How To Start A Security Guard Company

HOW TO START A SECURITY GUARD COMPANY

BY JASON W. MURPHEY

EVERYTHING YOU NEED TO KNOW ABOUT STARTING A COMPANY IN THE PROFESSIONAL SECURITY INDUSTRY

P i c t u r e d : A G&C Security patrol car circ. 1998. This particular patrol car had previously served as an Oregon Highway Patrol vehicle. It found an exciting second life in private security enforcement.

Copyright 2012 - Red Swordfish Media

HOW TO START A SECURIT Y GUARD COMPANY

SUMMARY OF CONTENTS I. The Benefits And Challenges ....................................................... 1 II. My Story................................................................................. 3 III. My Security Agency ................................................................ 4 IV. How Much Does It Cost To Start A New Security Guard Company? .... 7 V. How Much Should the New Company Charge Its Clients? .................. 12

VI. Developing a Documentation System ........................................... 17 VII. Creating the Hook.................................................................. 19 VIII. Specialization..................................................................... 23 IX. Market Research..................................................................... 27

X. The Legal Paperwork ............................................................... 30 XI. Operating Policies and Procedures ............................................ 32 XII. Marketing Materials ............................................................. 34 XIII. Review ............................................................................. 36 XIV. Establishing the Communications Infrastructure ........................ 38 XV. The Shift Report ................................................................... 42 XVI. The IR - Taking A Bad Situation and Turning It Positive ...... 45 XVII. Other Reports .................................................................... 47 XVIII. Building the Relationships that Pay Off ................................. 50 XIX. Security Officer Recruitment ................................................. 52 XX. Security Officer Retention ..................................................... 54 XXI. Assembling a Sales Team Without Paying Anything .................... 55 XXII. Client Sourcing and Securing Contracts ............................................ 59 XXIII. Flexibility ....................................................................... 60 X X I V. C o n c l u s i o n . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 1

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HOW TO START A SECURIT Y GUARD COMPANY Chapter

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Benefits And Challenges When Starting A New Security Company The reader of this ebook probably already knows that owning a security guard company provides many benefits.

The reader may know firsthand how security officers frequently become trapped within the large international corporations which dominate the private security industry in so many cities.

All too often these corporations provide limited opportunity for advancement. When the officer does advance, he may find himself trapped in a supervisory position with duties mostly limited to staffing security sites. This involves making phone calls and pleading with officers to fill open shifts as opposed to engaging in serious day-to-day security activities.

The creation of his own security agency provides the officer with an outlet for his escape from the world of big corporate security.

As the owner of a security agency the officer controls his own destiny. He makes a living by providing clients with solutions to their security challenges. He receives satisfaction by mitigating these challenges and through training new officers who may initially enter the security industry as his employee. These employees may subsequently spend a long career in security and law enforcement. They will likely always remember and be grateful for the opportunity and the training provided by the agency.

The owner of a successful security company can set his own work hours, take vacation when he feels like it and work whatever security post he is in the mood to work.

If successful, the security company will grow into a valuable entity with a long client list that can eventually be sold for a significant amount.

The owner will need to invest long hours building his company. But, if he can sign and retain enough clients then the sky is the limit.

I can still remember the feeling of walking out of the client's facility after signing them up for my company. I can also recall taking the phone call from the business where I had just dropped off my company's marketing materials. "We need security! Can you start tonight?" Meeting the immediate security needs of these clients required flexibility but it felt great to take on this challenge and know that my company had taken yet another step towards profitability.

SecurityOfficerHQ.com Each and every time the company signs on another client it takes a big step towards covering its expenses and advancing towards the time when it will demonstrate a profit margin.

Unlike startups in other industries, security companies have almost no expensive capital that must be purchased prior to the company's opening day. The company doesn't need a building, expensive tools, or production equipment. Security company owners don't need to worry about the liability of a big piece of equipment breaking down.

Because there are few liabilities, when a company becomes profitable it is unlikely that the company will go back into the red. The agency must simply sign on new clients faster than it loses through attrition The biggest liabilities owned and maintained by the company are perhaps patrol cars. And these can be warrantied if need be.

The job isn't without its challenges. Owning and operating a security agency requires the officer to come into contact with many people. This is the business of a people person. The owner must not fear soliciting business and he must not dread rejection. For every 100 clients he solicits for business he will be successful if he signs just one.

Once he secures a new client his job is just beginning. The owner must develop the plan to secure the client's property. He must put into place the post orders that will provide guidance to his officers. When one of his officers makes a mistake it will be his opportunity to save the account by communicating with the client and working through all difficulties. As the company's highest ranking officer it his job to both communicate with the client and provide a solution to the client's greatest security challenges.

He must also ensure that all invoices are paid, officers are trained, payroll is met and the company's pricing strategy remains competitive.

When an on-site officer is having an altercation with troublemakers, the police are refusing to help, and the client is upset, it is the people skills of the owner which will resolve the situation.

These are just some of the benefits and challenges that are associated with the effort to start a new security agency.

This ebook conveys helpful suggestions for meeting the challenges and realizing the benefits from the creation of the new security guard company.

It will walk the reader through a series of steps, including the defining of the company's services, implementation of strategies for keeping overhead low, underbidding the competition and completing the necessary legal paperwork.

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My Story Starting a security company was one of the most exciting and educational experiences of my life. At the age of 18, I earned a license as an unarmed officer. I had very much wanted to be a part of the private security world. I was so committed to this vision that I actually took the state-mandated 40 hours of required class time and applied for my license without ever taking a conditional license.

As soon as I got a license I went looking for a job. I was hired by one of the first security companies whose classified advertising I responded to. It was one of the big name companies and I received my first post at a large office complex. The complex consisted of two six-story office buildings and was staffed 24 hours a day by unarmed security officers. I learned a lot from the job but it was a disappointing experience.

For one thing the post was completely boring. It was the type of post that is ideal for a college student who wants to do school work while on duty or a retiree who needs to earn supplemental income while working within a security environment that entails no significant risk. But, it wasn't an environment in which security incidents took place.

I worked third shift and the biggest challenge was to stay awake. In order for us to get any real on-the-job security training we had to hope someone would wander into the complex's expansive parking lot at some point during the night. This happened on occasion but it certainly didn't provide enough activity to allow me to develop and sharpen security enforcement skills.

Also disappointing was the fact that the security agency didn't seem to have an effective process for finding those officers who wanted to work hard and move up in the company. The agency seemed to simply throw warm bodies into shifts. It was almost as if the company was just a personnel staffing agency as opposed to a security agency.

The lack of a challenge and the uncertainty of the opportunity to move up soon caused me to move on in search of a more exciting challenge.

SecurityOfficerHQ.com I had became convinced that I could form my own security agency. I started looking for clients. Over the next few years, with a lot of hard work, I was able to build up a series of both patrol and on-site clients.

I quickly discovered that I couldn't be too selective when it came to picking the clientele. I desperately needed the business. I had to quickly find several clients in order to distribute overhead costs such as insurance and I needed references in order to get bigger and better accounts. So, I had to take on clients in some of the worst parts of town.

As you might imagine, this allowed me plenty of opportunity to make up for the missed excitement and experience from the previous security job.

Over the next few years I learned a lot about dealing with security incidents and all that goes with them. I also learned how to interact with the police, clients, employees, other companies' security officers and competitors.

Through this series of articles I hope to share some of those lessons and provide some great ideas and suggestions to security officers who, like me, want to escape from the big security companies and start their own security agency.

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My Security Agency As the owner of a new security agency, I wanted to provide an innovative security service to my clients. It was my goal to offer a service that was more affordable while also providing unique features to the clients. I think my agency was successful in doing just that.

Here is how we did it.

In the early days, the agency started providing services to patrol-only clients before we signed up any full-time on-site clients. Patrol clients were easier to sign up at first since they didn't have to pay nearly as much for security services. They didn't necessarily require a long reference list in order to sign on with our company.

These patrol clients provided the references so we could sign on with the bigger and

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higher paying on-site posts who would be more likely to require references.

That's not all! Because of the patrol route the on-site posts were able to take advantage of the fact that the area was also serviced by our patrol route. When the onsite officer needed backup he could call our patrol officer to provide him with the support he needed. Thus, we offered our on-site clients with the services of at least two officers for the price of one.

This provided my agency with a competitive advantage over the agencies that didn't offer patrol services.

The patrol route officer was equipped with a professional looking former police vehicle and a detention cage. Should an arrest take place at a client facility the client didn't have to worry about an officer and a handcuffed arrestee standing around their facility where their tenants could see them. Depending on the day and time it might take several minutes or more for law enforcement to come get the arrestee. This would have created an ongoing security situation where the officer had to worry about the arrested person trying to run off or shout insults at the client's employees and tenants. With the assistance of the patrol officer, the on-site officer could simply effect an arrest, handcuff the arrestee, search the arrestee for weapons and place him in the patrol officer's car.

This superior level of service was offered while underbidding the competition. The patrol route clients essentially subsidized the on-site operation. And, that was okay, because the patrol clients paid on a per-patrol basis. The patrol service was designed to allow the patrol officer extra time to support on-site posts when necessary.

The patrol service also allowed us to concentrate data collection and reporting. This took place in the late 90’s before mobile data access become inexpensive. Since our database wasn't Web-based it was a logistical challenge for all of our officers to have access to the data while on-duty. But, because our mobile database went everywhere with the patrol officer an on-site officer could call him to retrieve data or could ask him to enter data on those who were creating trouble at his site. This dynamic collection of data on those who created disturbances was in and of itself a bit innovative. I am not sure any other agency offered this as a feature.

The agency specialized in providing patrol and on-site security to motels and hotels.

Because we had a series of these types of clients our database potentially provided real value to the client. A person that created a disturbance or trashed a room at one site might be identified at a second site upon a data check within our system. Or, a person that was asked to leave a client's property and told to never return by one officer, upon returning to the property, could potentially face arrest by another officer who pulled that person's file in the database. A troublemaker couldn't simply wait for one officer to go off duty before coming back on site again and expect that the next officer wouldn't be able

SecurityOfficerHQ.com to see what had happened in the past. This system provided an important institutional knowledge-base that could transition from officer to officer.

How did we develop the technology for the data collection and retrieval? I just purchased an inexpensive laptop, put a Microsoft Access database on it, and put it in a patrol car. The laptop could be pulled out of one patrol car and placed in another one as necessary. In this way, we had a mobile data retrieval system always assigned to an onduty patrol officer. We didn't have to hire a dispatcher to sit in front of a computer. The patrol officer essentially become the dispatcher for the purpose of data retrieval.

The patrol route also provided me with a direct mechanism for supervising and training our officers. I would frequently work the patrol route personally. This allowed me to drop by and visit with our officers at a moment's notice. This kept the officers on their toes knowing that either I or a supervisor could be on site at any time.

I implemented a series of other strategies designed to keep costs low. I had to keep overhead costs at a very minimum to have any chance when bidding against the big security companies.

Here are some of those cost-cutting strategies.

The agency partnered with the federal Job Corp program. We used their security industry students as officers at some of our sites. This saved the company from having to pay workers' compensation costs for these work hours. The Job Corp program paid these costs.

