Under achievers will lead to 9000 jobs loss

But the consequence for companies in the rest of the industry is that to compete, they will need to axe as many as 9400 jobs in the next 12 months.

This claim is made in the latest Plimsoll Portfolio Analysis which identifies 194 of the high achieving companies.

Typically, they are generating £117,000 sales per person and £10,000 profit per person. Last year, the average UK security company achieved £77,000 sales per employee and a mere £2,000 profit per employee, says the report.

At most risk of being left behind, 141 companies have been identified as only generating an average of £24,000 sales per employee. Their spend on salaries is far too high for them to be competitive, consuming 76 per cent of sales. This figure should be 34 per cent or less. If these companies are to catch up with new standards of productivity, 9400 jobs could be at risk, says the report.

David Pattison, Senior Analyst at Plimsoll Publishing, said:

“As I see it, it is very easy to fall for the ‘we need more people’ screams from your staff. You have to watch this. It is vital to keep your sales per employee ratio and perhaps more importantly your percentage of sales used for salaries under control.

“If you take nothing from our industry analysis at all, just remember three key facts. Get your sales per employee up to or above £77,000, your spend on salaries to 34 per cent of sales or less, and control your debts. These are the ingredients for a healthy and competitive UK security company.”

The latest edition of the Analysis assesses the financial performance of the industry’s leading 1000 players and rates each one based on its overall health. It is available for £305 (Paper) or £499+VAT (Electronic). Order at www.plimsoll.co.uk or call 01642 626400.

Readers of Security Installer will receive a 5per cent discount.