According to an analysis carried out by Frost & Sullivan, the Middle East fire detection and suppression systems have experienced a boost.
Revenues in this market were more than $635.0 million during 2008, and are likely to peak to $1,124.9 million in 2013. The market growth is triggered by an increased growth experienced by the construction sector.
Increase in oil prices during 2008 had resulted in the creation of cumulative revenue surpluses and most of the revenue was directed to industrial developments and construction projects, according to the Gulf Cooperation Council (GCC). In addition, enhanced per capita income and expatriate influx has reinforced the requirement for retail and residential development. Increased activities in the commercial and industrial sectors, which widely utilize fire suppression systems in server rooms and refineries, are responsible for the increased sales of these systems.
According to Suganya Rajan, Research Analyst at Frost & Sullivan, the suppression of fire is a major part of the safety measures initiated in the Middle East region, and the demand for fire detection systems has increased due to strict fire regulations enforcement in the GCC market. Rajan revealed that the requirement of sprinkler systems utilized for the suppression of fire has increased due to the imposition of stringent regulations for under construction buildings in the Dubai region.
The market trends highlight a transformation to intelligent addressable systems from traditional systems. The requirement for fire detection and suppression solutions is mostly from the UAE. The UAE is also the leader in the Middle East region as far as market opportunities are concerned. However, the focus has shifted distinctly to Qatar and Saudi Arabia, as these nations have increased their commercial and real estate activities.
There are some hurdles in the Middle East market, despite high market prospects. Since there are fewer manufacturers in the Middle East region, the region mostly relies for fire detection and suppressing systems on imports. Such a high reliance has resulted in problems involving exchange rate volatility, demand, and supply. Companies will have to hedge themselves against fluctuations in currency otherwise they will experience a difficult period due to volatility vis-à-vis the dollar.
All large multinational companies entered the Middle East market through inorganic or organic routes resulting in additional strain on pressure margins. New entrants are unable to enter this market due to intense competition. Hundreds of registered organizations are involved in the market race, and most are system integrators.
Rajan revealed that various countries in this region have different laws that have created obstacles in the Middle East market and hindered the expansion plans of these companies. Rajan explained that companies need to understand the regulations that dictate the local markets so that they are able to speed up geographical expansion plans.
Participants in this market have found high labor expenses involved in system installation very challenging. Developers are focusing on lowering costs during system installation since pricing is a critical determinant for success.
In the future, companies have to focus on emerging markets in Kuwait, Qatar, and Saudi Arabis to prosper in such a competitive situation. They need to establish a good rapport with consultants and streamline their supply chain management to achieve a foothold in this market. Rajan observed that the harsh weather conditions prevailing in the region mandate that companies devote maximum importance to durability of the product enabling the systems to withstand severe environments. Almost every market participant facilitates system service and maintenance resulting in client retention and leverage its potential.
The evaluation of the Middle East Fire Detection and Suppression Systems Market is a component of the Building Management Technologies Growth Partnership Services program. The program also includes research on various markets such as Analysis of the District Cooling Market in the Middle East Region, Strategic Analysis of Fire & gas detection systems in India, North American HVAC Air Filters Market, and The European Lighting Market: Impact of the EU Ban on Inefficient Lamps.