This also provided a lot of flexibility as we were under no requirement to keep a student working on post if they didn't work out. When things didn't work out we didn't have to worry about unemployment claims or costs. When the student met expectations we could hire the student as an employee when they graduated. This allowed us to lower insurance costs and provided the luxury of an evaluation period for our employees.

The Job Corp program also paid for the employees' uniforms.

These savings did come with some liability as the students weren't always the most experienced security officers. But, should the student not work out the company was under no obligation to keep them on site.

I also attempted to keep very close notes on the state of the local security market.

I developed a database of potential security clients and would document the necessary information to put our agency in a good position to win their business. This database was built using the FileMaker software which quickly became my database software of choice.

I learned the importance of documenting every substantive interaction with a potential

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client. Even when we were not winning a client out of an interaction it was still a win for us if we could locate the correct contact person and find out when they normally put their security services up for a bid. Then, it was vital for us to record that date in our database so we would be ready to bid for the business at the right time.

We also kept office cost minimized by trading patrol services for office space. A large mini-storage and office complex needed security and had unused office inventory.

I agreed to provide them with a certain amount of security coverage each night in return for office space. This gave the patrol officer a place to go between patrols while simultaneously paying for the office space by patrolling the storage complex. The office would serve as the anchor for our patrol route.

These were a few of the successful techniques I learned and deployed in our effort to offer a superior product at a lower price. I made mistakes as well and not every effort was successful. Throughout the course of this ebook it is my intent to communicate some of these lessons.

I became convinced that there is a great need for these types of small startup security companies to innovate in a market all too often dominated by the large corporations that are too big to effectively innovate while simultaneously providing an affordable product.

With the spread of Web-based solutions, I believe this innovation is more possible than ever before. When I implemented this low-cost security model back in the preInternet era I was a 19 year old with just several months of experience in the security industry. Imagine how successful those with more experience and with access to the technology of today could be!

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How Much Does It Cost To Start A New Security Guard Company?

With some notable exceptions, there isn't a lot of incentive to make a career out of working within one of the big security agencies. Even when an officer works his way up the ranks he will all too often become stuck behind a desk where his duties primarily orient around ensuring each shift is properly staffed. If the officer really wanted a career as a personnel officer he could have just as easily gone to work for a temporary staffing

SecurityOfficerHQ.com provider.

Making matters even worse, many security jobs do not provide benefits. While these jobs are perfect as temporary employment for those who are working their way through college, earning part-time money from an extra job, or supplementing retirement income, they are clearly not in and of themselves conducive to a lifetime career.

Understandably, entrepreneurial security officers who wish to earn a good living and control their own destiny will see the creation of their own security firm as an attractive option.

But how much does it cost to get started?

The low cost of entry presents one of the most attractive components of starting a business in the security industry. Since the nature of the business simply orients around the provision of an officer there are not a lot of upfront capital costs.

And, there is nothing to stop a security business owner from personally working one of his own accounts. This allows him to continuing earning an income while he is building the company. Using this strategy he can keep prices low while he builds a reference base that will allow him to expand his client base. Once he has a strong client base he can raise the prices to include a profit margin and at that time no longer need to personally work security shifts on a day-to-day basis.

That having been said, the new security business owner should be prepared to pay out some minimal upfront costs. What follows are some examples of costs that will vary by geographic area and based on the legal requirements of the company's home jurisdiction.

Insurance Costs The majority of a new startup security business' non-labor related costs are tied to insurance. The company must purchase general liability insurance, workers' compensation insurance, and pay unemployment insurance withholdings.

Insurance costs will vary by location but it isn't unreasonable to price the cumulative insurance costs for a startup firm at $500 per month.

For the purposes of an example, let's say that a security officer starts his own business. He starts out with just one client who needs one eight-hour third-shift security officer. To recoup its cost the company must charge $2 per hour just to recover insurance costs ($500 a month divided by 240 hours).

This high cost makes it hard for the new company to compete for business. It is

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paramount for the company to quickly obtain additional clients in order to spread out this cost.

Adding a second 240-hour-per-month client will not greatly increase insurance costs but will drop the amount needed per hour down to $1. By adding on just one additional client the company has cut insurance cost overhead by 50%.

Let's say that the new company wins a contract to provide security to a third client, only this time for 24 hours per day; now the insurance cost per hour amounts to just 41 cents.

At this rate the company can aggressively compete for business while underbidding the competition. By signing on three clients instead of one the company has cut its insurance cost overhead from $2 per hour to 41 cents each hour.

As the reader should clearly see, it is important for the new startup to quickly acquire a handful of clients to spread out the cost of the insurance. Otherwise, pricing in $2 per hour for insurance simply isn't going to allow the new agency to compete against the bigger companies which can easily disperse that cost out.

The cost of insurance will scale up over time as the business grows and if there are claims against the business. But, there probably won't be too much difference in cost between an agency who provides 240 hours of security coverage per month and an agency which serves for 1200 hours each month.

It is a great day when the company signs on its first client. But, this places the company in its most vulnerable position. Without more clients the company can not disperse its overhead costs and become profitable.

As you continue to read this ebook you will notice the following theme. Perhaps the greatest barrier to the success of a new company is in quickly making it past the oneclient stage and signing up that next series of businesses that will allow the company to turn the corner and become successful.

Back to the subject at hand. How much should the owner of the new security startup invest in the company at its outset?

The new startup should have at least enough resources to purchase six months of coverage in advance. So, in the above example the owner of the new security company should be prepared to pay out $3,000 upon startup in order to recover insurance costs.

SecurityOfficerHQ.com Legal Costs Naturally there are some regulatory costs to get started but this shouldn't amount to much. Unlike other industries the security industry isn't heavily regulated. There are no inspection costs, waiting periods or other costly startup fees seen in other occupations.

Regulatory costs include obtaining a security license from the state or cities where the company plans to provide service. This cost will vary by jurisdictions as some states regulate security at the state level while others allow city government to license security companies. In a few states, there is no regulation of the security industry and in these venues the company may not need a license. Most regulatory agencies will require the agency to show proof of general liability insurance before they can secure a license.

As a side note, the company's license will likely need renewed at some time so the renewal costs should be priced into the company's pricing model. More on that later.

There are also costs related to the paperwork necessary to establish the company's legal status as an LLC or corporation. The new company owner should plan for at least $500 of outlay for these costs.

Initial Officer and Client Recruitment Costs Most security officers can probably be recruited through free advertising services such as Craigslist. In the past, new companies were forced to recruit through paid classified advertising. Those days are over and thanks to technology just a little bit of the cost of doing business has been completely mitigated.

Likewise the cost of acquiring clients can also be mitigated provided the owner of the company is willing to put the work into the acquisition activity. The company should also heavily use Craigslist looking for salespeople who are willing to work on a commission basis. The commission could be priced into the per-hour charge to the client thus requiring little upfront outlay.

A little later on, this ebook will speak to both of these subjects in much greater detail.

Uniform and Equipment Costs Many security guards have accumulated their own equipment over time. However, the company will certainly want to provide the basic uniform with badge. Many officers expect that their uniform will be provided by the company and it will hurt officer recruitment if the company attempts to pass on this cost to the officer. New startups should expect an outlay of at least $100 per officer in uniform costs.

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Marketing materials may be produced without too much expense. However, this is a very important focus of the new company as these materials should look and feel professional. A new company should expect an initial cost of $1000 for quality marketing materials.

The company should also develop a Web presence. Initially there is nothing wrong with starting out on a free Wordpress platform which mostly repurposes the content from the marketing materials. Wordpress isn't hard to install and any number of attractive themes are easy to find on the Web at no cost to the company.

It is important that it be hosted on a domain owned and branded by the company. It shouldn't cost more than $70 for the domain and hosting for the first year. By using free content management platforms such as Wordpress the company can defer paying Webdevelopment and design costs.

Office Costs Local business or security licensing laws might require the agency to maintain an office. At least initially, all effort should be taken to mitigate this cost. Perhaps a local business co-op can provide a shared office space for a minimal fee such as $50 or $100 a month. While this might only provide a shared office it should meet the requirements of the law, provide a mailing address and give the new company access to a shared conference room which could prove beneficial for client meetings.

Some businesses or office property managers might be willing to trade office space for a certain amount of free security coverage or even for just providing free alarm response. My company entered into this type of arrangement. We traded security services for an office. The office provided a location where the patrol route security officer could go during his shift and he was providing security services to the client even while taking a break from the normal patrol route.

If the office isn't mandated by law the startup shouldn't spend any time worrying about reserving an office until they get big enough to justify one. Most client meetings take place at the client's facility and officers do not need an office because they will go straight to the post when they go on duty. The is no excuse for the business to spend any significant amount of startup capital on office space.

Labor-related Costs The company must match each employee's FICA withholdings which can add up since 90% of the firm's activity is labor cost. This is an ongoing stable and consistent cost

SecurityOfficerHQ.com that must be priced into the cost of doing business. The employer should keep in mind that his FICA match will be about 8% or so of the officer's salary. An officer who makes $10 per hour will require an 8% match or eighty cents an hour. However, the cost won't have to be incurred until the company cuts the paycheck to the officer. But, even if the owner of the company works the shift personally, this match will still be required. This fact is important to note as a new startup may fail to price this in to the company's cost model.

Since security is so labor intensive almost all of this cost will need to be directly reflected in the amount the company charges to its clients.

Contingency Costs It is also important for the company to start and populate a contingency fund. This fund should be indexed as a percent of the company's total revenue. As the company grows so should the fund. The new owner should place at least $2000 in the fund as an initial seeding.

After tallying up all of these cost it appears a new security startup should plan on at least $7,000 of initial outlay.

Chapter

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How Much Should the New Company Charge Its Clients?

More likely than not the new security agency does not have a strong base of initial references upon which to depend. To obtain its first array of clients the agency must offer a distinguishing characteristic such as a unique feature or low pricing model.

This characteristic offsets the risk the new client incurs since they are putting their trust in a brand new company which does not have a proven track record or a string of references to vouch for the company's product offering.

How will the new company compete for clients when it does not have a string of good references?

Here is one suggestion. The new agency may choose to offer a very competitive per hour pricing model and undercut the bigger more established companies. To accomplish this task the new startup must streamline overhead and avoid pricing in a profit margin.

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HOW TO START A SECURIT Y GUARD COMPANY Pricing On-Site Security Services Let's take a hypothetical look at a possible on-site security pricing model.

On-site security services are often priced by the hour. A security company will agree to work for a client for a certain number of hours each day. In some cases, the company may work according to different time increments such as hours per week or hours per month.

By the nature of the private security business, much of the per hour cost will consist of the security officer's salary. This amount may account for as much as 75 or 80 percent of the company's per-hour cost. Initially, the new agency must determine how to price the salaries of their officers. This information shouldn't be too hard to determine.

Many security officers will happily tell a passing inquisitor what they are paid each hour. Security companies are also constantly running help wanted ads and will likely disclose the amount paid with a simple phone call or may include the amount paid per hour within their help wanted advertisements. A quick visit to the local Craigslist' job page or the local newspaper classifieds should tell the observer everything they need to know about the local going rate for both unarmed and armed security services.

The company must apply its own philosophy to the art of setting salaries. It is to the startup agency's advantage to pay at least the same amount as the larger companies. For the sake of simplicity lets presume the going rate for an unarmed officer sits at $10 per hour.

