Thinking of starting a Security company? There is money to be made in security. With talks of privatization of non-core policing function, global unrest and increasing hate and terrorist attacks, the opportunity is definitely there to make it big not only in Canada, but also in the US and world-wide.
The business model of security is fairly simple – you sell hours of guarding labour, quantities of system licenses, or amounts of certain hardware.
However, the Canadian landscape is littered with corpses of security and systems companies that died either instant, or slow and painful, death.
Here are 5 reasons that account for the failure of most security companies, in no particular order:
- Short on Cash – To make money, you need to spend money, and in security, you need to spend LOTS of money to get started, to advance forward, and to continue growing. Starters of failed security businesses often lack the necessary cash reserves to pay for immediate and long-term expenses (licenses, uniforms, lease, vehicles, and administrative support staff). You need to research and have a good understanding of how much is required, so that you don’t fold because you’re short.
- Legal Issues – Security is a very regulated industry, as it should be. Regulations relating to uniforms, vehicles, even canines. Every province has its own set of regulation and a governing body that enforces compliance to these. Penalties for not following the law can be very costly, and in some cases, spell the end to your business. In addition, there are health & safety rules, employment laws, and liability considerations that need to be taken into account as you are setting up and operating your business.
- Poor Service – There are tough clients out there, that is a given. However, there is much to be said about poor guard attitudes on site, lack of training, inability to provide guards on time, errors on invoices, lack of adequate uniforms or deportment, and non-responsive office support staff. These things drive clients away, and in big cities, where competition is cut-throat – they are not coming back….likely ever. You need to understand what clients are looking for, and be prepared to work VERY hard to keep them happy.
- Bad Morale – For many past companies, demoralized staff was the beginning of their end. The CEO’s focus on profitability at all costs and setting unachievable goals designed to encourage hard work tend to drive good people either away, or into medical leave (paid BTW). These people (field and office staff) migrate to other companies, and in many cases take their professional relationships with them. BAD. The security culture is somewhat different from many other workforce cultures, and you need to understand it, so that you can promote the good of security, instill a sense of purpose in your team, and demonstrate appreciation in meaningful, sustainable ways.
- Lack of Technology – Somewhat tied to Point #1, security start-ups and grow-ups are reluctant to invest in life-simplifying, critical management technology. By doing that, they fall behind more efficient, more presentable, slick competition. Software like Guard Center, which allows for reduction of overhead staff and a deeper, easier control of multiple accounts and sites, should be considered if you are serious about growing your business and keeping pace with your workload, your clients’ desires, and your competition.
Here’s to a prosperous security enterprise for you! Good Luck!