Business Roundtable: Hurdles Aplenty, and Optimistic All the While
In an exclusive roundtable, executives from four installing security firms reflect on the current state of the industry as well as their respective regional markets. Find out which technologies excite them, the challenges that keep them awake at night, and how they are positioning their companies for success in 2014.
Threats from national marketers with awfully deep pockets. Scuffling with vendors that allow their products to be discounted on the Internet. Painstaking efforts to transform the culture of a decades-old organization. Coping with technology obsolescence and maintaining relevancy with a new breed of customer. These are just some of myriad difficulties installing security contractors face each and every day. Remaining optimistic, and even successful, in the face of it all requires unflinching decision-making and a deft business hand.
Each year SECURITY SALES & INTEGRATION’s convenes a group of executives during Honeywell’s authorized dealer convention to sit down and discuss their particular challenges and successes. The intent is to foster an open forum that provides SSI readers insights into what other companies are experiencing in their respective markets and the hurdles they are navigating. This latest roundtable took place at Honeywell Connect 2013 in Los Angeles, which brought together for the first time members of the First Alert Professional (FAP), Commercial Security Systems (CSS) and Honeywell Integrated Security (HIS) networks.
In the ensuing conversation, John Campau, president and CEO of Comtronics in Jackson, Mich.; Kevin Stone, COO of Doyle Security in Rochester, N.Y.; Ronnie Whiddon, vice president of Custom Security Systems in Baton Rouge, La.; and Joseph Menke, president of Scottsdale, Ariz.-based Electronic Security Concepts, detail their strategies for 2014 and how they deal with the trials of operating successful companies. Find out how each of these security industry veterans are responding to internal challenges as well how new technologies and services are helping them meet the demands of a marketplace in continuous transition.
Let’s begin by having each of you recap your company’s performance in 2013.
John Campau: 2013, like 2012, was quite a challenge. The big thing we are struggling with is to change our culture at Comtronics. We can have the greatest strategy, but culture beats strategy every time. I recognize that and so I am trying to get our employees to embrace technology. We are trying to change our culture because this industry is moving so fast.
I have been in it for 30 years and I have seen more change in the past five years than in the previous 25. It is just the whole idea of embracing technology, accepting the fact what we are learning today will probably be obsolete in a year. It is that crazy. Getting people onboard with that has been a challenge. I have lost some really good, long-term people as a result of technology, quite frankly, leaving them in the dust.
Did we have a good 2013? Yes. Our numbers are up 27% over the year before. We are moving in the right direction, but with 100 employees it’s just a lot to move.
Kevin Stone: We had a very solid year. Our installation revenue was up significantly. Our recurring revenue was also up significantly. Home automation is definitely a part of it. We also have gotten more into managed access control. We are selling managed services. We are selling a lot more maintenance agreements. We are selling significantly more RMR per customer than we have in the past. That continues to ramp up and has for several years.
We definitely had some challenges. We battled the economy a little bit. We also had a lot of HR issues. We lost an employee unexpectedly to death and that caused quite a ripple effect in the organization. Finding people is a challenge. You hear unemployment is pretty high and so you’d think you could find people pretty easily and that is just not the case. We have added some great people and we think in the end we will be a stronger organization because of it, but no question it was difficult.
We also expanded into another market. We bought two offices in Albany, N.Y.and see a tremendous opportunity there.
Ronnie Whiddon: We had a good, strong year. John and Kevin did a great job of explaining the challenges of the alarm business. The burglar alarm side is still a real strong business for us. We are doing more and more of the home automation, but it seems like that’s all you hear about. But we are not seeing a ton of demand. People still want a burglar alarm. They still need a security system; they still want a fire system and access control.
The strong part of the business was probably video and it is becoming commonplace in residential applications. Fifteen years ago I would have never thought we would install as many camera systems as we do in homes. This is not high-end residential. We are talking about very affordable starter camera systems for people. It is becoming commonplace to do a lot of residential cameras. We have always done commercial camera systems. Some large and some small, but in our market it is the smaller systems we sell the most of.
As far as challenges, with IP cameras and networked systems it’s training people and getting them up to speed. The whole evolution of the industry, the products are changing constantly. That is a pretty big challenge for us. 2G radios is another one. We have already started changing those out and we have a long way to go. The sad part is we’re changing to a 4G radio, but it has a shelf life too.
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