The new agency should remember to add in the associated tax costs. Upon paying the officer his payroll, the new company must factor in for a FICA match of at least 8 percent. In the case of a $10 per hour salary approximately 80 cents must be contributed by the company. Additionally, unemployment insurance costs are also indexed to the officer's salary. This cost may vary based on the company's past experience with unemployment claims but as a rule of thumb the agency should probably budget at least 50 cents an hour for unemployment contributions.

The various ongoing legal and regulatory compliance, uniforms, paperwork and office supplies cost must also be taken into account and placed into the per-hour pricing model.

The agency's contingency fund should be indexed to at least 10 percent of the overall revenue.

In this example the hourly salary of $10, FICA of 80 cents, unemployment insurance at 50 cents, legal, paperwork, uniform and regulatory compliance at 40 cents and

SecurityOfficerHQ.com contingency of $1.20 adds up to $12.90 per hour. The agency can either take the next dime as margin for error or stay at $12.90 to emphasize the appearance of a low price.

Of course this model does not account for any overhead. That's okay! In the early days of the agency the avoidance of overhead cost is the primary method by which the company will attract new clients.

The time necessary to push the paperwork and schedule the posts presumably will be incurred by the owner. Some of these tasks might be assignable to one of the officers provided the post he is working allows for that luxury. By eliminating overhead and paperwork labor costs the company keeps a very streamlined business model.

Interestingly, the company does not have to make a profit for some time provided the owner is willing to work one of the posts himself. This is a very intriguing aspect of starting a security agency. If the owner was receiving $10 per hour to work for a large security company then why not work for himself and get paid the same money? This allows him to bring in a steady stream of income without needing to price in his personal overhead costs or profit margin.

It isn't wise to maintain this model forever. As the client base grows so will the related overhead costs. And the owner will want to make a profit sooner than later. When an owner is forced to work full time at one of his posts he has much less time to focus on bringing in new clients and keeping good relations with the ones that he has.

However, for the sake of bringing on board the first set of client references while also still maintaining an income, this strategy should be very successful in undercutting the competition while also rewarding the initial clients for putting their trust in the new security company.

Pricing Patrol Security Services Here is the basic concept. The security company provides security patrol services to clients who can not afford or do not need full time security services. The patrolman visits the client facility a set amount of times during an established time period. For example, the company may patrol a mini-storage facility four times between 10pm and 6am. This allows the officer to ensure that there hasn't been any vandalism and discourage theft. It may also allow the mini storage ownership to claim savings through reduced insurance costs.

So, how much should the security company charge for this service?

Patrol service must be charged at a significantly lower rate than on-site. This allows clients who need but can not afford on-site security services to claim this inexpensive

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15 alternative.

The client will likely pay the security company on a per-patrol basis.

The patrol pricing model must account for three primary costs. These are salary, office overhead such as insurance costs and vehicle expense, including fuel.

Again, a profit margin isn't factored in since this is presumably a new company which seeks to rapidly generate a client base.

The model must provide enough room for fuel inflation to prevent the company from having to raise rates every time a geopolitical event causes a hike in gas prices. This rapidly changing variable can play havoc with the per-patrol pricing model.

Let's assume for the sake of this example that the new security company charges $14 per hour for on-site security services. In this example we will base the company's patrol costs on its on-site pricing model.

Let's also assume that the company will be able to secure at least six patrol clients within the first few weeks of the patrol route's creation. We will base the pricing model on these six clients.

Hopefully the clients are located within a reasonable distance of each other thus keeping the miles in a given shift limited to about 120 miles per shift. A future ebook, entitled Running a Security Guard Company will address the issue of patrol route composition in great detail. Keep an eye out for the release of this ebook by visiting SecurityGuardHQ.com.

This shift will take eight hours. At an IRS reimbursement rate the vehicle expense will amount to about $60 per shift. The officer's salary at $10 per hour amounts to $80. FICA and associated overhead such as insurance and contingency funding adds approximately $30 of additional expense. This means the overhead for each shift is $170 in total. The company could build in at least an additional $20 to $30 per shift to give some leeway for fuel inflation. Thus, each shift costs the company a total of $200. This number provides plenty of room for contingency and fuel inflation.

For the sake of simplicity let's assume each client has requested four patrols per shift.

Simply divide the total number of 24 patrols from six clients into the $200 of cost. The company must charge $8 per patrol to cover expense. Thus each client will pay $32 per day or about $960 a month for the service. Compare this to an on-site client who would pay $14 per hour, or $112 per day for a total of $3,360 per month. Thus the patrol service costs just 29% of the on-site.

SecurityOfficerHQ.com It is always important to do a time audit of the patrol just to ensure it is feasible to provide adequate service to the six clients. Presumably the officer will be in transit across the 120 miles for at least three hours out of the eight hour shift. This leaves five hours for the actual patrols or 12.5 minutes for each patrol. The route could potentially accommodate another one or two additional clients. These additional clients will provide the opportunity to add in a profit margin and perhaps allow the company to lower the price for the patrol service.

It is important to remember that while not each patrol will take its allotted time some will take much more. A large motel will take up much more of the patrol officer's time than would a small office complex. Since the motel is filled with tenants it is likely that the officer will on occasion need to spend a long amount of time mitigating an incident.

This will push his other patrols off schedule. However, it is unlikely that the officer will ever need to spend more than his 12 allotted minutes at the vacant office complex. The company should probably factor this into their pricing model by charging more to the motel and less to the office complex.

Also, if the patrol officer acts in a supervisory capacity for the new security agency's on-site officers the time needed to visit with and back up those officers as necessary must be considered.

Finally, a bit of time should be factored in for the officer's break time as this might be mandated by local labor laws.

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Chapter

6

Develop a Documentation System The new security company must quickly develop a robust client base. Just getting one or two clients puts the new company in a bad situation. It is almost impossible for the company to pay all of its overhead when it only has a handful of clients.

Excluding salaries, the overhead costs for a security agency with two or three clients isn't that different from an agency with nine or ten clients. The agency can spread this overhead cost across ten clients and pay all of its bills while charging a reasonable rate per hour. A company which can't get beyond two or three clients can't spread out this cost.

This makes it very hard to become profitable.

Getting those first two or three clients is exciting and an important step. However, signing the initial nine or ten clients is much more important. Once the agency signs this many clients it should become profitable. Ideally, these first clients will serve as the references which will eventually leverage the company into a serious challenger for most security contracts.

The owner of the new security company must secure these clients as soon as possible. How does he do it?

First of all, and most importantly, he must approach the challenge from the mindset of documenting literally every single contact with a potential client.

He captures the documentation of these interactions inside of a data collection and retrieval system.

Many businesses re-evaluate their security needs on a periodic basis. This timing

SecurityOfficerHQ.com likely corresponds to either the business' fiscal year or when their contract with their existing security provider expires. Many of these existing contracts likely last for a set amount of time such as six months or more likely one year.

When the new security agency first solicits a business the chances are not good that the business is open to solicitations for security services. This can be a bit discouraging to the new security entrepreneur. But, he shouldn't see this as a bad sign and become discouraged. He should know that if he can just find out when the business will be accepting solicitations then he has engaged in a successful marketing action.

He now knows some of the ground rules to gain the perspective client's business. But none of this is any good if the security agency does not have a system in place to record and document the information.

By now the reader should clearly see the importance of documenting every marketing interaction. Maybe, in January, the new security agency owner attempts to bid for business from a local car lot. Perhaps he is told in January that the car lot is under contract with Securitas Security until August and thus the car lot isn't interested in talking to him.

This has been a successful interaction. The owner has just found out exactly what he needs to know. In July he must be prepared to put a bid together and get ready to compete for the contract.

Should he have failed to document this interaction in January then he might forget to check back in July. While this sounds unlikely, consider that the new security agency should be soliciting hundreds of potential clients. Without a good documenting system in place the agency owner could let many bidding opportunities slip away just because he does not remember who he talked to months earlier.

With the help of the documenting system he can ensure that he is in the right place at the right time to bid on business.

This documentation system could be as simple as an excel spreadsheet or even as antiquated as a library of index cards. But, if at all possible it should be database based.

Common database products, including Microsoft Access on the PC and Filemaker on the Mac, provide this solution.

Web-based customer relationship management software as a service program also fills this role. These come with some cost as the user must subscribe to use many of the Web-based customer relationship systems.

The security agency should use a database product where an entry can be made

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in January for a bidding opportunity in August. In July the company should be able to sort the list by all of those potential clients whose current security contracts are about to expire.

This system should be robust enough to accept other details about security companies and clients. In this way whenever the security agency collects a useful piece of information about a competing security company or potential client the system should archive this information. It will be important for the agency to know which competitor holds the contact for which they are bidding.

Before he solicits his first client the security company owner must establish a comprehensive data retention and retrieval system.

Chapter

7

Creating the Hook Too many security companies attempt to secure business from a client based on personality instead of value. Other agencies simply depend on the brand name of their business and do little to innovate or offer something extra to the client.

Have you ever been solicited to purchase a product only to conclude that no matter how much money you spent on this product it wouldn't add a bit value to your life? You know all too well that some salespeople attempt to sell a product without providing meaningful value. The same is true of the security industry. Any security service can get a license, hire an officer and send the officer out to work on a post. But, what makes the service better than the twenty other security companies in the same city?

The new security agency should feature a hook. This is a foundational principle so important and significant that it will become a part of his company's ethics and define the entire agency for years to come. In five years, when a generic stranger approaches

SecurityOfficerHQ.com a business to asks for a reference regarding the security company that business should respond with, "Oh yes! That's the security company that _________!"

What will the agency be known for? What is the hook that will immediately capture the attention and interest of the prospective client and forever brand the company?

The Criteria First of all it is important to understand the criteria for developing this feature.

To compete against the big brand names the new security company must differentiate its defining feature in a simple, easy-to-explain manner. Any hook or unique characteristic must be easy to explain. The security agency's ownership must have the ability to tell a client why their agency would provide the best option to the client within just a few minutes or within a couple of paragraphs of written text.

The feature should be be unique. It does little good to develop a special feature when several other area security companies offer the exact same feature.

The feature must have meaning and true value. Remember, this is the new company's defining reason for existence. It may be that no other local security company offers the feature for a reason. Maybe no one wants it. Will people be impressed when they realize what the feature will mean to them?

The feature should be something that can be tested and if not practical walked back.

If the feature proves to not have real value or does not attract the attention of those being solicited the company must be prepared to strategically pivot to a new defining feature without appearing too flaky.

The feature should be developed based on experience from the security industry.

The owner's experience working in the private security industry could prove vital in defining this feature. Perhaps over his career the owner has noticed the things that all companies do and those things they do not do. Maybe he has witnessed a breakdown in communications between his old employer and the employer's client. Did this cost the company its client? He may have noticed firsthand how whatever led to the fallout could have been prevented had the company offered a service or utilized a tool to better communicate with the client.

The Process for Sourcing the Hook Here, the fun begins! What follows are ideas for sourcing the distinguishing feature.

