Cash in transit

Following an intense period of consolidation, the Cash in Transit Industry’s largest firms are now even larger, whilst we continue to see regional firms thriving in various territories across the globe.

 
During the first few months of this year, we have seen the acquisition of G4S by Brink's. This transaction, along with Brink’s’ recent purchase of Dunbar in the USA and of several other companies in Latin America, is evidence of their expansion strategy.

Whilst these acquisitions have taken place across the past few years, we have seen many independent Cash in Transit firms being formed across the globe, in various sectors across the regional and international cash markets. As a result, the Cash in Transit arena has, in effect, become a two or three-tier market of larger global firms, international firms and regional firms.

During this COVID-19 outbreak, all Cash in Transit firms have had individual challenges and hurdles to overcome. The logistics of Cash management have probably never been harder, with social distancing, the shutdown of non-essential stores and the inevitable challenges regarding manpower.

Of course, the largest Cash in Transit firms are of significant scale, which of course brings advantages – allowing them to service clients through a wide-ranging network across national and international territories, while the regional firms focus on servicing companies within their regions, and possibly expanding their footprint as the opportunities arise with vendors seeking a localised service.

We have certainly seen many regional Cash in Transit firms shifting their focus to the ATM and Smart Safe markets for local and regional stores, which demonstrates that they are able to react quickly to the changes in clients’ requirements with regards to logistical and service-related needs.

Furthermore, recent developments in technology – both in vehicles and Smart Safes etc. – have resulted in firms of all sizes considering the use of technology (in many cases in conjunction with manpower), and trying to determine the right balance between these two assets to complement their traditional service. In many cases the use of technology is to create cost savings and provide a more effective streamlined service, whilst in other cases technology is used to offer additional layers of protection and surveillance.

The use of one-man vehicles is possibly the best demonstration of how technology has enhanced protection and can help the industry deliver efficient, cost-effective service without a reduction in overall security.

As with most industries, the key to success is how effectively you can service clients’ needs. 

The COVID-19 pandemic has thrown a particularly bright light on companies’ abilities to look after their clients across all industries. Who can adapt to this changing environment? Will one of the outcomes of COVID-19 be the greater utilisation of local and regional firms - with companies wanting vendors to be nearby, offering a more personal, local-centric service?

Cash in Transit companies and their clients are benefiting from these advancements in technology, which allow them to operate in a more nimble, and traceable, way. And as time evolves, these technologies will allow businesses to grow: The Cash in Transit firms that adapt and are resilient to these changes will likely thrive.

Much of the issues above have been replicated in the Cash in Transit Insurance market, which has also seen significant consolidation amongst Insurers over the past 5 years - and now it appears to be the Brokers’ time in the spotlight, with the recent purchase of JLT by Marsh along with the announcement of Aon’s purchase of Willis Towers Watson.

Like the Cash In Transit industry, the insurance market will face challenges during and post COVID-19. We have already seen the industry adapting over the past two months, with the increased use of communication technology, for example, Skype and Zoom, internally and between Brokers and Underwriters. For several years the Lloyd’s market has been focussed on the development of electronic trading, so during this period of social distancing, there has been a significant increase in the use of PPL (The Lloyd’s of London electronic placing platform).

Undoubtedly we will all be facing a different world post-COVID-19 but many of the same business principles remain. In times of uncertainty, communication becomes more important than ever: communication between providers, customers, underwriters and brokers become key to ensure each party understands the other’s needs. Starting those conversations sooner rather than later is increasingly important. All businesses are adapting – some are under more constraints than they were previously, and the allowance of time, therefore, becomes of greater importance, so all parties have more time to consider all available options.

In the past weeks, we have seen the Lloyd’s of London and London Insurance Company markets, as well as the international underwriting community, adapting to these changes with a keen focus on “business as usual” in order to service the needs of Cash in Transit industry whilst we all work within this new business environment.