KEN KIRSCHENBAUM, ESQ
ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE
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Comment on customer employing guards  / What do alarm companies sell for
July 8, 2019
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See webinar notice below:  cyber security – protect yourself and make money
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Comment on customer employing guards
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Ken,
            Regarding a church “religious entity” wanting to have its own security officers.  The easiest way would be to check with the individual state regulatory agency.  In Texas a business or entity can apply for its own security company license or a “letter of authority”.  A letter of authority covers only the entity listed.  This allows the entity to hire its own security officers (that have been properly trained and licensed by the state).  Whether the security officers are paid or volunteers (not compensated) makes no difference.  The entity, working under a letter of authority, cannot sub-out the security officers and has to meet the state required insurance coverage as well as other requirements.  The officer(s), however, can work for other security companies as long as they “list” with the other company or companies through the state.
            Ref: Texas Title 10 Chapter 1702 Sections: 181; 182; 183; 184
Regards,
Michael J. Moliere
MJM Private Security Services, LLC
Impact Security Training Center
Houston, TX 77084
832-250-0301
mjmoliere@comcast.net
www.mjmpss.com
www.impactstc.com
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Ken
            I know you are a successful attorney but you are learning a lot of money on the table by not doing stand-up comedy gigs  
P.S.  your reply was also spot on. 
Jim Wooster Sr
Alarm Financial Services
www. alarmfunding.com 
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Response
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            I believe it would be permissible for businesses [people too] to employ guards, armed or otherwise.  Like self-monitoring.  There is apparently regulations and laws to contend with, like Texas above.  Question is, is it really worth the effort and exposure to manage your own guard squad?  I suppose it makes a difference if it’s a few hours a week or several guards a shift for 24/7.  I’ll stick by my original assessment, especially if it’s armed guards you want on site; engage a guard company or your local police department.
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What do alarm companies sell for
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Ken,
            I purchased multiple contracts from your office recently along with in the past as well.  Had a couple of quick questions for you maybe you could answer. 
1.) How many times profit or revenue do Security Dealer's sell for? 
2.)  How many times profit or revenue are Security Dealers able to sell their Burglar Alarm accounts only for? 
            What would you say if I want to sell the whole business?  I do a lot of cameras and access control; what is the average multiple? of profit? revenue?
Thank you
Matt
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Response
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            If you use Kirschenbaum Standard Form Agreements ™ your starting starting point for where you can sell is 35 times RMR.  Whether you go up or down from there depends on other factors and can swing the price 10 times or more in either direction.  
            The chosen model in the alarm industry is Recurring Monthly Revenue.  Your other revenue and your profit may be interesting to look at, and may even affect the multiple, but it’s not going to be the basis of the sale.  
            Your camera business is probably making you a good cash flow and profit, but unless you are booking RMR you are not going to be selling to another alarm company.  Sure, any business can attract a buyer, and the more EBITDA you have the better your chance for selling.  But it’s not likely that the buyer is going to be a traditional RMR based alarm companies.
            The Standard Form Agreements, the All in One Agreements, are designed to maximize RMR, and that includes camera jobs.  There may be many different ways to operate and manage your business, be it home automation, strictly cameras or access control; maybe you don’t even do intrusion alarms or fire alarms.  That’s fine and you may have a very successful business and may be able to sell it for more than you hope for.  But it’s not the traditional alarm business. 
           You can check the value of your alarm business for $80 bucks at Whats My Alarm Company Worth 
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WEBINAR NOTICE:
Title:  What security integrators must know about cybersecurity
Description:  How to generate recurring revenue from cyber security and how to protect you and your customer from liability
When:  July 16, 2019  12 -1 PM EST
Hosted By: Ken Kirschenbaum, Esq.
Presented by:  Darnell Washington  dwashington@securexperts.com
Who should attend: Alarm company owners and general managers
Register here:  https://attendee.gotowebinar.com/register/7433795216423628545
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To order up to date Standard Form Alarm /  Security / Fire and related forms, click here:  www.alarmcontracts.com
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
www.KirschenbaumEsq.com