Security Sales & Integration has learned that ADT Security Services Inc. has trimmed its Authorized Dealer Program from approximately 700 dealers—operating in 1,600 locations nationwide—to around 500. In a move to eliminate dealers that were either falling short of the quantity and/or quality stipulated in their ADT Authorized Dealer contracts, the nation’s largest program of its kind sent letters to 200 of its dealers in August notifying them that they were being terminated.

According to ADT, adjusting the program, which had grown substantially since being introduced in 1994, simply made good business sense. “The changes are intended to improve the quality of customers by increasing the credit score requirements. We believe these new performance requirements will improve customer retention rates, cash flow and increase our ROI [return on investment],” Jay Stuck, vice president of ADT’s Residential Marketing, told SSI. “This change reflects a strategic decision we made to shift the program focus from quantity to quality. We remain committed to our dealer program and believe the changes will strengthen the program as the premier one of its kind in the industry.”

Although the majority of industry professionals SSI spoke with applaud ADT’s decision to reassess its Authorized Dealer Program, some dealers feel they have been unfairly targeted. “As a mom-and-pop company, it will definitely affect us,” says Reis Leming of Security One in Bend, Ore. “At the invitation of ADT, we became an authorized dealer and sold them hundreds of accounts. I know another dealer in this area who relies on that business to survive, and he is going out of business. I am sure many of those little guys will be affected this way.”

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