examples include major events and critical infrastructures, which are being protected to a greater extent. This can also be seen in the employment figures for 2022 and 2023 compared to 2021. Property protection will continue to account for the majority of turnover in 2023 (50%), followed by airport security (10%), emergency call and service control centers (10%) and cash and valuables services (5%).

Electronic safety technology

The general security situation and increasing networking and digitalization have once again boosted the market for electronic security technology:

• In 2023, the industry achieved an increase of around 3.63% compared to 2022, resulting in total sales of around 5.3 billion euros.
• There was growth in almost all segments in 2023 compared to the previous year.
• Video surveillance in particular grew by a good 5.9% between 2022 and 2023.
• The access control segment also grew significantly by 6.8% in the same period.
  Both segments benefit from AI-driven developments that make intelligent access and surveillance solutions even more efficient and further advance the networking of systems. The protection of critical facilities as well as corporate security in terms of sabotage and espionage protection are important factors for the steady growth in intelligent solutions. Fire alarm systems also recorded growth of 3.3 percent in the same period. Fire protection also benefited from a comparatively stable construction industry in 2022. Intruder alarm systems saw a slight increase of one percent in 2023. Sales of voice alarm systems increased slightly by 2.3% compared to 2022. Overall, it should be noted that, in addition to economic concerns, the problem of the shortage of skilled workers in particular is increasingly presenting companies with challenges.

Sales development of electronic security technology

Locks and fittings

In 2023, the lock and hardware industry had to contend with the effects of the war in Ukraine in its security technology with protective function segment and suffered a decline of 2.8% compared to 2022. The weakening construction industry in 2023 and inventory effects are further negative factors.
The production volume for cylinder locks for building doors totaled 134.8 million euros for mechanical products and 46.7 million euros for mechatronic and electronic products in 2023. This important sub-segment was thus able to buck the general trend and once again achieve an increase in turnover of almost five percent compared to 2022. The reason for this is likely to be the increasing digitalization and networking of trades in the course of modernization. In the area of safes and vaults, stable sales were recorded in a manageable segment.

IT security

The area of IT security, which was included for the first time in the last Security Essen 2022 report, is experiencing rapid growth in tense security policy times, not least due to ever newer AI applications. The war in Ukraine and the associated attacks on critical facilities and organized crime have led to a massive increase in IT attacks of all kinds.
Effective IT security is essential due to the ongoing networking of devices (Internet of Things, IoT), the sharp increase in cloud applications and the use of AI-based applications in almost all areas. According to the Federal Criminal Police Office, the number of recorded cybercrime offenses abroad rose by around 28% in 2023 compared to the previous year, while they fell slightly by 1.8% in Germany in 2023 compared to 2022 – still amounting to over 134,000 cases. Nationwide, over 800 companies and institutions reported ransomware cases.
All of these factors led to strong sales growth of over 13% in 2023 compared to the previous year. The target for the current year is again just under 13%, with turnover expected to rise to over ten billion euros for the first time.
At around 4.3 billion euros, expenditure on IT security software accounted for the largest share of expenditure in 2023. This was slightly followed by IT security services, which increased by twelve percent to four billion euros. Ongoing conflicts such as in Ukraine or the Middle East as well as constant espionage attempts by third countries will certainly ensure a further increase in IT security expenditure. Added to this are new laws and regulations as part of the implementation of EU requirements, such as the NIS-2 Directive, which regulates cyber security legislation across the EU. Numerous critical facilities and companies are affected by these implementations and are aligning their IT security accordingly. At the same time, there will continue to be awareness campaigns for businesses and private users, as many small and medium-sized companies in particular, as well as public institutions, urgently need to upgrade.