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The owner should source ideas from those who currently own businesses and have security services. This can be accomplished by finding and interviewing mutual contacts who are familiar with the challenge of retaining a security firm. Maybe the owner can find these mutual contacts at church or at a civic club where he attends. Perhaps, and most likely, he will need to cold source these individuals. There is nothing wrong with contacting a business owner and asking him to lunch. The security company owner should make it clear that he is not trying to sell anything but is simply doing some market research and wants to design his product to meet the needs of the market. If approached in a professional manner, many business owners might enjoy the chance to receive a free lunch and talk about their experiences with their security providers over the years.

During the interview the business owner should be asked to disclose the most frustrating aspect of dealing with security companies. This should lead to a detailed discussion of the merits of the various existing provider's services.

Once the business owner discloses the most frustrating aspect of dealing with security companies he should be asked to discuss the second most frustrating aspect.

Then the third and the fourth. Each of these problems will provide guidance as to how the new company should design its foremost feature.

It may be that the business owner expresses his dismay over the fact that no matter how hard he tries he can not drive down the cost of security services. He may be required to maintain a security presence in order to keep insurance rates down or maybe to honor a franchise agreement. Since he has been forced to hire security he has attempted to bid out the service only to find that each security company bids the same amount. It's almost as if the major security providers are colluding to keep prices high. Clearly the local market has room for a new company to drive down the price of security.

And, perhaps the lack of pricing transparency for security patrols frustrates him. He can't just call a security company on the phone and receive a price for a security patrol.

Why not? Maybe the market could use a security company which posts transparent prices.

Or, maybe he has been frustrated because he thinks the security company charges him for patrols they do not perform. He just can't bring himself to stay up all night watching for the officers to patrol. But, he has a nagging feeling that the officers are not giving him all of the patrols and also suspects they might be ghost answering alarm calls.

How can he prove any different without staying up all night or investing in expensive surveillance equipment? Perhaps a new security company could use smartphones to live post pictures from their patrols on the Web thus proving that they are really patrolling.

This innovative use of technology would allow the new company to offer a transparency feature not provided by other companies.

SecurityOfficerHQ.com Following a discussion of the shortcomings of the current providers the conversation should turn to discussing the areas where the current security company is meeting the need of the client. This will prove informational and may also help with the feature development process.

The security company owner should take detailed notes. All of the information disclosed during the interview should be recorded in his data retention and retrieval system discussed earlier. This insight will not only allow him to craft his service's features but also provide invaluable insight into the current state of the security industry, including the amount companies are charging, who their clients are and what types of technology they are using to provide their service.

After just a few of these interviews a trend will start to emerge.

For the purposes of this example let's assume the security agency owner has decided on his company's claim to fame. In interviewing those who currently hire security companies he ascertained that there was room in the local security market for a new company to offer quality security services at a lower price.

Perhaps the other companies in the market are charging $17 or $18 dollars per hour for on-site security and $10 per security patrol. If this is the case, then considering the math in the previous examples, it is clear that a new company can enter the market and take away business from the bigger more established companies. It can offer a significantly lower rate while providing the same, if not a higher, level of service.

Additionally, perhaps the new security company will also deploy a couple of new features to meet a need in the market as discussed during the interview with the business owner.

While affordable security services will be the company's claim to fame, the ownership will also highlight the professionalism of its officers, a comprehensive security offering with on-site officers backed-up by patrol officers who drive professional looking cars.

The company will also utilize an online reporting interface which provides the client with evidence of work. The interface allows the client near real-time access to the company's field reports. Thus, when the client walks in the door in the morning he can see the reports from the night before. Should there be a complaint or question about what occurred during the previous night's shift the client will be prepared and will already know the security officer's side of the story. The business owner will never again need to worry that his patrol officers might be conducting ghost patrols.

The reader may notice that this description has now taken up four paragraphs. It will be the responsibility of the owner or his salesperson to develop the knack of presenting

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these features in an organized and credible soundbyte. If the description of the company's service becomes too nuanced or lacks focus then the potential client may tune out and not grasp the concept offered by the security agency.

Certain clients may care about the company's economic pricing feature more than others. This is why it is important to develop several fallback features. When the first couple of features do not speak to the client's need then perhaps the third will.

When the owner solicits a client he will want to practice soundbyting the features.

The owner or his salesperson should learn what works and what doesn't. The client may respond well to a soundbyte that describes the company's mission of keeping overhead low in an effort to provide more affordable security to the market. However, he may react negatively if the salesperson says the company's mission is to provide cheap security. No one wants to pay for cheap security.

This part of the process requires presentation skills and the ability to present an innovative product in a positive light and in a concise, clear manner.

Future articles will discuss the importance of marketing materials and how to present the company's mission in an organized way in printed form.

Chapter

8

Specialization The owner of the new security agency should certainly aspire to compete for as many different types of security contracts as possible. But, his company's ability to effectively compete across all types of business sectors may not materialize for several years.

Initially it may be wise for the company to specialize in providing security to a certain type of clientele located within a target niche.

The owner likely has a bias in this regards based on his career in the private security

SecurityOfficerHQ.com industry. He may have spent years working at a certain type of facility. This may have allowed him to develop relationships with account managers at various institutions. These relationships could prove valuable as he solicits for business.

But, even if this is the case, there are several factors to think about when attempting to discern where to specialize.

Presumably the company will begin to specialize in the industry where it secures its first few clients. For instance, once the new security agency has three or four hotels it will seem logical for it to leverage these references to attract even more hotel clients. It is harder to use a hotel reference when attempting to solicit a client who owns an office park than in soliciting business from another hotel.

Oftentimes those who own businesses are very familiar with other businesses in the same industry. When a security company provides great service to one of these establishments the word of mouth spreads amongst businesses in that same industry.

One business owner may naturally tend to brag to an associate or competitor about the great deal he is getting on his security services. This also naturally tends to force the security company to specialize as it receives business based on this word of mouth.

Additionally, some types of businesses have many accounts spread out all across town. For instance, a property management company may serve 20 different apartment complexes in the same city. This means that a security company which specializes in providing officers to apartment complexes might secure 20 on-site posts with just one client account.

Perhaps the agency decides to specialize in security patrols of mini-storage units.

Some mini-storage chains may own a series of facilities spread out through the city. A company might dedicate an entire patrol route to just this one client. This client could provide the company with a security patrol that could be used to provide backup to the on-site clients within the vicinity of the mini storages. Thus there is value added to on-site clients.

Cost should also be considered. The cost to provide a night security patrol to a hotel or apartment complex is much higher than the mini storage or an office park. A hotel or apartment complex patrolman constantly faces the possibility of major security incident.

Resolving these incidents can be very time consuming. The night patrol officer at a mini storage or an office park rarely encounters a living being. This means almost all of his patrols are accomplished within a set amount of time and he can do more patrols per night. Should the company specialize in providing patrols to hotels or apartments it will almost certainly need to increase price.

In essence, the new security agency should attempt to gain its first clients in an

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industry where the owner is most comfortable, based on his career in private security.

Second, the company should look for opportunities within industries where word of mouth will quickly spread. Third, the ownership should consider the opportunities offered by industries where one client owns multiple facilities. This one client could instantly make the new company profitable. And, finally, the new agency should take into account the cost to provide a service to the industry within which it specializes.

In an earlier chapter I wrote about my security company's service of cataloguing the identities of those persons involved in security incidents. This allowed the company to potentially market the fact that it had collected security incident data from across the metro area. Specifically, because the company specialized in providing patrol and on-site security to motels and hotels the data was potentially especially important to these clients.

When a bad tenant had an underage drinking party and trashed out a room his data was subject to being placed in our database. When an officer evicted that tennant and told him not to come back the documentation of the warning should have also been placed into the database. When another officer came on shift and encountered the same troublemaker he might pull up the file and note that another officer had instructed the person not to return. This documentation could potentially allow for a trespass charge should conditions warrant.

This data wasn't siloed from site to site. A person evicted from one hotel might attempt to create an incident at another hotel. Our database could track the person from one site to another site.

Because our company specialized in providing services to a particular type of client the data collected at one site provided a benefit to a second site. This feature was something other security providers could not compete with. Thus, serving multiple clients within this target niche was a marketable advantage to our company. We could start to exert a dominance in the niche not just because we had a series of good references from that same industry but because we could offer a valuable service other companies couldn't provided. Best yet, the cost of providing this data service collection was minimal to our company and wasn't passed along to the client.

This one example speaks to the importance of specialization. A client who uses the company to secure his steel warehouse probably doesn't care about data from hotel sites.

This feature is of little value to him. But, other hotel clients most certainly appreciate the fact that their security company can spot those who would do harm to their facility and potentially mitigate the situation before things can get out of control.

No matter the industry, there will always be opportunities to provide a higher level of service due to the company's specialized focus. A company that focuses on providing security to apartment complexes could for instance also incorporate process service

SecurityOfficerHQ.com delivery with its security services.

Apartment managers are constantly needing to serve legal papers to non-paying tenants. A security company that provides security to apartment complexes should crosslicense some of its officers with a process server license.

The company can provide this service to the client as a benefit other companies may not match.

Aside from the cost of the license and accompanying bond, there isn't significant cost to the security company to offer this service. One of the company's patrol officers who holds a process server license can simply drop by the property and serve the papers with the assistance of the on-site officer.

Better still, the on-site officer can alert the patrol officer when the target of the process service is on the property. This is a luxury process servers do not normally have as they might need to make multiple visits to the location to serve papers. A tenant might be able to avoid the occasional visits of a process server but he can't avoid the on-site security officer for very long.

This type of synergy underlies the importance for niche specialization whenever possible.

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Chapter

9

Market Research It’s time to populate the database and perform a little market research of the local private security industry.

Security Industry Competitors The owner of the new security agency should start by creating a file within his database for each security company who offers security services in the market area.

As antiquated as it may seem the phone book is a good first starting placing. Many security companies will almost certainly have a business line which means they will also have a yellow page listing. This directory provides a great starting place for developing a comprehensive listing of competitors.

The Yellow Pages will also provide valuable intelligence. Security companies will purchase ads through which they advertise their services. These ads sometimes describe the specific services.

How does this help with market research?

If ABC company provides on-site security officers, security patrol, alarm monitoring and process service then the new security agency knows who it will compete with should it choose to offer one or all four of these services.

Companies who only offer on-site security are at a disadvantage to those who provide on-site and patrol.

SecurityOfficerHQ.com A company that offers process serving may be a strong competitor for apartment complex business because property managers may need their officer to serve papers to those who are not paying rent. All of this data provides helpful hints as to the strength of the competition. By carefully curating this data, the new agency's ownership should start to see trends develop. This may allow them to spot opportunities such as underserved areas of the market where the new agency could get off to a quick start.

The entity charged with licensing security agencies within the state or local jurisdiction will provide a list of licensed security companies upon request. In some cases the information can be found online. For example, the Department of Criminal Justice in the State of Virginia provides an online portal through which viewers can see a list of licensed security agencies. Not all jurisdictions provide this same convenience. But, they will provide the list upon request.

Keep in mind that certain security companies may simply contract with other companies to provide security service. So, just because a company isn't listed in the phone book or doesn't have a license don't assume they are not active in the market via a third party company.

Each of these companies must be entered into the new agency's database tracking system.

Each company must be matched with its list of client companies. Perhaps while soliciting ABC office complex the new security company owner is told that ABC utilizes the services of US Security. It is vital for the owner to note this fact inside his file for US Security. Maybe, months later word gets out that US Security has decided to leave the local market. Upon hearing this the new company should have a list of prime targets for solicitation including the ABC office complex.

