B to b

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(Question) What is the nature of the security industry/market in Canada? What impact will this have on Metropol¡¯s market opportunity? Why?

There are some of factors that which contributed to the competitive nature of the security industry. Firstly most companies purchased service and equipment together. And security and private investigation market in Canada were worth about $15billion retail in 15 and ESDs were worth about $18. billion and other types of hardware were worth about $6.5 billion retail in 15. This result shows us that security field had big increase during 10 years about -4 times, especially in ESDs market. ESDs were the fastest growing segment of the security industry. Growth was expected to continue in the security industry for a variety of reasons including general increase in the level of risk, the rising insurance cost, economic growth, technological innovation which created new security problem.so on. Problem with Metropol Company is its ESDs and hardware. Businesses were spending almost as much on ESDs and related service as for security guard services. Metropol doesn¡¯t produce any of this ESD and hardware, it is big weakness to Metropol, and so Metropol has opportunity to develop ESD and hardware or find way to produce that equipment as supplier that can provide it to Metropol. Without provide service with equipment, Metropol lose half of the security market.

Another factor is price. The primary basis of competition in the security business was price. Most clients consider the cost of switching from one firm to another quite low, so the business often went to the lowest-cost provider. Most customer really didn¡¯t understand the difference in service provided by the various competitor in the security business, so customer prefer to goes to lower-priced service provider. So Metropol has to understand that customer¡¯s purchase decision process and make the service price down. Metropol should lower the service price because of that reason. But on the negative side was the industry¡¯s poor reputation for the quality and reliability of its service. This perception threatened to limit growth and provide an opportunity for new competitors enter the market. So Metropol should more focus on R&D and invest on train the security guard to offer superior service to customer as its quality.

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