With rising safety and security concerns, home security businesses can be profitable enterprises. There are currently over 3,500 security companies in the U.S., but not all of them offer quality services.
According to Mordor Intelligence, this is a growth market, with a projected increase of 15.2% in managed security services by 2026. If you’re thinking about starting a home security company and want it to be profitable, you need a plan. Here are some of the steps you can take to open your own security business and make it a success.
1. Thoroughly Study the Market
Since you’ll be selling and recommending security products and services to customers, it’s essential to understand this market thoroughly. You should aim your market research at answering the following questions: What are the different types of security or alarm systems? What are their features and benefits? How do they work?
In addition to understanding the products, make sure you get a clear picture of your target market and the competition. What potential customers do you plan to sell these systems to, and who are the major players in this market? Is there something missing that you can capitalize on to create better service?
2. Decide Whether to Franchise or Not
Once you learn more about the security business, you’ll realize it can be complex. There are pros and cons to being a part of a franchise. When you choose the franchise route, you gain access to a ready-made business structure and marketing model.
That said, a franchise will also dictate what you can charge for your services and many other aspects of your business. This may not be an ideal choice if you want to serve a niche market or create specialized services.
3. Secure the Right Licensing and Insurance Coverage
You will need to jump through many regulatory hoops to start a security business. For example, many states require background checks, fingerprinting, and licensing. Some states also require that owners secure a surety bond from an insurance company. If the security company fails to perform as promised, a customer can file a claim with the bond company.
It’s also a good idea for security companies to have suitable insurance coverage, such as a general liability policy and errors and omissions insurance. If you install home security systems, you’ll also want commercial auto, workers’ compensation, property, and umbrella coverage.
4. Get Certifications and Join Associations
If you’re going to start a private security company, you need to do it right. This will require that you get the necessary certifications. One of the benefits you’ll want to offer your customers is being a UL-listed company. UL is short for Underwriters Laboratories. UL-listed central stations are held to the highest possible safety standards, ensuring redundancies are in place for uninterrupted services.
You’ll also want to join associations affiliated with your industry to provide credibility and offer you some valuable networking opportunities. The Electronic Security Association is one option. And don’t forget about your local Chamber of Commerce to gain other valuable contacts in your community.
When starting a home security business, you’ll want to obtain industry-standard contracts, which allow rate increases, minimize liability exposure, and protect your business.
5. Create a Business and Marketing Plan
Now that you’ve laid the groundwork for your business, it’s time to put together a detailed business plan. This will lay out how you plan to launch your business and maintain the operation for the first several years. It should include financials and a description of your target audience.
Your business plan will also include how you plan to market your business. A successful security company needs a brand and an online presence (social media is a great place to start). You’ll need to create a website and roadmap for building brand awareness and driving prospects to your sales page. Once there, your sales page should be strong enough to convert them to paying customers.
6. Secure Necessary Startup Funding
It’s tough to start any business without some startup funding. Your business plan should tell you how much capital you’ll need to get your security business off the ground and running for the first year or so. Then, you can figure out your funding options.
You can present your business and marketing plan to various lenders, such as banks, credit unions, and private investors. Some franchises even offer in-house financing or referrals, which is another reason to consider using this option if you need capital.
7. Surround Yourself With Security Experts
It’s possible that you might already have a background and some experience in the security industry. However, this might not be enough to run a successful security business from the startup phase. You’re going to need all the help you can get.
In addition to hiring people with general business skills, make sure you hire workers with technical know-how. And don’t forget that the partners and vendors you choose will be invaluable in helping make your business a success.
8. Launch Your Business
Once you feel like you have everything in place, it’s time to launch your security business. The first things to go live should be your sales and marketing initiatives, which will begin building awareness of your brand. You can choose a “start” date to begin offering home security services to new clients. Before you know it, you’ll have a continuous influx of new business and will be on the road to success.
Central Station Alarm Monitoring Services for Your Home Security Company
Every successful home security company offers alarm and video monitoring services to provide clients with the highest level of protection and peace of mind. Quick Response is more than equipped to handle this task.
We are a TMA Five-Diamond Certified central station with over four decades of experience in the alarm industry. Our monitoring and dispatching staff are available 24/7. We act as an extension of your brand to protect your business reputation and enhance its overall value. Contact us today to learn more about our monitoring solutions.