Looking for insights and ideas that can take your business to the next level? If you’re a security dealer who wants to make the most of what’s ahead in 2024, then you need to know about the trends and issues currently shaping our industry–and how to leverage them. Whether you’re inspired to revamp your business processes, update your tools, or refresh your service offerings, here are our recommendations for making this your best year yet.
#1. Make recurring monthly revenue the core of your business.
It used to be enough to do a one-time installation, find your next customer, and repeat the process. But your existing customer base also happens to be your best customer base, and recurring monthly revenue (RMR) from these contracts is a great way to ensure consistent cash flow for your business while providing customers with the level of service they want and need.
In 2024, we expect to see even more security dealers pivoting to managed services and software-as-a-service to create significant recurring monthly revenue. It’s a savvy move with real growth potential: according to the SDM 2024 Industry Forecast Report, of companies that currently generate recurring monthly revenue, 73% are seeing a significant increase over last year, and an average of 20% revenue growth!
Mike Botten, the sales manager for LVC Companies in Minneapolis, told SDM: “We’re keenly aware that if we don’t [switch from traditional to more managed services], we won’t be in business for another 43 or 44 years.” He and his team are even setting up a dedicated salesforce for recurring revenue!
What are a few subscription-based services you could add to the mix this year? Think monthly maintenance plans, remote access and support, cloud storage capabilities–and that’s just a start. According to the SDM report, 75% of security businesses said they offered managed access control, 71% offered video surveillance as a service, and 66% offered access control as a service. Compared to last year, the number of companies offering each of these services rose by double digit percentage points! Remote video monitoring, software as a service, network health monitoring, and cybersecurity services were also on the menu, albeit not as common.
Another way to grow RMR is simply to let customers pay for security installations and service on a monthly basis, with interest. According to insights from the new Parks Associates Security Dealer Perspectives Study, the current economy is causing customers to tighten budgets and change the way they pay for big purchases. Increasingly, they are interested in plans that allow them to spread their payments out over time. For some, payment plans like these may even make it possible to finance larger security projects–a win for you.
#2. Ride the AI growth wave.
AI is changing everything. Video surveillance, threat detection, access control systems, and more are all getting a tremendous boost from AI’s powerful processing and data analytics abilities. Not only is AI creating new opportunities and product lines for security dealers, its growth potential is massive. According to Mordor Intelligence, the size of the AI security market is projected to reach $25.22 billion in 2024, surging to $60.24 billion in the next five years. That translates to real opportunities for security dealers who know how to harness this growth.
Yet dealers don’t seem to be maximizing the potential of AI as a powerful sales tool–yet. The newly-released Parks Associates study cited above reveals that just 15% of dealers highlight AI in their customer messaging, with 36% saying they’re worried AI will either confuse or scare customers. While some customers may worry about controversial AI capabilities, like facial recognition, there are a multitude of very real benefits that can and should be highlighted.
For example, AI is already proving useful in a world where connected devices and applications, linked to a multitude of endpoints, make us more vulnerable to security breaches. In this environment, AI can quickly sift massive streams of data and detect potential threats faster than humans ever could. AI is progressing in other ways, too. It’s already good at detecting vehicles and people in a frame, reducing the threat of false alarms, but we can expect even greater capabilities as AI begins to recognize and alert us to potential hazards (like wet floors) or imminent dangers (like active shooters).
Ultimately, it’s your job to show customers how these technologies can enhance everything from their video surveillance systems to their data analytics. Open your customers up to the potential of AI, and you open yourself up to the profit potential of this rapidly-growing market. Whether that growth flows to you–or to your competitors–is in your hands.
#3. Focus on security solutions that can keep up with the times.
Customers don’t want to have to switch out their security system every few years, as new technology is introduced–and they shouldn’t have to. Nobody wants to buy security solutions that become obsolete as soon as they’re installed, and that point is more important than ever now that new innovations appear faster than we can finish pitching the previous ones!
This year, focus your messaging, and your energy, on solutions and services that won’t limit your customer. Open platforms, easy integration among different third-party devices, and the ability to upgrade and integrate existing equipment with emerging technologies are key.
#4. Be responsive to–and educate customers about–emerging threats.
Your customers need to know that you’ll always have their back–and they will trust you if you can give them solid insights on how the threat landscape is changing around them. This year, make it your mission to become a trusted advisor and educator who can prepare them for all eventualities. Providing security equipment and services is only one half of the equation: the rest is about education.
New threats are always emerging, and our current security challenges go far beyond intrusion detection and fire alarms. In reality, you and your customers need to stay agile and well-protected in an era of hate groups, political polarization, protest, multi-billion dollar organized retail crime, and the omnipresence of mass shootings (there were 656 such shootings reported last year alone.) And let’s not forget the looming cybersecurity threats your customers may face from a growing network of interconnected, smart home devices–some of which will soon no longer be supported or updated, allowing insidious vulnerabilities to creep in with time.
#5. Maximize your potential with powerful business processes.
Let’s be honest: the ideas above may be interesting, but you’re going to need more than a few good insights and old-fashioned motivation to get them going. What you’re going to need is time. And for security dealers, that can be hard to come by. Fortunately, there is a way to wrangle back several hours of time each month, and that’s by streamlining your business processes.
If you’re still stuck in the vicious cycle of manual data entry, paper contracts, sending and following up on multiple invoices, and toggling between multiple applications and documents just to get your accounting, scheduling, or HR in line…you are not maximizing your true potential. That’s where software solutions, like Managely, can help.
Managely is a business management solution designed specifically for the security industry. It can automate your billing and payment collection; make it easy to set up recurring monthly payments; simplify the way you create, deliver, and follow up on proposals; help you schedule installations and service with ease; and help increase margins by cutting costs and clunky processes. Interested? Give Managely a try today.
We hope these ideas have given you something great to work on this year–and will give you something rewarding to look back on once we roll into 2025. Which of these will you implement first? There’s no better time to start than now.