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how proprietary systems affect valuation / video door man and building escort service / Webinar tomorrow
May 6, 2019
Free Webinar - starts today.  Register now for May 7 presentation
Topic: Negotiating terms in Dealer Agreement with your central station 
When: May 7, 2019
Time: 12 PM to 1 PM New York time 
Presented by: Ken Kirschenbaum,Esq 
Who should attend: dealers and central stations 
Sign up here:
how proprietary systems affect valuation
            On the topic of selling alarm accounts, is there any advantage or disadvantage in a company that has mostly proprietary accounts like DMP, Edwards fire alarm or other systems where not all companies can service or get parts those systems?  It would seem to me that those "closed market" proprietary equipment companies would be worth less due to the reduced market they can sell to, unlike a basic company that has non-proprietary systems like basic Honeywell, Napco and Silent Knight, who anyone with basic training and experience can service and get parts for.  
            Also the restrictive contracts those companies must sign to get the dealership. Any thoughts on this? 
            Good question, one I think the brokers should comment on.  Though some issues are black and white, no pros and cons, just one or the other [like using the Standard Form Agreements], this issue does present opportunities.  On one hand, you obviously limit your potential market to sell the accounts.  On the other hand, you do offer "special" accounts to those qualified to service them.  
            If I am not mistaken, the DIY products share this concern.  Customers buy the equipment and if they don't want to pay RMR to the manufacturer the system becomes unusable and worthless, more or less.  
            I can't recall a deal where the multiple was changed, higher or lower, because of proprietary systems.  I can recall that some buyers were not interested because they could not service the proprietary accounts.  
  ​           I asked Robert Lintz to comment and his response was:

            I have had a few, not many buyers turn down deals from sellers that were not using more widely distributed and obtainable products. I have not seen any multiple adjustments due to traditional panel mixes. The buyer knows what is coming and either trains his personnel or hires the top tech from the selling company. Going forward, I do see a real possibility in adjustments coming with the DIY systems, as product support in the future could be iffy as the DIY market changes.
Robert Lintz
Listed on The Alarm Exchange

            Any brokers wish to contribute their expertise and comment?

video door man and building escort service
            Another option some alarm companies are offering is video door man and building escort service.  This service involves cameras and access control at the entrance door and throughout the building.  The systems are monitored 24/7 and access is granted remotely by the operator.
            The subscriber reduces or avoids doormen and is able to provide security throughout the building by electronically escorting someone throughout the building, such as someone going to the mail room, laundry room, in the elevators, delivery to an apartment unit.  The alarm company gets to install, service and monitor the cameras and access control equipment.  
            Think this isn't a service that the market can support?  Think again.  This service is already being provided in many cities.  It's for commercial customers, though how far off is RIng with its Video Doorbell and other similar products for consumer use?  
            Of course I wouldn't suggest another service without providing you with the proper contractual protection.  We have designed a special contract for the video doorman service.  It's not on our order page yet, so please call our Contract Administrator Eileen Wagda at 516 747 6700 x 312 to see if it's what you need.  

You can check out the program and sign up here: or contact our Program Coordinator Stacy Spector, Esq at 516 747 6700 x 304.

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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