Security Business

MAR 2014

Find news and information for the executive corporate security director, CSO, facility manager and assets protection manager on issues of policy, products, incidents, risk management, threat assessments and preparedness.

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86 www.SecurityInfoWatch.com | SD&I | March 2014 company. Taking consistent steps to maintain attrition rates at or below industry standards (about 12 percent gross attrition) establishes your company as a high-value business. In addition, monitoring and managing attri- tion helps your company identify and react to problems, and to develop procedures to minimize account aging and loss as well as maximize your revenue. 3. Adopt and follow standard operating procedures. Developing and implementing solid standard operating procedures will help your company provide excellent cus- tomer service for your subscribers, lower your attrition rates and increase revenue. When it comes time to sell your accounts, having good standard operating procedures enables you to provide crucial information to your potential buyer. While there is no right way to operate your company, your standard operating procedures should include: • Maintaining accurate subscriber and business records; • Reconciling accounts with your central station on a monthly basis; and • Adopting and following sound billing and collections practices, including cancel- ing accounts at 90 days past due. 4. Maintain valid subscriber agreements. Valid, enforceable, and assignable subscriber agreements not only help to establish your qualified account base, they are critical to pro- tecting both your company and your potential buyer — before, during and after the sale. Your subscriber agreements must comply with state and federal laws — especially those relating to consumer contracts for residential accounts — and include specific information and key provisions to protect your company from legal and financial liability. Without contracts meeting the necessary legal standards and providing appropriate protections to your company, most buyers will view your accounts as worth little, if any- thing. If your company has not documented every account with a valid agreement, you can still take protective remedial measures. Review your account records, identify any accounts that do not have proper contracts and have the subscribers sign new contracts. 5. Manage installation and monitoring to facilitate easy account transfers. The more difficult it is for a buyer to transfer and integrate your accounts into its monitoring system, the less the buyer will be willing to pay for those accounts. A high-value company anticipates the technical aspects of selling its accounts. It maintains good installation practices, such as setting up panels to receive downloads remotely, which eliminates the need for manual reprogramming. It uses stan- dard equipment that is technologically sound and scalable, accommodating advances in technology and increased subscriber needs. Contracting with your central station to have clean receiver lines and owning your toll-free receiver number (or IP address) is also essen- tial to ensuring your potential buyer will not encounter any technical issues in transferring your accounts to its central station. 6. Maintain an appropriate insurance program. Potential buyers not only look for the key elements that make your accounts a good investment, but also at whether you would be a sound business partner. One key indicator is how your company manages risk through insurance. The best way to make sure you have the right type and amount of insurance is to use a professional agent who will help your company put together a com- prehensive insurance program. This article was adapted from Alarm Capital Alliance's recent whitepaper, "Transforming Your Company into a High-Value Business," which is available at www.alarmcapital.com/ media-center/whitepapers. ❚ Amy V. Kothari is President and CEO of Alarm Capital Alliance. Under her leadership, ACA has grown to more than 170,000 customers nationwide, gener- ating $5.9 million of RMR. She received the Women's Security Council 2012 Women of the Year Award for the Dealer category. To request more info about ACA, visit www.securityinfowatch.com/10746349. YOUR BUSINESS When it comes time to sell your accounts, having good standard operating procedures enables you to provide crucial information to your potential buyer. SDI_84-87_0314 Kothari.indd 86 3/5/14 1:46 PM

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