Remember, even if the new company can not afford to use software for this system they could use a utility as primitive as index cards. Bottom line, this data will keep the company's efforts to monitor the competition organized and comprehensive.

Potential Clients Its time to start developing a database of possible clients. The phone book provides a great starting point. Most businesses listed in the phone book won't need security.

However, this shouldn't stop the agency from starting a database file for each entity within their area of initial specialization.

Let's say the new security agency chooses to specialize in offering security to construction sites. The company should start a file for each home builder and construction contractor in the metro area.

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The agency must remember that there are different types of contractors and these may be spread out amongst several different categories in the phone book. Each of these companies should be entered into the database. Once the security agency makes contact with the company and determines that they never use security then the database will be updated to reflect that fact. Until that time each construction company file should be considered as a live round.

Many of these companies will have websites. The website offers the opportunity to research the company. How many employees do they have? A large company is more likely to be successful and thus more likely to need security. A very large company may already have numerous security officers and might not be willing to take a risk on a new startup security company. A small construction company may be a prime candidate for security patrol services since this will better match their budget than the on-site services offered by large security companies.

Additionally, this research may tell the security company who they need to talk to.

In the future, SecurityOfficerHQ.com will feature an ebook entitled Finding Clients For Your Security Agency which will feature content about getting past the gatekeeper and directly to the contact person. This is one of the most challenging aspects of soliciting for business. The agency may be able to locate the company's general manager and the account manager from the target company's website. The site may even contain directions on how to submit a proposal.

Any substantive information gleaned from these reviews, especially the identity of a contact person, must be recorded in the database. Eventually the new agency will want to match up each potential client with their current security provider and the expiration date of any contractual agreement they may have in place.

SecurityOfficerHQ.com

Chapter

10

The Legal Paperwork There are many Internet articles and ebooks about starting a new business. Anyone who starts a new business is well advised to review this material even though it isn't specific to the security industry.

This ebook mostly focuses on the legal specifics of starting a security guard agency.

So, with this brief exception, it won't address too much of the generic "starting a business" content that is readily available on the Internet. There are a few important steps that the new security agency owner must keep in mind and should take before soliciting his first prospective client. The owner must form the official legal entity for the business, meet the licensing requirements of the licensing jurisdiction and obtain the insurance necessary to meet the requirements of law.

Traditionally a company will form as either a corporation or LLC. Using these forms of legal structure are important to segregate the assets of the owner from those of the business. There will be a bit of a cost to file the paperwork with the appropriate legal authority in the state where the owner files these documents. The cost probably shouldn't exceed a couple of hundred dollars at the most.

The agency will likely be required to apply for a security agency license. Licensing mostly takes place through the same state government agencies or police departments which license individual security officers. These government agencies also provide licenses to security companies. Each state will have its own set of qualifications and requirements which the owner of the company must meet. Some of these requirements might be a bit onerous such as requiring the owner to have worked a certain number of years in the security industry and in a supervisory capacity. The prospective owner of a security company should carefully investigate these rules and guidelines prior to making

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any expenditure on the new company. This will ensure he does not start creating a company only to later realize he does not meet qualifications.

The company may need to meet certain stipulations prior to being approved for a license. One of the most important stipulations relates to the provision of general liability insurance. The purchase of this policy represents one of the most important and expensive items the new company must incur. The owner should shop around this policy to keep rates as low as possible.

The company will also need to meet other state and federal tax and insurance requirements. This includes registering for an employee identification number with the IRS and withholding FICA payments from employees’ paychecks (the business should be able do this by visiting the IRS website), signing up to make unemployment insurance contributions as required and purchasing a workers' compensation insurance policy. Once again, the owner should source every provider of workers' compensation insurance in an effort to find the lowest premium.

These steps represent the absolutely essential legal actions that must be taken in most if not all jurisdictions. There may be others depending on specific local legal requirements. It is important for the owner to conduct a bit of research to ensure that he meets all of these requirements.

SecurityOfficerHQ.com

Chapter

11

Operating Policies and Procedures Prior to soliciting clients, the owner of the new security company must put his company's policies and procedures into place.

There are two types of policies and procedures.

Standard Operating Procedures The standard operating procedures apply to the company as a whole. These are the policies that new employees will agree to abide by. They include the policies that govern everything from employee break policy to sexual harassment and complaint protocol, uniform use and use of force. In essence, the policies affirm the new company's commitment to ensuring its employees do not break the law. The reader will find a plethora of examples of standard operating procedures available on the Internet. These examples should be customized to meet the company's specific needs.

The company should also develop a basic compliance agreement which each new employee will be asked to sign. The document will allow the employee to assert that he has read the standard operating procedures and agrees to abide by them.

As a part of the new-hire paperwork, the new agency should design a form for officers to sign off on upon the assignment of equipment. Each new security officer should also be asked to sign his permission for the company to withhold from his paycheck any company items assigned to his custody that are not returned to the company. The document

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should itemize each assigned item with a description and value amount. This document is important in the event the company provides uniforms or equipment to the officer and the officer does not return those items. Without this document the company should never attempt to withhold the pay from an employee even if the employee has taken company equipment and not returned it.

Post Orders Post orders represent a site-specific set of company policies. The company creates this document so as to establish guidelines for the officer's conduct while on post. Each type of facility the company expects to service should have its own standard boilerplate post orders. A hotel client would use a different post orders document than would a car lot client, although some of the material would likely be a bit similar. For example, a significant part of the hotel post orders would address the procedure for evicting a client.

Obviously this material should not be a part of the car lot's post orders since there are no tenants. But, the same language which mandates the officer to patrol once every hour may be applicable to both locations.

Each client, once signed up, should be asked to approve and sign off on their site orders. This provides the security company with the protection of having received the client's approval for the protocol that will govern the conduct of the officer. At this time the client may want to amend or add site-specific guidelines to those orders.

Over time, both the company's policies and post orders will evolve with circumstance.

The company should save an original copy of the original material in a form where it may be quickly edited as necessary.

These important documents provide the company with an array of protections should a legal issue arise.

SecurityOfficerHQ.com

Chapter

12

Marketing Materials The marketing materials must be developed with care as they may be the client's first impression of the new company.

In this case, even though much of this book focuses on cost streamlining, this is an area where the company must expend resources as necessary to ensure quality. As the reader may recall from reading chapter 4, the upfront expenditure for marketing materials will likely amount to 1/7th of the minimum suggested upfront investment.

Prior to soliciting clients, the new agency must develop a nice-looking marketing portfolio. This material will accompany each bid the company submits. It will also provide the outline for the owner or his salesperson's presentation. More on that at a later date.

The brochure must distill the company's features into a concise presentation. Each feature should be presented in a bullet type list format. When a salesperson visits with the client he will start at the first and most important bullet point and work through the points one by one. As time passes, and the company grows, the brochure must be updated with each new printing. Eventually the bullet points will include information such as the number of properties served and will also list out the company's best references.

For example, consider the following bullet points describing the features referenced in chapter 7 about developing a hook or distinguishing feature.

- ABC Security Inc. was formed by security veteran John Smith after Smith noted that many security agencies continually priced services at a much higher rate than necessary.

By keeping overhead low and through the use of technology, ABC Security provides a higher level of professional security services at a lower cost to the customer than other

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metro-area security providers.

- In addition to on-site security, ABC Security also provides security patrol. ABC Security patrol officers provide strategic support and reinforcement to on-site officers.

This allows ABC Security's customers to draw on the services of a team of well-trained officers without incurring additional cost.

- ABC Security provides its clients with near real-time online reporting. ABC customers can view their reports through a secure, Web-based, transparency portal. This paperless process provides accountability to the customers and allows ABC to cut transaction costs.

ABC passes this savings along to the customer.

Note how these three bullet points are arranged in order of importance. Each point potentially differentiates the company from the competition. Additionally, the points provide support to each other. A customer might have a negative reaction to the first point simply because he does not believe it is possible to cut cost and not hurt quality.

However, the third point reinforces the first by demonstrating how the company can afford to keep costs low. Of course this isn't the purpose of the third point. The reinforcement is just a bonus.

Over time, as the company grows, the marketing material may evolve to include additional bullet points like the following.

- Over the past few years, ABC Security has provided its brand of affordable security services to more than 30 clients in the Springfield metro area. Please see the attached list of satisfied references.

The materials should include high quality photography. Various stock photos can be found online should they be needed. However, as soon as possible the materials should be updated to include actual photos of the company's officers and vehicles if applicable.

The new security agency owner should shop around the marketing material design and production to numerous printers to ensure he receives the lowest possible cost.

These marketing materials are the face of the company. It is especially important for an agency that markets itself as providing low-cost security to produce high quality marketing materials. The quality of material will help fight any impression that the company may provide low-quality services simply because they charge a lower price.

SecurityOfficerHQ.com

Chapter

13

End of Part 1 - Review Let's take a moment to review the steps covered in the previous chapters. So far these articles have taken the owner through a series of the very first and most important steps to starting a security company.

The owner of the new security agency must develop a data retention and retrieval system. This system will track all of the area businesses that might have a need for security services. It will contain data such as the contact person for each business and the time of year when the business takes bids for security services. Additionally, the system will track each of the other security agencies within the company's service area.

The system allows the company owner to gauge the strength of the competition and attempt to sign the clients of those agencies who are no longer providing quality security services.

The new security company needs to define itself. What does the company offer that makes it special? What will the company be known for?

The company's defining feature must be easily explained. It must be a desired feature and should be developed based on market research.

The security agency should consider developing a specialization or type of client niche that it will initially focus on dominating. This focus should be based on the expertise of the owner if possible. By focusing on a single niche the company will build a strong reference base related to its targeted industry. Word about the security company may quickly spread through the target industry thus providing the company with recognition and a richer universe of clients.

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The new company should conduct a market research process to determine the types of businesses available to solicit as possible clients. This research should also include other security companies that are in competition with the new company. The owner may be able to target areas of the security industry where the competition is weak and the clients underserved. All of the information from the research should be inputted into the company's database. Upon review, the system will provide an overview of those businesses that utilize security, the ones that need security but don't have it, the names of competitor security companies and the clients they work for and the date when the client puts the security service out to bid.

The company must go through all of the legal hurdles to become an official entity.

This means submitting its legal structure to the appropriate government entities and meeting the state's licensing requirements such as purchasing general liability insurance.

The agency must meet federal and state laws and tax policy, including the provision of workers' compensation insurance, unemployment insurance contributions and withholding employee FICA payments.

Finally, the new company must put into place the array of policies and procedures, standard post orders and develop marketing materials. Samples for all of this can be found through Google searches. All of the new agency's security officers will be asked to sign off on the policies and post orders. The company should ensure its marketing materials are first class as these materials will create an important initial impression in the mind of the potential client.

These important first steps take care of many of the routine items necessary before the company initiates its efforts to sign up clients and start providing security services.

SecurityOfficerHQ.com

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Setting Up A Communications Infrastructure The owner of a new company makes a big mistake when he sets up a costly communications infrastructure requiring a monthly subscription fee. A new company simply can not afford to pay these costs. Staying away from this expensive mistake provides the company with a great opportunity to avoid the monthly costs that haunt so many of their competitors.

