Turning Access Control Into Recurring Revenue
Learn how your security firm can build its recurring monthly revenue with access control technology.
Access control ranks among the top three revenue achievers in the security market today. And now that a significant portion of the industry is finally embracing managed and hosted access control, new sources of recurring revenue have emerged for security integrators and alarm dealers. This access business model, however, is not new to the security industry.
Kastle Systems of Arlington, Va., has offered managed access control since the 1970s. In 2009, Gene Samburg, the founder of Kastle, said, “I believe that the manage-access philosophy works. Kastle manages 1,700 office buildings, 280 million square feet of real estate, with 1.7 million cardholders – so we must be doing something right.”
Today, the company claims it protects more than 2,000 properties with in excess of 37,000 tenant spaces, totaling 400 million square feet of office space. The fact is man-aged access has always been Kastle’s claim to fame and now here we are, three-and-a-half decades since the firm began offering this unique service, on the cusp of industry-wide acceptance. What a tribute to Samburg’s forward vision.
“We offer managed access, hosted, as well as centralized client server-based access control. It is our belief that the market has accepted it as the next big thing in access control,” says Michael Perlow, sales director with Idesco Corp., a New York-based security integrator.
There are also equipment manufacturers that have been experiencing an increase in managed and hosted access equipment purchases every year. “At Brivo, we have seen a 30% increase in the purchase of cloud-based managed/hosted systems each year for the past 16 years,” says Lee Odess, vice president of marketing with Brivo of Bethesda, Md. “I would say use of hosted systems is sure to increase as more and more security companies see the profit potential.”
Let’s take a look at the different flavors of access control offerings along with the advantages they present integrators, with particular attention directed at cloud-based services.
Emerging Access Business Models
There are several access business models that security integrators commonly follow. They are: traditional; hosted; managed; and lease purchase.
In a traditional, on-premises access control system the network head-end, which includes a PC or server, the software and data storage devices are contained onsite where they connect to a series of controllers that communicate with card readers, relay banks, and other building subsystems. The access control system may or may not be part of the facility LAN (local area network). Of course, there are advantages and disadvantages to this approach, which we’ll cover a little later.
Hosted access systems are different in that all head-end components, like the main server, software and data storage device(s), are contained off-premises – typically within a cloud. Using this model, the client pays for the use of these components while retaining ownership of access controllers and other peripherals onsite. The security integrator usually offers this service to the client through a third-party arrangement, thus it’s the integrator/host provider’s responsibility to pay all costs associated with maintenance and replacement.
A managed access system, on the other hand, involves the day-to-day operation of an access system by professionals for a recurring fee, whether it’s by the month, quarter, semi-annual or annual in nature. In years past, some security integrators provided several levels of managed services using the traditional access model. This includes database management card/token issuance, badging and card/token revocation. Today, many of these same companies provide these same services using the cloud model.
The lease purchase model is simply an arrangement between the security integrator and end user that allows the latter to pay for and eventually own the head-end equipment. Of course, this approach includes both traditional and cloud models, and it may or may not include the access control peripherals onsite. There are no limits to the number of combination of business models that the integrator can come up with, and it all involves budget, sales concept to the client and recurring revenue.
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