Re: Need Advice For Packaged Home Alarm Purchase

[Robert L Bass <sales@xxxxxxxxxxxxxxxxxxxxx>]

> No contract I have ever read claimed a hold on a rate
> for longer than ONE year.

While I owned a small central station alarm company for 24 years
I offered two options for monitored accounts.  The customer could
take a one-year contract, renewable annually with the price
guaranteed for three years or they could choose a three-year
contract with the price guaranteed for three years.  Either way,
the price was the same.  I billed residential clients annually.
The first year of monitoring service was included with the
purchase of any system.

My C-S was very small, located in an office attached to my home,
which had originally been a doctor's office / residence.  Because
we were not UL listed our overhead was lower than the typical c-s
alarm company.  As such, we were able to keep our prices a bit
lower than our competitors.  That worked quite well for us and
for our clients.  YMMV.

> Of course it's the perogative of any company to raise rates if
> they want, most contracts will give a optout to the client with
> a 30 day warning...

Nothing is universal.  Some firms offer fair and reasonable
terms.  Others don't.

> I've only lost ONE client in 20+ years due to rate increase
> of 6.00 PER year (50 cents per month).

I raised my annual rate $12 once and lost three out of the then
current 500 or so clients.  People expect an occasional increase
from any service provider.

> My lead salesman was a local manager of a big three letter
> corporate type alarmco for many years before he came to
> work for me and he told me of routine rate hikes of up to
> 7% at the time...

I've seen commercial fire alarm monitoring / service contracts
that ran from $50 to over $1,000 a month.  The highest was an ADT
corporate bid for a condo property (3 buildings) in Miami.  They
wanted over $140K for the installation plus $1500 a month for
service & monitoring.  Quarterly inspection visits were part of
the plan.  Given the scope of the project, I estimated that one
technician would need to spend between three and four hours per
quarterly visit.  Not bad beans if you can get it.

I sold the people the hardware for ~$19,000.  A local electrician
installed it for another $20,000-30,000 (I forget the exact
amount).  Last I heard they negotiated an inspection contract
with a UL listed outfit from the area that cost them about $350 a
month, including monitoring.

> If you have enough clients and you raise their rates a
> few percent - sure you may lose a few but the rmr
> goes up much more to justify it.

True indeed.  Furthermore, you usually lose the most difficult
ones when you raise the rate a few dollars.  FWIW, I have nothing
against dealers writing contracts that net them a fair price for
their hardware, work and knowledge.  I also happen to agree with
Bob C that long-term contracts, in and of themselves, rarely
offer anything of value to the consumer.

> And most companies will make compromises on a one-to-one
> basis if someone complains or threathens to cancel anyway.

Yep.  In the late eighties (I think that was it) we went through
a recession.  A lot of people in the insurance and technology
industries which were the main bread and butter of the Greater
Hartford area lost their jobs.  A number of our clients called
and told us they couldn't continue the monitoring Ellen they
received their annual invoices.  I asked each one if they had
lost a job.  Several said the had and I responded by waiving the
bill for one year.  After a year or two most found new jobs or
moved on.  Those who did never even considered changing alarm
companies.  They also referred me to many friends and family
members over the years.

--

Regards,
Robert L Bass

Bass Burglar Alarms
The Online DIY Store
http://www.BassBurglarAlarms.com