October 8, 2010
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Question:
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Ken:
I know that I have seen articles on your web site regarding the value of Monitoring Contracts if a company would sell them. Do you have any information on that on your web site?
Buzz Hoffman
Alliance Security & Automation, Inc.
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Answer:
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You can read prior articles at https://www.kirschenbaumesq.com/emailarticles.htm
If you use your Edit feature and then Find in Top Window or Search and Replace feature, you can put in terms that will search the page for the title of articles.
The formula for selling Monitoring Contracts in the alarm industry is based entirely on recurring monthly revenue under contract, a properly worded and enforceable contract. The multiple will depend on many factors, such as type of subscribers, type of systems, locale, competition, average length of remaining term on contracts, the terms and enforceability of the contracts, aging reports and more. The range can be from 10 x to 50 x. Average and medium will be around 28 to 35. Anyone can give me call for more personal evaluation. One thing is for sure, the valuation will be higher if you are using the Standard Form Contracts.