Assistance greatly appreciated from the Experts

[ASPS Joe Security]

hello again!

[FireControlman]

Hello again. I last wrote on this forum a couple of months ago I believe. I recently started a Security Contractor company in El Paso, Texas. My company's name is ASPS Acosta Security and Patrol Services. I recently ran into a major problem in costing for patrol services. I'm trying to give my clients a fair local market price for patrol services that several have requested lately, however I feel that I'm doing something wrong in the way I price the services and I would appreciate any kind of assistance with someone knowledgeable in this field. I'm including all my basic expenses, including the Patro driver, vehicle mileage, vehicle maintenance,and estimated fuel expenses. Do I divide the expenses with the number of patrol accounts I acquire?? what if you only have one or two accounts, how do you do that. What about residential communities where they want private patrol to respond to incidents, do I charge them extra for every incident?? Do you charge by the HIT?? By how much time you spend at each hit??Is there a scientific formula out there that is fair to the consumer and still profitable for the contractor??? I can't find any books or training in this area anywhere.

Appreciate any assistance whatsoever.

This guy needs a mentor quick!

[Bill Warnock]

Joe, go to the members list and through a PM seek the counsel of Nathan Corbier and SecTrainer. For superlative report writing and client rapport assistance, seek assistance from Curtis Baillie.
Enjoy the day,
Bill

[kjtw]

ASPS - Some of us can offer some insight into this, however, what works for you, in your market, can be very different. You are going to have to make a number of decisions as to the specific operation of your patrol that will be based on your experience as well as knowledge.

You seem to have started out right by figuring out how much your patrol unit will cost you to operate. Make sure that you have taken into consideration all of your costs too...hidden costs really hit the bottom line. You need to make sure you take into account vehicle insurance, liability insurance and even operational expenses for the company. When you get this number correct, you can more accurately price your services. I always over estimated expenses to build in a buffer.

Going backwards a bit, another thing that you are going to have to know to get the number accurate is exactly how you are going to operate your patrol unit. If the car is running for 10 hours, the number will be different than it would be if you were running for 8 hours. Unfortunately, some of the factors that go into figuring out your expenses will vary from shift to shift and, even, from hour to hour. These variations are the reason for the over estimation.

Once you have an accurate cost figure, you will be able to establish sales targets in order to cover your costs. Spreading your costs across only one or two clients will result in a, frankly, unafordable and over priced service. So, in building a patrol division, you are going to be forced to have a period of time that it is not making a profit and, actually, is taking a loss. This loss must be able to be sustained by your other income sources.

As to exactly how you should charge, that depends on exactly how you are operating. If you are operating on a per hit basis, you have to determine what constitutes a hit. Have you tied it to a specific amount of time or is it open ended? If it is tied to time, then you have a threshold that can be crossed in order to charge the client for additional time. If there is no time tied to a hit, then you can't charge for additional time.

[ASPS Joe Security]

Bil and ktjw,

Thank you very much for the advise. I'll go through a PM and seek the counsel Mr. Corbier,SecTrainer,and Curtis Baille. ktjw, I had already included those hidden charges in trying to cover all the obvious expenses and potentially unseen expenses and realized that you really need volume in the accounts needed in order to be able to provide a good price to the client and still make somewhat of a profit. I really appreciate your assistance.

Joe

[kjtw]

Not a problem...figured you had considered them all but, when I set up my patrol divisions, I didn't think of a couple of things. Just wanted to make sure you thought of everything. Let me know if there is anything more that I can do to help.

[sneakybstrd]

Also consider all patrol duties that may inadvertently become an issue. Depending on your company and goals, your patrol may end up running part of a shift as a taxi for guards to get to site (I know they provide own transport, but in the real world stuff runs afoul) or acting as a temporary fill in at an unmanned site until a supervisor can arrive, etc. It's really easy to maximize profit by building in a tight schedule for your patrol, but remember there are times when a patrol will get tied up at a site and need a backup plan to finish rounds. Leave the patrol enough time to finish shift if they find a broken window or such. A real balancing act and good luck with your company.

(Don't forget liability and extra injury protection for your patrol driver and special equipment needs - I wouldn't put an alarm response guard out without a vest, etc)

[ASPS Joe Security]

Sneakybstrd,

Thanks for responding. I've run into that scenario with me having to take guards to work. I heard one company charges them a fee of $10.00 everytime he needs to take a guard to and from work even though this can be extremely burdensome if you have to repeat the process a couple of times a day. I think Liability is probably the main issue, especially in this business, any small business owner needs to take into account and needs to make sure that every possible scenario is covered by your insurance. All it takes is one little thing to go wrong in something you didn't think would ever happen and it can ruin your business with potential lawsuits. Thanks for the advise.

Sincerely,

Joe the Security (Was once thinking of going into plumbing)..just kidding!!