Authorized Dealer Programs

Is there one that will help your business?


In the ultra-competitive and ever-changing security industry, savvy security dealers are always looking for ways to grow business. One of the more attractive ways to bolster your company is to partner with an established, national manufacturer or monitoring service. By joining one of their authorized dealer programs, you could be gaining access to training, marketing support, and/or cash advances that take your business to a whole new level.

Of course, simply joining any dealer program isn't going to be a magic key to success; and even if you do find the perfect program, there is no guarantee that you will be accepted into it. However, you can maximize your chances of a good fit by studying the different programs available and knowing what they offer.

Monitoring Service Programs
Dealer programs offered by monitoring services companies give a variety of benefits such as leads and sales training. Mainly, however, they are about buying your monitoring contracts to supply you with additional capital to grow your business. Some programs want to buy all of your contracts, whereas others encourage you to retain ownership over at least some contracts or give options to buy them back later.

“The key function of the Monitronics Authorized Dealer Program is to purchase monitoring accounts from our nationwide network of independent security dealers,” says Robin Poulides, marketing program manager, Monitronics. “We attract and build this network by offering a wide range of support services to security dealers. Besides the initial funding provided to the dealer through their selling alarm accounts to Monitronics, we also offer revenue sharing, sales materials, management support, and some of the highest multiples in the industry.” When comparing the different monitoring dealer programs, one of the deciding factors for you could be the multiple that is offered. For instance, if your average monitoring contract makes $29.95 per month and the multiple being offered is about 30, then $29.95 x 30 is about $900. So if you had 40 contracts to sell, then $900 x 40 equals $36,000, which is about how much money you would be paid up front by a program that offers a 30 multiple.

But there is more to a good program than just the multiple, says Jim German, senior vice president of marketing, Security Associates International. “We provide competitive multiples, but that's just one component of what SAI does. What we really want to do is help a dealer's business grow.” He adds that SAI's Authorized Dealer Program has dealers of all sizes. Many of SAI's larger dealers take advantage of the company-offered IT support; whereas small or mid-sized dealers tend to place importance on the product negotiations SAI has with different manufacturers. SAI also encourages dealers to retain ownership over at least a few of their accounts.

In Criticom's Cash Advance Program, dealers retain 100% ownership of your monitoring accounts because rather than buying the contracts, Criticom finances them, explains Dan Linscott, vice president of Criticom International. While dealers do like to retain ownership of their accounts, one of the drawbacks is that they will get a lower multiple. So there is a give and take.

Another consideration is not just what a program promises, but what it actually delivers. You might have certain expectations as to what revenue streams will be delivered to your business and when. If that money is consistently being delayed due to paperwork or other kinks in the system, then it could add up to be a big problem.

ADT's Authorized Dealer Program is celebrating its tenth anniversary this year. “Dealer programs come and go but we've been here the whole time,” says Bill Barnes, vice president of dealer development for ADT. Yet ADT does not want to just rely on its reputation, he adds, so they are always improving on the sales training, the operations efficiency, and teaching dealers how to generate new leads.

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