Criticom antes up
IRVINE, Calif.--Whereas some central stations lure new dealers with free monitoring, Criticom International rolled out a program last month that offers interest-free loans based on the amount of accounts transferred to the company.
The cash advance incentive program is available to any dealer that does not monitor 100 percent of their accounts with the company, according to Tom Few, Jr., vice president of marketing and sales for Criticom. Few said the company envisions attracting businesspeople that seek financing for either professional or personal reasons. The company will not distinguish between the two when entering into this agreement.
Dealers with any amount of accounts are eligible for the program, whether their portfolio has fewer or more than 100 accounts. Although there are several different financing options available, one example is for a dealer with 100 accounts, of which 80 are not monitored by the company.
Dealers can enter into a fiveyear contract with Criticom; whereas during that time it is understood that the dealer will simultaneously experience attrition and expansion. In one scenario, Criticom will advance a 10-times multiple on those 80 accounts transferred to the central station at a $5 monthly monitoring fee.
Those accounts are then valued at $4,000 and the dealer receives an interest-free loan. Every year for five years, Criticom will waive 20 percent of that amount until the fifth year and then the entire amount is forgiven. Therefore, that dealer owes nothing on the amount Criticom provided when the contract started.
"You owe me no interest, no principal and you own the accounts," said Few. "I think it is a huge opportunity compared to what our competitors are offering."
Company executives internally discussed the workings of this project since the beginning of the year. This summer, they finalized the details of CAIP and signed up two clients by mid-August.
Other monitoring companies try to lure new customers by offer free monitoring, typically for a period of three months, although dealers get to retain all the monies they collect from their customers during this time.
The company recognized that there are many dealers without the financial means to grow their businesses. Few said that other dealer programs might provide free monitoring for several months in order to attain their business, but it is the upfront payment that will distinguish this service.
Few would not disclose how much money the company has set aside for this program. However, he sees it being an important aspect of the company's offerings.