Editorial: Succeeding During the Recession

This article originally appeared in the August 2012 issue of SD&I magazine

You hear a lot of stories about companies flopping, bankruptcies, double-digit revenue dips. But small business in many instances seems to be thriving.

President Obama's approval rating dropped to 35 percent among business owners in the second quarter of 2012, according to a Gallup daily tracking poll released July 26. "The data preceded Obama's much-discussed July 13 comments that small-business owners have had help from others to achieve success," Gallup noted. "Thus it is not yet clear whether those comments have led to further deterioration in Obama's standing among small-business owners."

And while the ongoing economic situation hasn’t been pretty or even perky, with unemployment stuck at about 8.2 percent in June, according to the U.S. Department of Labor Statistics, the security industry seems to be a bright spot in an otherwise perpetually cloudy picture and that point was confirmed at the recent ESX show in Nashville when I queried several security company owners about how they felt the economic situation sits at their firms.

Some 12.7 million unemployed

Security firms are hiring, according to the systems integration company owners I interviewed, but still are cautious about where they add jobs and the overall economic scenario. And much of it might depend on the area of the country is which they do business. For example, Roger Savage, vice president of AlertAlarm in Honolulu, Hawaii related that the unemployment rate is about six percent and things are good at the islands-based integration company. “Business is good,” said Savage. “We are hiring and focusing on IP and interactive services. We are adding technicians and sales personnel,” he said.

Chet Donati, owner and president of DMC Security in Midlothian, Ill., who runs a central station, said he has seen a slight pickup in sales, but added that he’s not quite as confident about the resiliency of the industry that seems to be purported. “One thing I realize that we are not as ‘bullet proof’ as a security company as we thought,” Donati said. “About 80 percent of my customers are commercial and if they go out of business, that’s business I lose,” he said. Donati also commented that he does worry about “the big guys coming into this industry. This time, they just might get it right.” But they just hired a service/sales manager and also bought a small local company that went out of business.

George Gunning, CEO of USA Central Station in Monrovia, Calif., and a past president of the Electronic Security Association recently hired a service manager, but doesn’t think the unemployment rate will ever move much lower than seven or eight percent. “We’re all getting more work out of the employees we have,” he said. “And we are also concerned about what’s happening with the medical insurance scenario. We pay for 100 percent of the healthcare for our employees.” He added that there seems to people who want to get out of the business and his family owned and operated company is looking to expand by acquisition.

On the other side of the country, in Marlboro, N.J., Complete Security Systems Inc. recently hired six new employees in various positions, said Chris Mosley, president. “Business does seem to be a bit better, but it’s completely different now. “Everything’s negotiable and our margins have been lowered and every contract is going out to bid,” he said. “With this economy, everybody’s shopping around.”

The security industry is doing something right. It may all be part of the entrepreneurial spirit I keep talking about. Or, it may just be about you and your business acumen. Whatever it is—keep it up.