Security Dealers: How to Gain New Profits by Expanding Products & Services
While it may be easy to stay within your comfort zone, to remain competitive security dealers and integrators must consider expanding their offerings.
Convergint Technologies has developed deep relationships with vendor partners worldwide. The company uses product labs in its technology centers to test new product integration.
Burg. Fire. Access. Video surveillance. Cyber. IoT. AI. Biometrics. New technologies and applications are being introduced alongside traditional ones all the time. And with them come new product offerings that are hitting the electronic security market at a seemingly record rate.
It’s enough to give today’s installing security dealers pause, and question the road-maps that guide their businesses forward. Diversify or stick with the tried and true? Tread into new territory or build on what you’re already comfortable with? Go to the next jobsite or take time out for training? Will adding staff add to profits or actually subtract from them?
These are the kinds of questions that keep security professionals up at night. Here’s another: what’s a security dealer to do?
To help answer some of these pressing queries, several security dealers and systems integrators weigh in here on what’s involved in expanding their products and services portfolios.
They share how they keep up with and vet potential new offerings and ultimately incorporate them into their business model. They also offer insights on other facets of running their businesses successfully, including differentiating the offerings from competitors; training; personnel considerations; operational adjustments; sales & marketing plans and strategies; installation matters; and service processes.
Vetting Vendors & New Products
Carey Boethel, CEO of Dallas-based Securadyne Systems, notes that the company uses a multistep process for evaluating new technologies. The first is to determine whether the manufacturer’s business model is synergistic with Securadyne’s.
“The greatest technology in the world is worthless if you can’t build a business around it,” he states. “We look at how the manufacturer goes to market — whether they sell exclusively through the channel or whether they also sell direct to end users, which is unacceptable to us. We assess their commercial organization, specifically their regional sales resources and the extent to which they not only support the channel, but also how they generate demand for their products. We assess their capitalization because we want to ensure that they have staying power and will be around to support their products over the long term.”
After the commercial aspects of the technology have been vetted, Securadyne evaluates the product technically, tests it and validates its application in the field. This, Boethel says, is because the engineers want to make sure that the product performs the way it’s been marketed to.
“If the commercial and technical evaluations are successful, we then determine market readiness. It’s tough for systems integrators to build a business around early adopters. We are most interested in products that are in the ‘early majority’ adoption stage because that’s where the volume starts to make sense for us.”
Steven Leonardo, director of Installation & Service for Huntington Station, N.Y.-based Electronix Systems Central Station Alarms (CSA), says the company looks first to its existing vendors when considering new offerings.
Being familiar with the manufacturer and its products is important to Leonardo, as is the company’s track record for reliability.
“It makes it easier for us to assimilate. If we see something new from them that we’re interested in, we’ll pursue it and test it,” he says. “If it’s a new vendor, we’ll meet with their sales and tech rep before we consider it and test it in-house.”
Nimesh Patel, Convergint Technologies’ director of Strategic Sourcing, says the Schaumburg, Ill.-headquartered company seeks out best-of-breed products and software solutions from its partners.
When considering a partnership with a new manufacturer, it’s important, he contends, to ensure that its infrastructure is properly in place. This includes factors such as financial health, quality assurance, logistics, information security, technical support, and continuous investment in colleagues.
“By placing an early emphasis on understanding the go-to-market strategy, key metrics, and expectations, we can better align and develop the trust necessary to build deep relationships with that same partner around the globe. We’ve been fortunate to see how our alignment with key manufacturing partners at various levels of the organization has enabled tremendous growth,” Patel says. “It’s helped implement new technologies with many of the same end users over the course of many years.”
Jason Etter, owner, AVX Integrated Technologies in West Nyack, N.Y., adds that while information is readily available for staying abreast of new products, “to truly stay apprised you need to keep an eye on trade publications, talk to other companies, distributors and manufacturers. Going to industry and association events also really helps you stay ahead of trends and be in the know.”
In terms of new products, Etter tends to gravitate toward manufacturers that offer a complete product line and aren’t oversaturated in the marketplace.
“We have strategic partnerships with various manufacturers mainly for those reasons. We prefer long-term relationships and to not jump from company to company when it comes to products. Adding new products from a company we’ve done business with for a long time is less risky for us.”
What’s Hot, What’s Not
According to Patel, there’s always a lot of innovation and overlapping with technologies that cause the categories to evolve. “We continue to see a great deal of interest surrounding video analytics and how our access control solutions can mitigate risk while establishing efficiencies across the enterprise. Data, both on-premises and in the Cloud, continues to multiply at a very high rate, commensurate with the growth in cameras, IoT devices and sensors being deployed. Convergint has a wide breadth of product offerings, and every technology we encounter must be reliable, scalable and cyber-secure,” he says.
In the surveillance category, product lines continue to develop every six months and security integrators must keep up, notes Don Kwapien, senior engineer, Setronics in Billerica, Mass. “We test the primary new models we want to use in-house usually within the same lines.”
The primary consideration with other technologies, he says, is new function that provides customer a return on investment, improved value to cost, the reputation and reliability of the supplier, and how it integrates with other products.
For residential customers, anything with updates, or newer product offerings that integrate with existing systems, or that have remotes capabilities are of particular interest to Electronix Systems, according to Leonardo.
“Customers want to know if they can access their system remotely,” he states. He attributes that to the big leaps the industry has seen in automation and consumer demand for more convenience and remote control.
Boethel points out that an attractive category for Securadyne Systems is intelligent video enabled by machine learning. He admits the technology is relatively immature, and Securadyne hasn’t yet deployed it in a mainstream fashion, but there’s no question among company leaders that machine learning will be highly disruptive and create new applications for video surveillance. “We’re also very interested in offering cybersecurity solutions,” he adds.
Keep reading for insights on how to tackle challenges when expanding offerings…
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