May 25, 2011
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Comment
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Dear Ken,
This is your best response ever! Thank you and I also appreciate the entertainment value!
Kind Regards,
Jeffrey S. Nunberg, President & CEO
Integrated Security Systems
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Here is my Response [from the May 6, 2011 email] referred to by Jeffrey:
Dealer programs have their place and there is no doubt that some, if not many, companies can benefit by participating in a program. The programs generally provide structure, advice, some provide marketing, of course capital, and instant name recognition.
However, I have not changed my position on these programs in all the years I have advised alarm companies. At the end of the day [end of your career] you want to own as much RMR as you can. The programs that require or even encourage you to sell your RMR to the program will suck you dry, leaving you with no equity and no retirement package. The cash flow that may be provided is not enough. You'd be better off getting a job as a salesman in an alarm company. At least then there would be no pretence that you're really operating and growing your own company, and you'd be astute enough to bargain for vacation time, health insurance and a 401K retirement package.
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Ken
AMEN!!!!! And BRAVO, Ken. You failed to mention such "programs" ultimately result in customer ill will and the prostitution of our entire industry as well. Telemarketing, neighborhood canvassing and "programs" are what make our industry the "used car salesmen" of the electronic security industry.
As for the guys who want to make a customer stick to the letter of a contract when the home or business is destroyed, comparing our product with a "flat screen TV" or other tangible, retail property, name one other industry which sells a package to a customer, bought from ADI for $89.00, plus an hours labor, usually collecting the $89.00 cost up front, then collecting a premium for the next 3 to 5 years. I don't mean to demean our product and service, but to compare it to a "flat screen TV" is absurd.
Do I want to collect the balance of a 3 year contract on a system that no longer exists, assuring I will be dispised and badmouthed for the next 20 years? Or do I want to work with a customer who has probably sufferred a substantial loss, thus making a loyal friend and customer forever? Hummm, let me think!
Paul Berry
VSA Security Systems, Inc.
Columbus, Georgia
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Hi Ken
Regarding your thoughts on dealer programs. Thank you, Thank you, Thank you. I am a new company and considered several dealer programs until recently. Brinks whom we all know changed names over night (which would have cost additional funds, not available to a startup to change the marketing, stationary, etc materials). Then recently I was seriously considering signing with Broadview about a year later. Thank God I followed my gut on that one and declined. After the ISC East I was preparing to sign up with Smith & Wesson. Again that relationship with the central station went south and only 30 days for the dealers to remove S&W from marketing and contracts. Something has to be said for divine intervention. Is there any legitimate dealer program that will stand for what they believe in and not be a sell out or practice misconduct for the almighty dollar? Guess I still believe in being my WORD when most aren't. Trust no one it seems. Bottom line...Strike 3 and I am out. I will stay on my own without a dealer program, even if it means sacrificing higher profits in a short amount of time. At the end of the day, I will be able to sleep knowing if the company fails or loses profit, it's my fault.
Thank you Ken and everyone involved in this newsletter including the readers.
Sincerely
Damian Cerrati
Intellisys Technologies LLC
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Dealer Programs –
Ken,
I read your email each morning and appreciate how valuable this resource is for all of us. Thank you. I believe that most of us are aware of your position on dealer programs. However, niche dealer programs can provide opportunities to dealers that may not be available otherwise. As we are rolling out our nationwide dealer program, we are experiencing a tremendous response because there is no inventory and we do not require credit checks or homeownership, so everyone qualifies, including renters. Dealers are able to sell their qualifying agreements to their existing dealer programs and place their non-qualifying agreements with us. Dealers monetize the marketing dollars they were throwing away on responses from renters and turndowns, which for some marketers is up to 65% of their marketing budget. This increases their ability to make every marketing dollar count. We believe that our dealer program provides invaluable benefit to our dealers and as credit quality continues to deteriorate our value to the dealer will only increase.
Respectfully,
Timothy Dunkin SR
www.press2assist.com