Starting a Security Company

[us722]

Hi all,

I am new around here and there's definitely some good advice from people so I thought I'll ask my share of questions. Over past few years, I've saved up a bit of money to start something of my own.

Now I've worked at a security company for quite some time in past when I was in school. Most of the security guards in Canada (malls, apartment complexes, warehouses) get paid anywhere from minimum wage to $18.00/ hr; but your company makes their profit on these contracts. My biggest attraction is lower start up costs and somewhat simplicity of the business. I have researched all the licenses requirements etc. in my province, Alberta and I feel that's not the hardest part.

My QUESTION to you guys is. Once you've registered your business, how do you start obtaining contracts? Do you cold call building management and try to set up a meeting to explain to them your services and hopefully beat the competition through competitive prices? I know that for most sites, there are contracts that range from few weeks to couple of years and companies bid on the site. How do you get to this bidding stage??

I thank you all with anticipation!

[akula]

hi...
well...let me get to your question by taking things from the top
there are people in the world who invest large amounts of money into things like events (i.e. sporting/music events) or real property (i.e. shopping malls), land (i.e. natural gas field) or assets (i.e. trains, shipments) etc etc etc

these people are concerned about their brand integrity and physical security of their assets for a number of reasons such as bad publicity (i.e gangs turning up to events), theft (i.e. shoplifting) or malicious damage (i.e. grafity) or public liability concerns (i.e. people walking onto a building site and having a brick fall on their head). the larger concern is brand integrity.

you want to be able to effectively solve one of these problems whilst still retaining profitability
to achieve your objective, what you don't want to do is try to compete on the lowest price because that will kill your profitability..as well as cause many other problems

firstly, what you need to do is to a) choose the correct target market and b) compete on differentiation
for example; rather than trying to compete where you have lots of competitors, you need to select a market where there is a unique security situation and where there is limited competition. for example, an offshore oil rig. that would be a hypothetical definition of a prospect with unique security concerns that can't be readily accommodated to by the wider security market. another example would be foreign companies operating in war zones etc..
ok..so, if you want to start a security a business, pick a market where you can win, rather than a market where all the winners have already been decided.

secondly, to compete on differentiation, you need to consult case studies and think carefully about the the competitive attributes of your solution. for example, in australia there is an extraordinary successful security business that guards supermarkets. the business is only a few years old. why are they successful? it's because they hire women, train the guards in customer service and make the guards wear pretty lemon coloured shirts. this is important because before this business got launched, supermarket operators only had the option to hire really scary, unapproachable guards who made supermarket customers uncomfortable. the new security company solved that problem for the supermarket because they offered them guards who could magnify the supermarket's customer service capability.

there are lots of other examples of successful security firms who have achieved market share based on a degree of differentiation rather than price competitiveness. it's possible that I may highlight these examples to you, but you really should be aware of them your self.

overall:

1. do not register your business before you have found customers.
2. to find customers, do problem formulation and identify a set of clients with unique security concern which are not able to be satisfied by the solution of putting a tattooed ex con on the door.
3. engineer a differentiated security solution to address the needs of your segmented target market. this may involve diffrentiated service attributes (i.e. providing guards trained in customer service) or other things like the ability to service geographic areas which are normally not serviceable.
4. get smart. have a very good understanding of case studies.
you should be able to name me at least 10 security firms who have done well over the past 10 years, and explain to me the fundamentals of their strategy for achieving success.

do you understand what I am saying to you?