Using innovative strategies to avoid this expense gives the new company the advantage it needs to keep cost low while establishing a foothold in the local security market. Here are some of those innovative strategies.

Business Line and Dispatch Many phone companies will charge $60 or $70 for a business line. The new company can mitigate this cost by using a free service such as Google Voice to take its calls.

Additionally, Google Voice provides a series of benefits such as the ability to forward calls to multiple phone numbers. This means that a patrol officer can take company calls while in the field and on his cell phone. Using a system such as this the new agency essentially provides 24 hour dispatch service without having to set up a location to take calls or hire a dispatcher. This keeps the company from being tied to a traditional infrastructure with an office and a person assigned to take phone calls.

All of this saves cost and keeps overhead low.

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The success of the new security company will very much orient around its ability to keep overhead low and absolutely avoid ongoing monthly costs such as business phone lines. Services such as Google Voice allow the company to avoid this cost.

Google Voice allows its users to pick the number for their phone line. The new company should reserve a phone number that is memorable and recognizable. It should pick a phone number prefix which is commonly used by businesses within the region where many of its potential clients are located. When reviewing the security agency's marketing materials, the potential client might award the agency a couple of extra consideration points if they notice that the agency shares the same area code and dialing prefix. This reinforces the impression that the security company is invested in the local community.

Here is the downside to this approach. Using a Google Voice number likely means the company will not have a Yellow Pages listing. This will result in a loss of some business just because someone who is looking for security agencies in the Yellow Pages will not find the new agency. Also, as part of their due diligence research, clients may cross reference with the Yellow Pages. It may raise a red flag of concern when they notice the company does not have a Yellow Page listing. This is easily explained if the potential client provides the security agency with the courtesy of a phone call asking them why they are not listed. But, it is hard to know how many companies will simply exclude the new security agency from consideration without ever telling the agency why they were disqualified from consideration.

Some Yellow Page directories will allow a company to buy placement inside of the Yellow Pages even if the company uses an unorthodox approach like Google Voice or just uses cell phones for business purposes. The owner of the new security company should contact the local Yellow Pages providers to find out how much it will cost to purchase this listing. If the price is reasonable then this may present the perfect compromise that allows the company to avoid the cost of a business line, takes advantage of the flexibility of a service such as Google Voice and still maintains a listing in the Yellow Pages.

Internal Communications Now, let's review the strategies for a no-cost internal communications infrastructure.

The internal communications infrastructure connects the security company's officers with a centralized dispatch system. Some companies make the mistake of attempting to purchase access to radio bandwidth. This is a huge mistake. Not only could the bandwidth prove costly but the openness of the communications allows the competition to eavesdrop on the new agency's internal radio traffic.

This provides the competition with opportunity to discover the identity of the new company's clients and when the new agency's officers make a mistake those who are

SecurityOfficerHQ.com eavesdropping may hear it take place and attempt to exploit it.

Should a client require more than one officer on a single post then the company may want to purchase a couple of inexpensive radios that communicate with each other across a short range. These will obviously not require an ongoing subscription cost and won't likely be intercepted by competitors since they are located within a single site.

For the most part, the new agency's communication needs can be met through the use of cellphones. Most security officers have their own cell phone and won't have a problem with the occasional call to ensure they are on site or to dispatch them to help a needy tennant.

The cell phone system does have some drawbacks. For example, let's say that the company decides to use the Google Voice system described earlier. Let's also assume that the new company has signed up a large apartment complex and the complex management has given out the new security company's number to all of its tenants.

Perhaps a tenant notices that a security incident is developing in an apartment next to him. The tenant calls the new security company's number to report the incident and request help from security. The Google Voice number has been forwarded to one of the agency's patrol officers who answers the phone while conducting a patrol. At this point he has to take the call, put the caller on hold, call the officer who has been assigned to the apartment complex and direct him to the appropriate place. Had the patrol officer been connected with the apartment complex officer via radio he could have dispatched him to the apartment without ever having to put the caller on hold.

There is obviously some latency in this system. And, while it should work for the new security company it may not scale terribly well. At some point in the future, when the company gets bigger, they may need to upgrade the communications system.

Fortunately, there are ways to keep costs low while scaling the capabilities of the system. That however, is a subject for the Running a Security Guard Company ebook.

In the short term the company may want to consider setting up a special Google Voice number just for the apartment complex. The number could be set to forward directly to the cell phone of the officer who has been assigned to the complex. Each day, the number could be re-assigned as necessary should a different officer work the shift on that day.

This would allow incoming calls to bypass the centralized system and go directly to the officer. It also keeps the officer's private cell phone number out of the hands of those at the complex. This important safeguard protects the officer from having to take calls on his off-duty time.

So, what happens when an officer does not have his own cell phone? Some security

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positions may require that the officer bring his own phone as a condition of employment.

And most candidates for security positions will not have a problem with this. But, in the event that the officer does not have a phone, this shouldn't disqualify him from the job.

Fortunately, there are any number of pre-pay options available and the company can assign inexpensive prepaid phones for just a few dollars. In fact, the new agency should purchase a couple of these phones and put the minimum amount of minutes onto them just in case of an emergency. Should an on-site officer forget his phone or lose his phone then the patrol officer can drop by his site and provide him with one of the pre-pay phones as a backup communications device.

Remember, the new company should never get locked into any contract where they have to pay a monthly fee. The trick for keeping costs to the client low is to avoid any ongoing overhead costs whenever possible. Those items requiring a subscription are the worst type of cost simply because they are no longer discretionary. When times get tough the company can't just cut the cost of 20 cell phones which are under contract for the next 18 months. Inexpensive prepaid phones allow the company to avoid these costs.

There are some who will argue that by using this system the new company is just offsetting the cost of communications from the company to the officer. In fairness, should the officer be required to place any significant amount of time onto his cell plan then the company should consider reimbursing him for his expense. Most routine cell phone use shouldn't amount to any significant time and this should not be an issue.

The patrol officer almost certainly needs a smart phone. This will provide him with access to Web-based portals such as Google Voice. Using this access he can re-route the incoming phone calls as necessary. This also allows him to potentially file his patrol reports online which is essential if the company does not have an office. On-site officers likely do not need smart phones although the ability to receive and send text messages may provide the company with additional means to communicate with the officer. In fact, in the above example from the apartment complex, the patrol officer could have potentially sent a text to the on-site officer while still talking to the caller.

Finally, the new company will likely need to investigate each new client's site to ensure there are no cell coverage dead zones. It may be that certain carriers do not provide coverage while others do. This means an officer with a Verizon cell phone might be just fine while an officer with an AT&T phone will miss important dispatches.

The new security agency should be able to establish a robust communications infrastructure without any significant expense whatsoever. This important cost avoidance strategy presents one of the most important ways for the new agency to compete with the bigger, more established security companies.

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The Shift Report In an earlier chapter the importance of developing a set of policies, procedures and standard post orders was discussed. In addition to these documents, the company must also design and deploy a standard set of reporting documents. A reporting document informs the client of routine security actions such as patrols and provides them with a narrative regarding any security incidents which took place during a security shift. These forms must appear professional and provide the client with a clear picture of the site's security status.

On each shift the security officer must complete a shift report detailing his activity.

This provides protection in the event that an incident occurs. It documents that the officer performed his work as required by the post orders. It also potentially represents an important investigation aid should an incident occur.

Consider the following example.

A car located at a client's facility is stolen. Following the incident, the officer's patrol log will be consulted. This log shows when the officer conducted a patrol of the area and should assist the security company with narrowing the window when the theft could have taken place. The company can adjust the patrol strategy according to the analysis.

The shift report will differ depending on the type of client. A patrol client's shift report will not be as detailed as an on-site client. The shift report should contain a form for each action of significance the officer participates in and must provide an opportunity for the officer to note his observations. Consider the following text-only sample report. The form must be designed to hold this type information.

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HOW TO START A SECURIT Y GUARD COMPANY Site: Riverside Apartment Complex Officer: John Smith Date and Shift Time: December 31, 2013 | 22:00 - 06:00 22:00: SO Smith on duty 22:10: Initial site patrol - all appears secure 22:45: Patrolled site - nothing unusual noticed 23:15: Patrolled site - nothing unusual noticed

23:28: The sound of fireworks heard coming from the southwest side of the property.

Upon investigation, SO noted three juveniles from Apt #223 shooting fireworks on the west-side parking lot. SO requested the juveniles to stop and escorted them back to Apt #223.

00:15: Patrolled site - nothing unusual noticed 00:45: Patrolled site - nothing unusual noticed 01:30: Patrolled site - nothing unusual noticed 02:15: Patrolled site - noted several individuals congregating outside of Apt #110.

Upon approach SO observed several open containers of alcohol. SO informed the individuals that it is against complex policy and local ordinance to possess open containers of alcohol in public.

02:45: Patrolled site - individuals noted on previous log entry still outside of Apt #110 with open containers of alcohol. SO made contact with responsible party, Mike Wilson in Apt #112, who agreed to ask his guests to stay inside while drinking. See incident report #2013-01.

03:50: Patrolled site - nothing unusual noticed 04:20: Patrolled site - nothing unusual noticed 05:30: Patrolled site - noted that a red Chevrolet Caprice, with Delaware tag 436851 appears to have been broken into. The driver's side window has been broken out. The car does not have a radio and several wires are leading out of the area where the radio is normally located. SO is unsure of location of the owner. See incident report #2013-02.

05:50: Police on site to take report regarding vehicle vandalism.

SecurityOfficerHQ.com 06:10: Owner of vehicle located: SO provided him with a copy of the incident report number and ABC Security agency contact number.

06:25: SO off duty The blank shift report must contain enough room for these types of entries. As the reader can see, it is unlikely for this much information to comfortably fit within just one page. The form should be designed as a two page report in order to provide enough room for each entry.

The integrity of this process must be carefully defended. Officers who falsify patrol entries must be subject to termination. Thus, when designing the form the new security company should highlight the commitment of the signatory to the authenticity of the data presented. A statement such as the following should suffice. "I the undersigned do hereby attest that the preceding entries are correct to the best of my knowledge."

This report may be designed using any of the traditional word processing applications available for PC platforms. This includes the Microsoft Office software or Microsoft Publisher for the PC and Adobe's InDesign for the Mac. The next chapter will analyze the components of an incident report.

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Chapter

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The Incident Report - Taking a Bad Situation and Turning It Into a Positive A recent article discussed the importance of an agency to provide its security officers with a form through which to report each shift's activities. In addition to the basic shift report a company must also provide its officers with standard incident report forms.

The incident report form provides the mechanism through which the officer submits the standard who, what, when, where, why and how of an incident per his security training.

Agency management should view the occurrence of a security incident as an opportunity for the agency. This may seem counterintuitive.

Perhaps the client, an inner-city car lot, entered into a contract with the security agency because cars were being vandalized on an ongoing basis. The client wanted to bring an end to this situation and by hiring a security company expected these occurrences to come to an end.

But, now, even though the company's officer was on post, another vandalism has taken place. Maybe more than one vandalism has occurred over the course of multiple shifts. This fact represents an embarrassment to the security agency.

This shouldn't be seen as a weakness but an opportunity. The occurrence of these types of incidents happen to every security agency. The company's true test comes after the vandalism takes place. The agency ownership may give in to the temptation to make excuses or upsell unnecessary, additional security services such as the placement of a second security officer on shift.

