Blog Posts

Electronic Security Expo

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November 11, 2022 George DeMarco

There are a variety of factors to consider in maintaining a successful security business. Critical elements include recruiting and retaining talent, assessing employee and customer attrition, and growing sustainable recurring revenue and EBITDA. By far, the number one issue facing the security industry is a limited viable workforce. Consequently, dealers, integrators, and monitoring centers must rethink compensation packages, professional development, and employee retention programs for both new and existing employees. In addition, a good leadership team will strive to build the right culture, the right purpose, and the right vision that attracts the right people for all levels of the organization.  

Building the Right Team

Gaining the right employees is the first step. Keeping them is equally as important. Leadership and management training will be vital in this process. In addition, employee attrition should be tracked and analyzed to understand its cause and effect, subsequently using the data to improve employee retention. Improving employee retention and engagement will also have a direct and positive impact on customer attrition. 

Keeping Your Customer Base

That brings us to customer retention. Measuring customer attrition is critical to understanding the make-up of your company’s customer base and corresponding recurring revenue stream. For example, if your customer base is primarily focused on a market segment that can be hit hard by a recession or is highly concentrated in a particularly vulnerable segment, your attrition rate will likely trend much higher than normal. Understanding your customer attrition will also provide valuable insights into your product and service offerings and the delivery of the customer experience. 

In addition, more than ever, recurring revenues must be assessed to determine how vulnerable the company may be during this uncertain economic climate. Consider the value of understanding your exposure to possible industries that may be acutely or permanently damaged in the coming months or years. This exercise will also help you focus more clearly on the market segments that remain sustainable and profitable and identify emerging sectors to add to your go-to-market strategy.  You can also minimize your risk by diversifying your customer portfolio so that you are not too highly exposed to any one sector or customer type. 

Assess your EBITDA

Credit markets are becoming more challenging for companies that are not financially disciplined enough to meet lending covenants, especially dealers and integrators focused mainly on the residential market. We all understand that recurring revenues are good, but a solid plan to refocus on growing your EBITDA is even better. Whether you’re thinking about selling your company next year or the next decade, you should run your company like you’re going to sell it tomorrow.   

Security professionals who are interested in taking a deeper dive into the industry’s trends should register and attend ESX 2023 in Louisville, KY, June 5-8. Over the course of 3.5 days, attendees will experience industry-leading education programs, best practices, and more to take their business to the next level. 


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February 22, 2022 George DeMarco

At some point this year, the status of the pandemic should change to endemic stage, unless a new variant creates a major health concern. If we enter the endemic stage, Covid-19 will then become a part of our daily lives, like the seasonal flu, requiring us to get used to it. As dealers and integrators adjust to the new normal, I believe that the remainder of this year will bring less of a worry about Covid-19 and give way to other concerns, such as changing consumer expectations, access to products, labor shortages, and product and wage inflation. All organizations will modify their travel, health, and safety protocols, based on their risk tolerance of the pandemic’s status.  

Changes in the Workforce Landscape 

In addition, hybrid remote work options will remain a highly desirable choice for employees, as they have become accustomed to remote work alternatives. The place of work is rapidly changing, and many employees believe that the time is right to seek other opportunities that may provide higher wages, better work-life balance, improved career path, a more aligned business or life purpose, or the ability to relocate to another community. All of this is having a profound impact on every employer in the electronic security industry, as they realign their organizations to accommodate expectations of the current and future workforce.      

Expand Product & Service Offerings 

End users want the products and services we offer, which was proved last year. Many dealers and integrators experienced an exceptional growth year, especially those that had a higher risk tolerance in their growth strategies. I believe this year will require a similar risk tolerance, as other business risks come up front and center to replace the challenges from the pandemic. I anticipate this year will bring significant opportunities for organizations that are prepared to tackle the post-pandemic economy. However, being a one-dimensional burglar alarm provider may limit your growth potential, rather than offering complementary products and services that drive subscription fees (RMR) and higher profits.  

End-Users Are Adopting More Technology

The pandemic has caused an emerging change that will accelerate adoption of the digital life by people. With that, there is a broad appeal of remote processes that embrace tele-everything and smart products and apps for living and working in the digital world, greatly changing work structures and family life. This emerging change offers security professionals the ability to reinforce themselves as the trusted source and technology expert, helping end-users get and experience what really matters to them. End users want technology to easily control and manage their homes and businesses, and to keep them connected remotely, giving them a greater sense of safety, security, comfort, and convenience, including situational awareness that brings understanding or anticipation of needs. Until the integration of connected devices truly becomes ubiquitous and seamless, end-users will need dealers and integrators to manage the installation process and customer service support.  

A dealer or integrator that strives to understand the changing needs and expectations of its existing and future customers will be able to fine-tune their brand messaging and promise, select the right product and service offerings, and help differentiate themselves from the competition. 

Security professionals who are interested in taking a deeper dive into the industry’s trends should register and attend ESX 2022 in Fort Worth, TX, June 14-17. Over the course of 3.5 days attendees will experience industry-leading education programs, best practices, and more. It is where the industry gathers, and you don’t want to miss it.


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February 8, 2022 George DeMarco

The supply chain encompasses everything from sourcing the raw materials to the eventual product delivery. Many of the basic building-block chips go into the products the industry sells to consumers, businesses, governmental agencies, etc. Unfortunately, the chip shortage will likely get worse before it gets better, with some experts saying that it may not return to normal until 2023.

Dealers and integrators are integral in the delivery process, installing products and providing ongoing customer support services. As a result, if there is a supply chain bottleneck at any point, such as labor and semiconductor shortages, transportation delays, or price inflation, this disruption can cause growth challenges for dealers and integrators in 2022. However, I believe these challenges will be lessened in the second half of 2022, if these key risk factors are addressed:

  1. Materials: The demand for products that use computer chips will continue to outstrip the supply side until semiconductor manufacturers resolve it and move to a more resilient supply chain process.
  2. Labor shortages: This is requiring dealers, integrators, and monitoring centers to rethink compensation packages, professional development, and employee retention programs for new and existing workers.
  3. Consumer Demand: Labor and semiconductor shortages are causing cost inflation, which needs to be passed on to end-users. As a result, end-users may elect to delay or postpone projects if costs continue to skyrocket, potentially muting growth.

As supply chain disruption begins to subside, I believe the growth outlook for the electronic security industry will become more normalized as we enter a post-pandemic economy. In this next phase, consumer and business behaviors towards technology are changing along with their expectations, including privacy and information security. This will impact those companies unprepared for the next phase.

Security professionals who are interested in taking a deeper dive into the industry’s trends should register and attend ESX 2022 in Fort Worth, TX, June 14-17. Over the course of 3.5 days attendees will experience industry-leading education programs, best practices, and more. It is where the industry gathers, and you don’t want to miss it.