When the going gets tough, savvy security dealers and integrators turn to vertical markets. While residential construction and renovation is receding, the commercial side of the business continues to forge ahead.
Selling service solutions to a tightly focused business group like vertical markets makes perfect sense. Many companies in the industry, particularly manufacturers, built their businesses on verticals. A vertical market could best be described as a specialty niche application or specific customer segment. Those include but are not limited to: education, healthcare, government, utilities, hospitality, resorts and gaming, public/cultural, financial, retail, corporate offices and mixed-use developments.
The key to working successfully in any of these areas is to have a good understanding of the end-user's needs and which technologies present the most cost-effective and long-term solution. Scalability and flexibility in upgrading is another plus. Most vertical markets can be profitable if you know how to provide tangible benefits customers can sink their teeth into.
Schools and campuses
The school vertical market, from K-12 to higher learning shows promise for a host of systems and services. These premises need everything from the simplest door control and electronic locks to multi-function or smart cards for access and vending. Schools and campuses also require mass notification systems, fire alarms, emergency and duress communications, safety lighting, camera surveillance and more. Older facilities are ready to upgrade while new construction needs products that are easy to use and deploy and scalable when the user wants to add points of protection or expand the system to additional buildings. That's the other profitable part of vertical markets—upgrades as well as ongoing service and maintenance, especially for fire and life safety systems.
Daniel Hogan, president of Hogan Security Group (HSG) Inc., Pennington , N.J. , knows the importance of working with vertical markets and he's built a successful integration business in the education and campus market. He starts with door control, believing that perimeter protection begins with effective locks and perimeter security. A strategic partner with Ingersoll Rand (IR) Security Technologies, he stands committed to these products and the value of security they bring to each level of customer.
Formula for success
Hogan said the single most crucial element of designing the solution for a vertical market is listening to the client and determining how to solve their problems.
“A major consideration in establishing long-term relationships and profitability across vertical markets is demonstrating return on investment,” he continued. “Making the correlation between the ‘value add' we contribute and how this interprets to long-term reliability for the solution spreads the cost over a long period of time and in essence enhances and justifies the investment for the client.”
Hogan said his company uses a “Teaming Triangle” approach, bringing together the owner, manufacturer and security integrator to jointly participate in a strategic alliance that leverages the strengths of all. “The owner has the primary role as they define their operations and the current issues,” he said. “The integrator carefully listens and applies their expertise in combining products and services to fit the specific issues and the manufacturer has product knowledge beyond published specification sheets such as lead time for delivery or similar applications that have been successfully implemented.”
HSG counts on the manufacturer, as part of the team, often bringing in his representatives from IR, such as Jeff Koziol , Regional Director for the Education Market in the Northeast. He is based in Springfield , Mass.
Koziol said one of the myths circulating in the education market is that incidents such as the recent Virginia Tech shooting have schools scrambling to find and deploy the latest technologies. While it has raised awareness, schools and campus vertical markets are more driven by The Jeanne Clery Disclosure of Campus Security Policy and Campus Crime Statistics Act or Clery Act, he said. This statute requires colleges and universities that participate in federal financial aid programs to keep and disclose information about crime on and near their respective campuses.
“Parents want to know what level of security is in place on campus and that trend is ongoing,” he continued.
Koziol said the education vertical mar ket can be divided into higher education and K-12, each with its own nuances. “In a K-12 school the security is generally a single building with limited use, shut down as many as eight to 12 hours each day,” he said. “Campus settings, on the other hand, include a lot of acreage with students living 24/7 at the premises. Some 80 percent of colleges have access control in place and security in internal spaces, including server, computer and data rooms. Most are using Internet protocol (IP) systems to leverage the campus network. That necessitates strategic selling by the systems integrator. It's not just one person the integrator is working with. It's a team that might include the director of housing, the vice president of finance, the information technology (IT) person and more.”
At Raritan Valley Community College in Branchburg , N.J. , HSG recently installed an integrated closed-circuit television (CCTV) surveillance and card access system in a new building under construction. Within days of its installation, the system captured an incident on camera.
“Shortly after completion of the CCTV system the College had an incident,” said Hogan. “After review of the video we were able to identify the intruder entering the building and disseminate that information to local authorities, rapidly resolving the situation to everyone's satisfaction,” he said.
Real estate developments
With vertical markets, variety helps set the stage for profitability. REMI Companies of Hoboken , N.J. , were planning the development of an upscale residential site for high-end luxury living in a newly refurbished neighborhood of New Jersey just minutes from New York City and wanted to make the clientele feel comfortable in their environment in an effective but non-obtrusive way. During the construction of the development called Velocity, they also wanted to show investors and project managers the progress on the job site.
REMI and Vision Voice and Data, systems integrators of Cranston , R.I. , selected Danetech Inc. of Rhode Island to install Milestone XProtect Enterprise IP video software to manage more than 60 cameras from Axis, Toshiba, and Videology . A Zeus server is dedicated to handle the Milestone recordings. The server room also contains the central equipment for the Keyscan access control, Viking intercom and networked phone system. The security solution is complemented by ADT burglar alarms, 24-hour concierges with command center views of surveillance and night guards from Planned Security Services of New Jersey.
“We took surveillance to another level,” said David Lepak , Director of Technology for REMI. “The banks financing the development project want instant gratification for their investments – they like to see the buildings they are paying for. But it's like pulling teeth to get these busy people to come out to a job site. So we provided them a portal with access to view the camera images to watch the machines, cranes and people working. It's good for us – we got two things out of it: we'd survey and control our job site and also gave access to our investors to keep them happy.”
The possibilities for profitable vertical markets seem infinite. ROK Systems found a profitable niche in food production facilities with integrated IP video and access control and time and attendance systems, according to Brad Playford , president of the Belmont, Mich.-based company.
“With the increased awareness of bioterrorism, facilities such as these are being asked to control their operations more fully,” Playford said. “Their customers want to be online in real time so they can see their job being run in the production facility and meet food regulation compliance. These customers include the likes of Bird's Eye and Campbell 's who come into the plant to view their product being processed for distribution.”
A vertical market offers the security integrator the flexibility to offer a host of systems and services and best of all to boost profitability while plying their trade.