The New Age of Dealer Programs
Our industry seems to continually experience a kind of ebb and flow when it comes to dealer programs. We have seen periods during which independent installing contractors are presented with many programs stemming from manufacturers central stations, finance companies, acquisition companies and a variety of full-service alarm companies. We have also experienced times where dealer programs and other related support programs are scarce.
Whatever the case may be, what’s most important is that a clear understanding exists on what separates the differing program options that are available.
A Glance at Dealer Program Types
The easiest of programs to understand are those that are sponsored by a manufacturer. At the most basic level, these programs promote the purchasing of hardware and future hardware commitments in exchange for some additional marketing, sales and technical support. Vendor programs sometimes allow the dealer to use the manufacturer’s brand as part of their efforts as well. Most of these types of programs don’t have a lot of structure and for the most part are purchasing programs with a little extra spice.
Central station-sponsored programs tend to vary quite a bit. With an overall goal of activating new monitoring accounts, the lure of these programs is sometimes different. Some programs are fortunate to have a recognized consumer brand that serves as the compelling factor to enroll dealers. Others sometimes partner or sponsor a finance or acquisition platform to attract dealers. This also plays a reverse role for finance and acquisition organizations looking to increase their portfolio of accounts. These financial organizations may partner with a central station in a joint effort to draw dealers into a branded or nonbranded program.
The full service alarm companies that offer dealer programs have a clear motivation of extending their brand into areas where they don’t have a physical presence, while increasing their accounts portfolio by acquiring the new business from their selected dealers.
The Answers Are in the Details
In each of the scenarios above, it’s important for the dealer to recognize the root of each program and then analyze how, if at all, it can be a positive factor in achieving growth and success.
Since most high profile dealer programs through the years have been essentially acquisition-type arrangements at their core, most dealers who weren’t interested in financing or selling accounts tended to stay clear of anything labeled as a dealer program. Although most of these programs were creditable and proved valuable to some dealers, it’s unfortunate this stigma exists. Throughout the years we have seen a number of worthy programs with no finance or acquisition stipulations that would be of great value to installing contractors that otherwise proved reluctant committing to a dealer program.
During these trying economic times, we all need to consider anything that can legitimately give us a leg up on our competition. Our industry has marketplace segments that are down to varying degrees and other segments that are enjoying positive sales. The smart players are diversifying and diligently working on gaining as much ground as possible, especially in the areas that are seeing an upturn. Gaining or even maintaining a foothold in these volatile market spaces becomes more competitive every day.
The dealers that are structured, postured, knowledgeable, respectable and trustworthy are enjoying the growth. This doesn’t mean you have to be a large company, this means you need to walk the talk. Being a part of a program that enhances these key elements will only increase a dealer’s chance of persevering and leading the way to success in the markets in which it competes.
Dealers should be careful and remain diligent when considering any program. In times where every business decision is a critical one, it’s important to also mull over any additional support that’s available.
Peter Giacalone is President of Mace Security Int’l Inc.‘s Security Services Division.
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