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Market
A niche market with attractive growth potential and low penetration
INVISIO addresses a global niche market. Customers are mainly public agencies and other public sector actors associated with defense, law enforcement, security and rescue services.
Demand on INVISIO’s markets is growing, as requirements concerning police and defense communications equipment grow, and as awareness of the consequences of hearing loss become increasingly known. The INVISIO and Racal Acoustics brands have clear market leading positions in their respective niches.
Market drivers
INVISIO drives the market
Demand for INVISIO’s products is driven by several interacting factors. In 2022 the new and more uncertain geopolitical situation, mainly in Europe, meant increased demand. In addition, structurally driven growth due to ongoing long-term modernization programs contribute to a widening use of communication equipment, as well as greater awareness regarding hearing loss and its effects on individuals and society.
By developing communication solutions that gradually raise industry requirements regarding performance, functionality and user experience, INVISIO contributes extensively to developing the market and driving its growth.
High entry barriers
The main entry barriers are the multi-year procurement programs and long framework agreements between supplier and customer. These conditions have led to a market structure characterized by few actors and long-term relations between suppliers and customers.
INVISIO considers that the company has an advantage in relation to its competitors as regards innovative capacity, well-established relations with customers and an understanding of their needs.
The high entry barriers mean that INVISIO has a strong market position in the short and medium-term perspective.
Market for personal systems
INVISIO addresses a global niche market. The customers are mainly found in defense forces as well as in the law enforcement and security market. They want to achieve operative advantages through improved communication, while at the same time protecting the users’ hearing.
I understand the risks they face.
Defense market
Great potential for continued growth in the target market
Industry statistics show that there are about 50 million soldiers in the world, of which 20 million are deemed to be active (INVISIO estimate).
The largest numbers of soldiers are in countries in Asia. Investments in advanced communication and hearing protection systems in these countries have historically been more limited, but are now growing at a relatively rapid rate.
INVISIO’s primary target group consists of technologically mature countries in Europe and North America. About two million potential users are serving in these countries' defense forces. The market value of INVISIO's personal system is estimated here to be about SEK 20 billion. As a rule, procurements take place at four-year intervals, which means that the average annual target market is about SEK 5 billion.
There are currently almost 250,000 users of INVISIO’s system, which means a market penetration of just over 10 per cent.
Law enforcement and security market
Initial focus on customers in the USA, Europe and partly Asia
There is a total of 2.7 million police in INVISIO’s markets. Of these, 30 per cent are deemed to be relevant to the company’s offer, which means that the target group has 700,000 to 900,000 potential users.
The law enforcement and security market is a relatively new market for INVISIO and initial focus is on addressing customers in the USA, Europe and selected countries in Asia.
The value of the law enforcement and security market for INVISIO’s personal system in these geographies is estimated to be about SEK 9 billion. The company estimates that its customers carry out procurements at intervals of five to seven years, which means that the annual addressable market for INVISIO’s system is worth about SEK 1.5 billion.
The law enforcement and security market is more fragmented and decentralized than the defense market, which means that INVISIO must address a larger number of customers in its sales work. An average order is therefore generally smaller than in the more centralized defense market.
Racal Acoustics
The offer for environments with constant and extremely high noise levels
Characteristic for users of equipment under the Racal Acoustics’ brand is that they are often stationed or in transit in a large military vehicle, or operating in another environment characterized by constant high noise, such as aircraft runways.
Industry statistics show that the total number of vehicle crew and passenger positions needing a headset for communication and hearing protection, is about 1.7 million. The company estimates that 1.2 million of these are relevant to address. The value of the global addressable market for the Racal Acoustics brand is estimated to be about SEK 7.0 billion.
As a rule, customers carry out procurements at 15-year intervals, which means that the average annual target market is about SEK 0.5 billion.
Market for the Intercom system
The market for solutions that enable internal communication in defense and law enforcement transport equipment has up to now been dominated by large, stationary systems. High purchasing costs have meant, however, that they are normally only mounted in large vehicles. INVISIO’s cost-effective solution expands the market by making the Intercom system available for smaller vehicles as well.
The Intercom system addresses communication problems that arise while in transit, where the members of the group want to be able to communicate both within the group and with the driver and units outside the vehicle. Here the Intercom system links communication simply and cost-effectively. The Intercom system can be carried by an individual user as a portable solution or be mounted in a vehicle or other means of transport.
The INVISIO Intercom System delivered the best speech clarity and intelligibility results ever heard on a maritime vessel going 63-64 knots, 118 KPH, or 74 MPH into a direct headwind!
The Intercom system
The portable system
In a first phase INVISIO intends to focus on the portable offer and direct it towards current users of the personal system. The company estimates that the addressable market is 25,000–40,000 systems.
The company assesses that its customers will carry out procurements at intervals of five to seven years, which means that the annual addressable market for INVISIO’s portable Intercom system is worth about SEK 0.5 billion.
The Intercom system
The mounted system
In a second phase INVISIO intends to address the customers’ existing fleets of vehicles, as well as vehicle manufacturers and vehicle equipment companies.
The company estimates that there are about 650,000 vehicles relevant to INVISIO’s offer. The estimated life of the system is about ten years, which gives an annual addressable market of about SEK 6.5 billion.