The security agency should view the continued vandalism as an opportunity to provide

SecurityOfficerHQ.com a valuable service to the client. This is why it is important for the agency to think through how it will handle the occurrence of incidents. The agency's ownership must be prepared to turn a bad incident into an opportunity to impress. The agency can either lose its client and give up the site to one of its competitors or strategize on truly ending the vandalisms and potentially winning the client's business for years into the future. The response should so impress the client that they may actually come to appreciate the security agency more after the occurrence of the incident than before.

The incident management strategy revolves around the company's standard incident report. A well-designed incident report allows the officer to properly express the who, what, when, where, why and how in a factual manner. This two-sided report should be designed for the officer to explain the standard facts of the incident on the upper half of the front page. Starting at about the halfway point of the front page and proceeding through the majority of the back page the form must provide the officer with the opportunity to write his narrative.

Numerous examples of these reports may be found through a simple Google search for security incident report samples.

It is crucial for the company to design a unique incident report for each type of facility served. In this way the upper half of the report will contain relevant data entry fields for the specific facility. Too many companies make the mistake of providing a single incident report for all of its clients. A report designed for the car lot as mentioned above should ideally contain very different data entry points than a report used by the security officer to report an incident at an apartment complex. The data points for a car lot should accept input from the officer about vehicle make and model and vandalism-type incidents. The data points for the apartment complex would focus on recording apartment-specific data such as the apartment number and complaint-type incidents such as a noise complaint.

A customized incident report will most certainly impress the client.

A well-designed and professionally composed incident report could prove invaluable when the client files an insurance claim or the incident is adjudicated through the court system. The report will substantiate the client's insurance claim and might make the difference between its award or its denial. Additionally, the report's professionalism could provide protection to the agency's officers when they testify in court.

The completion of this form will provide the most important first step of the agency's incident management system. It must be designed in a professional manner that impresses the client with the company's professionalism.

Look for much more detail about the best practices for incident response within the Running a Security Guard Company ebook.

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Chapter

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Other Reports The security officer's portfolio of reports depends mostly on the standard shift report and the incident report. However, there are a series of other forms which the new security agency should design and provide to the security officer. These forms are the accident report, supplemental witness narrative, internal supplemental incident report and sitespecific forms.

Vehicular Accident Report Officers who work sites containing large parking lots should have access to vehicle accident report forms. In the case of minor car accidents this form may be the only official document filed related to the accident. Law enforcement agencies do not always work an accident that takes place on private property unless the damage from the accident exceeds a certain damage threshold. As the reader can see, the security officer's accident report must be professional and correct as it could prove important for the participants in the accident and the client upon whose property the accident occurred. A professionally composed accident report may solve disputes between insurance companies and protect the client's right to an insurance claim.

Officers who frequently respond to accidents on heavily trafficked parking lots or privately owned streets should take an accident reporting class from a licensed private security school. The officer's ability to compose an accurate and comprehensive accident report serves as an excellent reason for why the client should retain the security agency.

Not all agencies offer the services of trained accident investigators. This feature could make the security company eligible for business when few other security companies could qualify.

SecurityOfficerHQ.com There are a number of accident report samples across the Internet. The security agency should use a standard accident report form as used by many police departments.

This type of standardized form will be familiar to many insurance claims personnel and should allow the accident victim to experience a seamless insurance adjudication experience.

Some security companies may try to combine vehicle accident reports with standard incident reports on the same form. This is a wasteful and inefficient process as the security company files many reports where vehicle accident data entry fields are completely unnecessary. A vehicle accident report should feature outlines of the vehicles involved in the accident. This takes up valuable space that could be much better utilized for the officer's narrative should the report not need to include the description of a vehicle accident.

Witness Narrative Let's move on to the supplemental witness narrative. This form allows a witness to provide a statement related to the security incident. It should contain input fields for the name of the witness and relevant contact data enabling the report's reader to contact the witness should the need arise. The report must be attached to the master incident report.

It should be numbered with the case number of the master incident so as to enable quick retrieval. This supplemental not only collects the statement of a witness to an incident but also could be used to collect the statement of a victim even if the victim wasn't present at the scene of the incident. Essentially, any miscellaneous information related to the incident potentially becomes a part of the data collection process by virtue of the supplemental form.

The master incident report should contain a notation for each supplemental form collected. This keeps the supplemental form from becoming lost. The numbering system for the master form and the supplemental statements should be numbered in accordance with the assigned case number. A master incident report with a case number of 2013 0001 could have associated supplementals numbered as 2013 - 0001 - 1, 2013 - 0001 - 2, 2013 - 0001 - 3 etc.

Supplemental Incident Report The witness supplemental isn't the only supplemental form the company should design. As previously mentioned, the company should deploy an incident management system. A crucial component of this system includes the check and balance of having a supervisory officer file a supplemental report to an incident report when the performance or lack of performance by the on-site officer could be at question. This supplemental report serves as a type of internal investigation of the company's performance. It may also be used to adjust the company's on-site polices and post orders to better respond to a

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similar incident in the future. It also provides an important tool in assisting the company with carefully documenting employee performance.

For example, consider the story about the car lot which experienced a vehicle vandalism. A supplemental report might validate the fact that the on-site officer conducted a patrol of the property as reflected in his shift report and the vandalism likely took place after the patrol. Or, perhaps the supplemental report demonstrates that according to surveillance footage, the on-site officer did not patrol as required by post orders. Either way, the supplemental report preserves the integrity of the system.

This form should be designed to allow the officer plenty of narrative and a potential data entry field for internal recommendations.

Site-Specific Forms Finally, certain sites may require site-specific forms. The security company should consider developing a portfolio of these forms as a sales tool to solicit the business of the client facilities.

These forms could include parking violation notifications for shopping centers who must manage an orderly parking lot, process service forms and rent payment request forms for apartment complexes. Perhaps the company could produce employee citation forms for employers who have a lot of employees. These forms may prove useful when employees drive their vehicles across a large corporate campus and choose to ignore traffic rules.

Samples for these types of forms can be found online.

SecurityOfficerHQ.com

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XVIII. Building The Relationships That Pay Off It's not what you know! It's who you know! The reader has probably heard this statement before. This is a lesson that shouldn't be discovered the hard way.

I did learn this lesson the hard way. I can recall attempting to sell my security company's services. Sometimes it was like hitting my head on a brick wall. I knew that my company offered a better product at a lower price. Why couldn't the business I was soliciting realize this and sign up with my company?

This isn't an uncommon experience. In all too many cases the owner of a business contracts with a security company not based on the price or quality of service. He simply gives the business to a mutual contact. Maybe he attends the weekly chamber of commerce breakfast. His security provider also belongs to the chamber. The security provider serves on the board of the chamber and has a lot of political influence. The owner of the business wouldn't want to cause waves by firing the security company. He knows he could save some money but it just isn't worth it to him. Social status may be a big part of what makes him successful and he could lose more money and business by causing waves than he would save with the new security provider. It's all about the politics!

It is incumbent upon the owner of the new security agency to counter this disadvantage by becoming ingrained into the local community. He does this by joining local chamber of commerce organizations and civic groups such as Lions, Kiwanis and Rotary.

Upon attending meetings of the various groups the owner should avoid the temptation to immediately solicit business. He should simply make contacts and provide constructive input to the group. Maybe he could even offer to provide free security services at group

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events. In this way, he gets to know the powerful business leaders of the community without alienating them by aggressively pushing for business. There will come a time in the future, likely outside of the club environment, when the owner of the company will solicit businesses owned by the other members of the organization. When that happens the business ownership will almost certainly take the solicitation seriously as a preexisting relationship with the solicitor has already been formed.

Better still, business earned through relationship building will likely last far longer than business earned through routine solicitations. As previously mentioned, it isn't easy to fire someone and then sit next to the them at Rotary on the next day.

Additionally, the new security company executive should join all local associations of security companies and related industry groups. Some communities may not have a local security company association but many have private investigator associations into which security company executives will be welcomed.

Making friendships with other security company owners as part of a security association could prove of great benefit to the new company. Consider the following example.

Large security corporations enter into contracts with nationwide companies to provide security at sites all across the nation. In order to keep these important clients the corporations must provide security in many different locations across the country.

However, these companies do not always have a physical presence in each of these locations. They are forced to depend on local providers to sub-contract for the business.

They may simply call the local security association and ask if any of the members can sub-contract with them. The association is likely to award the referal to the new company provided the owner has made a positive contribution to the group. These types of contracts could prove especially lucrative as the large corporation may spend generously and even take a loss on the business simply because they want to maintain their contract with the nationwide company. And, in the future, if they are satisfied with the level of service provided by the sub-contractor, they will not hesitate to send future business.

It is never too soon to become involved in local civic organizations. The owner must exercise the luxury to form these important relationships before soliciting for business.

If possible, the security officer who plans on forming a new security company should join these organizations far in advance of starting the company. Those new contacts will evolve into the company's strong supporters and clients once the company opens its doors simply because they have already developed a friendship with the officer. They will view him as a friend and will naturally want him to succeed in this new endeavor.

It takes time but being in the right place and building key relationships will pay off.

SecurityOfficerHQ.com

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Security Officer Recruitment These days, security officer recruitment is as simple as placing a Craigslist ad.

It wasn't always this easy. Not just too long ago companies were forced to pay for classifieds with the local newspaper. They might spend money on an ad only to receive a set of candidates who did not work out. They also had to wait for the ad to run which caused delays while they needed to quickly fill a shift. Now, thanks to online job boards, responses may be received minutes after the posting goes online. Posts may be resubmitted and all of this costs the agency absolutely nothing.

The evolution of online job recruitment significantly cuts costs. However, officer recruitment and retention still presents the agency's owner with one of his biggest challenges.

The private security industry contains a significant number of participants who routinely migrate from security agency to security agency. Because there are almost always job openings within the local security market these officers may decide to switch companies whenever the most minor of disagreements takes place between themselves and their current employer. They quit their job without notice simply because they know that they can almost immediately go to work for any number of security companies.

On one hand, this dynamic ensures there is almost always a ready pool of job applicants that will respond to a help wanted ad. However, screening these applicants takes on a special importance. Does the agency really want to hire an applicant who has ended his employment on bad terms with three or four other security providers?

When screening applicants there is one primary factor which the company should apply. Does the applicant have a history of quitting jobs without notice to the employer?

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If so, he will likely repeat this habit upon the occurrence of a disagreement with the new security agency, his co-workers or a client.

Perhaps the agency needs the new officer to go to work right away. Maybe, the agency's previous security officer quit his job without notice thus placing the company in a very bad and desperate position. The agency may disregard the warning signs simply because the applicant already has state licensure and is ready to go to work immediately.

Out of expedience, the agency may look the other way and hire the officer even though the applicant floats from job to job and has a sketchy history.

This becomes a self perpetuating problem. When this officers drops off without notice the agency will again need to quickly hire a replacement and again may not have the luxury of performing due diligence.

Fortunately, free online job posting boards allow the agency to quickly post help wanted ads which allow the company to rapidly generate an eligible candidate pool. Using this resource, the agency just needs a few days notice in order to find a comparable replacement.

