First by-law change in 30 years allows for new LLCs, increased flexibility
KAUA'I, Hawaii--Amid the sunny climes and sandy beaches that typify a convention here, PSA Security Network members convened for a business meeting that president and chief executive officer Bill Bozeman declared, "the most important we have ever held." In a move approved by PSA's Board of Directors in September and voted on by the membership here in late October, PSA is "restructuring the organization," said Bozeman. They changed the by-laws for the first time in 30 years to allow PSA to create new independent limited liability companies that will be privately funded, but operate under the PSA umbrella, which serves as a buying cooperative for more than 200 independent security system integrators.
The first LLC, set to debut Jan. 1, after Security Systems News went to press, will be called Virtual Distribution Management, and will generally help PSA raise capital for further LLCs. The second, set to kick off in May, will be known as either Back Office Service Support or Back Office Support. Bozeman said he's already beating the bushes to heat up further LLCs, the next of which he said will be "big news."
Likely, this will be along the lines of what PSA head of business development Dave Homet was talking about when he said the goal of these LLCs is to allow PSA members to compete at the "national level. We can use an LLC to get in front of those big end users."
The by-law change will simply provide PSA with far greater flexibility, said Bozeman. Currently, PSA is organized as a Subchapter T corporation, which offers them the federal tax advantages of a cooperative, but restricts the ways in which PSA can take in revenues. The new LLCs "give us the freedom to, for instance, negotiate projects with outside companies that the cooperative structure did not allow," said Bozeman.
"I think it bodes well for PSA," said Jim Coleman, president of SecurityNet, an association of independent integrators who work collectively to take on bigger jobs. Some SecurityNet members are also PSA members. "I think [the by-law change] reflects Bill Bozeman's keen insight in what's going on in the industry," Coleman said. "There's potential for that to be good for independent integrators across the country."
For instance, the back-office support LLC is going to offer services like business planning, CAD drawing, and help with formal operations procedures that PSA can tailor to suit the needs and requests of its members.
"Giant worldwide organizations moved in after 9/11 and their power and connections changed our business forever," observed Bozemen in regard to why PSA made this important move. "If we wanted to continue to be influential, we had to change."