KEN KIRSCHENBAUM, ESQ ALARM - SECURITY INDUSTRY LEGAL EMAIL NEWSLETTER / THE ALARM EXCHANGE You can read all of our articles on our website. Having trouble getting our emails? Change your spam controls and whitelist ken@kirschenbaumesq.com ****************************** More on capitalizing on your monitoring accounts / ISC Schedule February 26, 2024 ************************** More on capitalizing on your monitoring accounts from article on February 13, 2024 ************************** Ken Found Feb 26 2024 post interesting. When you say multiples for wholesale stations are increasing, what multiples are you seeing and for what size of station in terms of number of accounts or amount of RMR? Regards, Victor Harding Harding Security Services Inc ***************************** Response ***************************** When the alarm industry thinks of selling alarm accounts its almost always talking about “retail” accounts; that is the contract between the alarm dealer and the end user customer. Alarm dealers often use “subcontractors” or “vendors” to provide the services offered to their customer. Perhaps the most common subcontractor is the wholesale central station, who provides the monitoring services. The industry hasn’t seen deals between central stations on the scale that we have seen alarm dealers for a number of reasons; the most obvious is that compared to alarm dealers there are only a handful of central stations. Central stations were unable to move accounts to another central station because the technology simply didn’t permit it. When that changed it was still a fairly expensive proposition to move the accounts, which would include move or re-directing the lines or communication paths and also doing thorough set-up of account details at the new central station so that signals could be properly interpreted and dispatched or responded to. Technology has changed that because communication lines are easily moved and customer data easily transferred. While labor and rent has no doubted increased over time the cost of providing communication pathways, the telephone, as decreased significantly. In short, monitoring alarm accounts can be and should be profitable; all you need are enough accounts to get the central station basic expenses covered. So central stations became interested in acquiring other central stations. The multiples were from 12 to 18 of the central station’s RMR. To answer Victor’s question directly, the “market” presently is high 20s multiple. It depends not just on number of monitored accounts but on the number of dealers, because they control the accounts. I mentioned that this “new program” was really quite similar to the incentives offered by central stations to sign up dealers. The typical incentives, depending on the bargaining power of the dealer, is 3 to maybe up to 12 months free or discounted monitoring charges. More likely a dealer was looking at up to 3 months free and slight break on published monitoring charges; maybe free set-up too. Now dealers can get over 24 months free; free set-up; guaranteed price for many years. But the dealer needs take the first step and call me or plan to attend the group meeting at ISC on this topic or schedule a private meeting with me if more than just curious. ************************************ ISC schedule ************************ Dealers who want to participate in private meetings with me or vendors listed on The Alarm Exchange should contact Stacy Spector,Esq at 516 747 6700 x 304 or sspector@Kirschenbaumesq.com to schedule a time. Vendors who wish K&K to schedule meetings for them during K&K's private and group meetings should contact Stacy Spector,Esq at 516 747 6700 x 304 or sspector@Kirschenbaumesq.com now. Meetings [private and group meetings on scheduled topics] will be schedule for half to one hour, without charge, and conducted at the Palazzo Prestige Lounge. Times and schedule is limited so please contact Stacy soon as possible to request a topic or schedule an appointment. *********************** STANDARD FORMS Alarm / Security / Fire and related Agreements click here: www.alarmcontracts.com *************************** CONCIERGE LAWYER SERVICE PROGRAM FOR THE ALARM INDUSTRY - You can check out the program and sign up here: https://www.kirschenbaumesq.com/page/concierge or contact our Program Coordinator Stacy Spector, Esq at 516 747 6700 x 304. *********************** ALARM ARTICLES: You can always read our Articles on our website at ww.kirschenbaumesq.com/page/alarm-articles updated daily ******************** THE ALARM EXCHANGE - the alarm industries leading classified and business exchange - updated daily ************************* Wondering how much your alarm company is worth? Click here: https://www.kirschenbaumesq.com/page/what-is-my-alarm-company-worth ****************************** Getting on our Email List / Email Articles archived: Many of you are forwarding these emails to friends or asking that others be added to the list. Sign up for our daily newsletter here: Sign Up. You can read articles and order alarm contracts on our web site www.alarmcontracts.com ************************** 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