There are other free methods for recruiting officers. Those who migrate to a small security agency from one of the larger agencies may maintain their personal contacts within the previous company. These officers may assist in bringing their former co-workers to the new company.

Of course, the officer is more likely to serve as an ambassador for his new company if he likes the job. Thus the subject of the next chapter - officer retention.

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Security Officer Retention Small security agencies are significantly advantaged over their larger counterparts in that ownership can build personal relationships with each officer. This allows management to assign officers according to the criteria most favorable to keeping the officer happy and content.

The owner of the small company has the ability to know the strengths and weaknesses of his officers. The attentive owner will position the officer at a site where the strengths will be most beneficial and the weaknesses are not emphasized. For example, perhaps a security officer is training to serve in law enforcement. He needs to gain experience and isn't afraid of addressing and thwarting security incidents. This officer is best served with placement into an environment where aggressive security is needed. In this environment the officer gains the experience and training he needs.

Maybe a second officer fears confrontation but has a great personality and enjoys talking to the public. He will thrive at a security site where security incidents don't normally occur but where the officer must work with an orderly and non-confrontational segment of the population.

The first officer may do well with an assignment at a bar. The second officer would fit well at an office complex where he mans a front desk and provides access to employees and visitors. However, the second officer should never be assigned to the bar where he might have to break up fights on a nightly basis. Likewise, the first officer could feel trapped and restless at the office site where he would rarely learn from the occurrence of a security incident.

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Large companies all too often do not have the luxury of assessing their officers and matching each officer with a site where he will be happy. The small company's owner can get to know each officer personally and communicate with the officer when he has a problem or expresses frustration.

The owner must meet the challenge of knowing each officer personally. This allows him to establish a work environment customized to the officer and in so doing drive up the new agency's retention rate. This relationship will also prove beneficial whenever the agency needs the officer to fill an extra shift or stay late to complete an investigation.

The officer's relationship with the owner proves of benefit to the officer in more ways than one. Because he knows the owner he can get a direct response whenever he has a concern. Perhaps the officer has been treated badly or placed into an unsafe situation by a client. In a large agency it may be difficult for the officer to get the company to take his concerns seriously. However, because the officer personally knows the owner of a small agency he can make a phone call and ask that the unsafe conditions be immediately mitigated.

Perhaps the officer needs an advance on his pay to meet an unexpected bill. In a small company the owner may personally loan him the money he needs. This isn't likely to happen in a big company.

All of these are points the owner of the new security agency may use in recruiting new officers and creating an environment conducive to officer retention.

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Assembling A Sales Team Without Paying Anything Let's assume the new security company has met many of the prerequisites. The new security company executive has joined local civic clubs and started building the vital relationships necessary for future success. He has filed the necessary legal paperwork,

SecurityOfficerHQ.com created his company's identity, made the decision to target a certain segment of the private security market and put together some great security marketing materials. What comes next?

The owner must now determine how he will solicit new clients. This is in and of itself an art form. You will find more about this important process in the next chapter. Many security agency owners may dread and attempt to avoid this part of their job. But it goes without saying that without clients the company will never turn the corner and become successful.

If possible, the owner should endeavor to beat the pavement and sign up as many clients as possible. No one will speak for the company with the enthusiasm possessed by the owner. He does not require a sales commission and will know better than anyone else about the benefits offered by his new company. However, in order to make ends meet, the owner may need to personally work a security shift at the company's first security site.

This will limit the amount of time he has to run the company and certainly make it difficult to spend time soliciting new clients.

When the owner works a shift he probably isn't soliciting new clients. This presents him with a catch 22 situation. He must work a security shift to pay the bills but this keeps him from signing on the client base that will allow his company to turn the corner and become successful.

There is a science to signing up new clients while also keeping acquisition cost low.

The new company can probably not afford to pay a salaried salesperson. This would add significant cost and significantly increase overhead. As previously discussed, the new agency can compete against the better established security agencies by eliminating nearly all overhead while it becomes established and develops its initial set of references.

The agency should look for one or more salespersons who are willing to work as a contractor with a finder's fee for each client that the salesperson secures. Here is a suggestion for how to cash flow the services of a contract salesperson.

The company should require that all clients signed by the salesperson must pay according to a pre-invoice arrangement. This provides the new security company with the liquidity to award the salesperson's commission. It also allows the security agency to immediately pay the commission which should greatly incentivize the salesperson.

Of course, this form of compensation also creates a long-term liability for the agency.

At some point in the future, that client will cancel his account. When this happens the agency will need to cover the cost of labor and other costs without receiving compensation from the client.

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HOW TO START A SECURIT Y GUARD COMPANY Consider the following scenario.

Susan Jones signs up a security patrol client for the new ABC Security agency. The client signs up for three $8 patrols each night and pays his first month's pre-invoice which amounts to $720. ABC Security pays Susan this amount as her commission. However, three months later the new client does not pay his invoice. The client says that he does not need security services any more. ABC Security now has to account for the labor and vehicle expense that were necessary to effect the patrols during the preceding month. In other words, ABC has a $720 liability that will come due at some point in time.

In the preceding example the labor costs have been significantly disbursed as the patrol route likely has other clients who have not canceled their service.

However, check out the following example that presents a bit more liability.

Susan Jones finds a new eight hour per-day onsite security client for the ABC Security company. The client pays the pre-invoice of $2,880 or $12 per hour. Susan Jones receives a $1,500 commission. One year later, the contract expires and the client does not renew its invoice. The agency must still pay an officer $9 per hour plus insurance and related costs during the preceding month. The agency must come up with at least $2,520 in cash outlay to cover this cost. Perhaps the company has held onto the $1,380 in hold-over cash from the initial invoice that was not paid out in the sales commission. If so, this will certainly help out. But, it will still need to pay the $1,140 differential.

As you can see, this method of financing a salesperson comes with some liability. But it does allow the new security guard company to cash flow an initial sales campaign.

Should the new company decide to use this approach it should take the following steps.

First, the agency must do a little due diligence to ensure local labor and tax laws allow for this type of arrangement. The agency owner must realize that in order for the arrangement to pass legal muster he will not be able to coordinate or control the contract salesman's actions. The salesman can work as few or as many hours a week and there probably isn't any legal latitude for the agency to control his work activities. He is a contractor only and not a representative of the company. The company will need to issue a 10-99 tax form to the contractor at the end of each year.

Second, the agency's owner should check with his workers' compensation insurance provider to determine if he must pay insurance on the salesperson's commission payments. If so, the agency must calculate for this cost as well.

SecurityOfficerHQ.com Third, the owner should make it clear to the salesperson that all new clients will come under strict review prior to the agency agreeing to take them on. Local court records must be reviewed to see if there are any indications that the potential client has a past history of not paying invoices. If so, it probably isn't a good idea for the company to take on the liability.

Fourth, as soon as possible, the owner must set aside a contingency fund with an amount of cash representing a part of the outstanding deferred cost liabilities which will come due at some point.

Fortunately, there are a number of low or no cost forums for the agency to recruit commission-only contractors. The agency should constantly post the opportunity on services such as Craigslist and other job posting Web services. Using these free services the company can test different types of solicitations and judge the effectiveness of the advertisements based on how many potential sales contractors respond.

This commission-only system provides a number of benefits to the new company.

The company can sign up as many salespeople as are willing to work for commission.

There are few to no recruitment costs. The commissions can be cash flowed through preinvoicing. As the company grows, and has the latitude to actually hire a salesperson full time, this system will provide a farm team from which the company can recruit. And, if the system works, the owner of the company can focus on running the company instead of making sales calls.

All of this should be viewed as a secondary option to the owner personally signing on the new clients. When the owner finds a new client he doesn't need to worry about preinvoicing or future liabilities when the client cancels his accounts.

At the very least, the new company's client list should include a balanced portfolio of clients that were signed up by the owner and those financed through the commisiononly sales method. This will limit the financial risk to the company should several clients decide not to continue their services at the same time.

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Sourcing and Securing Contracts By Winning The Sales Experience Winning the battle for the client's business represents the very most important part of the new security agency owner's job. Once he starts his company the clock starts ticking.

The company must rapidly obtain enough clients to ensure its survival and spread out its overhead costs across several client accounts. The company that only secures a handful of clients risks never turning the corner to profitability. Unable to spread out costs, such as insurance, the new company can't compete against the large companies who distribute this cost amongst multiple clients.

There are three steps to this important process. These steps will be explained in great detail in the Finding Clients for Your New Security Agency ebook that is set for release in the near future at SecurityOfficerHQ.com.

Sourcing Clients As the owner of a new and small security agency, I was forced to utilize innovative approaches to source possible clients. This meant that I didn't always have the luxury of taking on the best clients. I had to source and find those clients who needed security but couldn't afford the bigger companies. And that was okay; it certainly made life interesting.

Through all of this, I learned the artform of finding and maybe even pioneering sourcing techniques. I had to find these clients or I could have never paid the bills.

I will write about this at some length in the Finding Clients for Your New Security Agency ebook.

SecurityOfficerHQ.com Designing the Bid The new company must design its bid in a way to compete with the large security companies. The lean organization which has minimized startup costs has a much wider latitude to construct a favorable bid package.

Competing In and Winning the Bidding and Sales Experience The owner of the company must be prepared to engage in the bidding and sales experience in a confident but calculated manner. In the Finding Clients for Your New Security Agency ebook I will share the lessons learned both good and bad from competing for clients in the bidding and sales experience.

Make sure to sign up for the email reminders from SecurityOfficerHQ.com to receive notice when Finding Clients for Your New Security Agency becomes available.

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Flexibility I think it’s important to include a quick word of advice based on my personal experience. The new security agency's owner must be prepared to flexibly provide services to new clients. Winning a security contract might take years. Or, it might only take hours after the security owner drops off his marketing materials. The owner must be ready for that call, " We need security, can you start tonight?"

It is actually surprising how many businesses will make a decision on the spur of the moment. Perhaps a construction company suddenly realizes that there isn't a security officer for a recently opened construction site. Maybe the company's insurance policy requires the presence of security. The construction safety management might notice that

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the new security company has just dropped off some marketing materials. He may pick up the phone and ask if the security company can start work right away. If the new agency refuses to work on such short notice the safety manager might turn to the Yellow Pages and find someone who will. However, by immediately assigning an officer the security agency could have the loyal business of that company for many years into the future.

The new agency should do whatever they can to meet these types of requests even if the owner must personally work the first few shifts. These types of spur-of-the-moment hirings do happen and the agency's flexibility may make the difference between success and failure.

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Conclusion This concludes the initial ebook about starting a security guard company. I hope the text has been of interest and was helpful.

Please keep an eye out for the continuation of this series of ebooks.

The ebook entitled Finding Clients for Your New Security Agency will take an in-depth look into the artform of creatively sourcing clients and effectively competing for their business. The ebook will walk the reader through the security product design process and provide ideas on how to source new security customers who haven't previously utilized private security services. The ebook will also provide detailed suggestions for aggressively competing in the sales process.

A third ebook will include advanced subject matter regarding strategies and policies for running a company on a day-to-day basis. The Running a Security Guard Company series will guide the reader through some of the methods for implementing a private security strategy that will appeal to clients without inflating the cost of the service.

SecurityOfficerHQ.com Keep an eye out for these two series. They should come soon to SecurityOfficerHQ. com.

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