Security Entrances: How to Capture New Growth Opportunities
With the right approach, integrators can seize upon demand for anti-tailgating products, in particular security revolving doors and mantrap portals, which have gone from infancy to early adopter to mass-utilization.
The security industry has certainly seen incredible growth in the past decade that has supported thousands of integrators and manufacturers with new and recurring business. Yet, a lot has also changed in the last five years as the market continues to mature and technologies advance rapidly.
Security integrators until now have relied on a predictable revenue model selling and installing security hardware and software to end users, with a portfolio that includes door hardware, access control systems, video surveillance and much more. But this model is starting to face some strong headwinds, demanding a need to look for new opportunities.
All the technologies listed above now require higher sales volumes to meet sales targets due to competition and the resulting severe downward pressure on pricing. Security cameras and card readers sell for just a few hundred dollars compared to much higher prices just a few years ago. To sell millions of dollars in security technology products, the sales team and account managers must work overtime to find new opportunities to gain the sales and margins needed to ensure continued profitability.
Increased competition and downward pricing, or commoditization, are impeding growth and even the health of many integrator firms today. This “squeeze” will to lead integrator firms failing and continued consolidation for those who do not seek out new sources of revenue with strong, stable margins. The good news is there is an immediate opportunity well worth looking into: security entrances.
Strong Demand, Stable Margins
Security entrances have been overlooked by security integrators as an access control solution. This despite the devices’ ability to solve the multiple risks presented by unauthorized entry — theft of property or data, workplace violence, bad PR, to name just a few — while simultaneously offering end users greater return on investment (ROI).
Security entrances help businesses control who enters and exits a building, and they effectively reduce the threat of tailgating, which has become a top security challenge recognized in the C Suite.
A big reason for slow adoption by integrators is because security entrances have only recently become familiar to end users. Boon Edam has witnessed in just the last five years that the demand for anti-tailgating products, in particular security revolving doors and mantrap portals, have gone from infancy to early adopter to a mass-utilization phase. The top Fortune 50 companies have awakened to the risks of tailgating only relatively recently, and these firms are deploying large volumes and more types of security entrances than ever before. Applications range from standard office/admin buildings to distribution, warehousing and data centers.
According to the IHS Markit 2015 survey, “The Market for Pedestrian Entrance Control Equipment,” the total market size in the Americas for all types of security entrance products grew from $123 million in 2012 to $159 million in 2014. That’s an average of 14% per year. The report predicts the entrance market will continue strong grow into the early 2020’s. The good news is that unlike video surveillance cameras and card readers, the margins on security entrances continue to be robust and stable.
Selling security entrances provides the opportunity for integrators to build a strong relationship with customers and produce new, substantial revenue streams for years to come. By asking the right questions and understanding exactly the solution required, account managers can potentially sell hundreds of thousands of dollars in product to a single, existing client by leveraging their current “trusted advisor” relationship.
Asking the Right Questions
Among the biggest obstacles seen in the market today is that most integrators aren’t familiar enough about security entrances and the positive impact they provide the end customer. Hence, they are unable to ask the right questions to power good, meaningful discussions.
For example, there is a significant difference between what an optical turnstile with barriers in a lobby does, and what a security revolving door can do. The significant difference in performance is measured in terms of tailgating prevention, upfront costs, annual expenditures, managing throughput, available metrics, guard force reduction, ROI, and other important factors.
The best first step for integrators is to gain a solid understanding about the different types of security entrances and their effectiveness related to tailgating mitigation.
Once acquainted with the impacts of the different types of security entrances, you can effectively identify the end user’s pain points, instead of bringing a preconceived notion of what they might need. Even when end users know they need some type of security entrance, they may not be familiar with the different types of products available, and they won’t accurately communicate their needs. While many people use the term “turnstile” for all entrance types, the integrator can add tremendous value in helping the end customer understand what they really need.
Asking the right questions can “disrupt” all assumptions and get the customer thinking about what they truly want to accomplish. What’s a good question? “Do you want to detect tailgating when it happens and respond to it, or do you want to prevent it from happening in the first place?”
Most end users will tell you they have never thought about physical security in that way, but they certainly need to and it’s the integrator’s role to motivate that thinking.
After accomplishing a thorough discovery, the next step is asking for a walk-through at the project site. This is an opportunity to see and evaluate what type of security is currently at each entrance. Is it manned by a security guard or is there a card reader attached to a locked swing door? Are they trying to measure tailgating occurrences? Do they currently have a security entrance? How is the entrance performing alongside any needed staff and technology in terms of reducing risk of penetration?
These are all crucial questions to ask to help you form a recommendation that results in the right solution for the end user.
Improved Revenue, Better Relationships
What might such a recommendation look like? Begin by integrating the access control system with five or six optical turnstiles to provide a physical barrier at a manned entrance. Perhaps you discover there is also a data center or other sensitive area that only a few people need access to and it currently only has a swinging door — you recommend an unmanned security mantrap portal to prevent any chance of tailgating (eliminating a guard here provides tangible ROI).
Move out to the perimeter of the campus and there’s an employee parking lot where sets of full-height turnstiles can ensure that only employees enter from that direction into certain buildings. Another possibility could be employee parking garages leading directly into side entrances of buildings where several security revolving doors can take the place of security guards. (Eastman Chemical did exactly this with their new corporate headquarters facility in Kingsport, Tenn.)
If your account representative were to successfully make the entire sale described above, it would result in a minimum of $400,000 in revenue. When you consider how many surveillance cameras you need to sell to match that amount, security entrances are certainly worth considering, especially given their potential in long-term ROI for the end user, deepening your end-user relationships, and gaining future business.
Oftentimes, end users choose to increase the number of entrances they purchase over time as their security needs change and grow. There are several reasons for this, but usually the customer will bring up new security pain points they have at other buildings once they see how their first security entrance project is functioning. This creates an opportunity to show them how they can secure other locations, which can lead to multiple sales over many years, with many end user companies standardizing on one company’s entrances.
By establishing solid, proactive relationships with new and existing customers, integrators have enormous upsell potential to increase revenue without the need to expand to new prospects.
A key decision remains before getting into this business: Do you rely on the manufacturer to provide installation and service on the products, or invest in technical training and get your own staff certified to grow the business? Both methods can be successful strategies provided you partner with an innovative, proactive manufacturer that can provide a true partnership for your future growth.
Assimilating security entrances into your business model can help you more easily meet your sales targets, while building additional trust relationships, keeping your customers happy, and increasing your profit margins. There has never been a better time to tap into this opportunity.
Mark Borto is President and CEO, Commercial Operations, of Lillington, N.C.-based Boon Edam.
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