Security industry feels Katrina's wrath

Saturday, October 1, 2005

YARMOUTH, Maine--Hurricane Katrina's impact on the Gulf Coast reached well into the security industry, shutting down numerous installation companies in the area and complicating the efforts of several Gulf Coast distributors to ship products around the country.
In Louisiana alone, the National Burglar & Fire Alarm Association estimates that Hurricane Katrina affected 170 licensed security installation companies. That same information is more difficult to track in Mississippi, a state that does not require licensing for people installing security systems.
Jack Mallon, managing director at Mallon Capital, said it is too early to place a dollar amount on Hurricane Katrina's impact on security industry, but said it is significant.
Some companies, such as Protection One, expect revenues may be down by $500,000 this year--which represents less than one percent of total revenues--due to losing customers in the Gulf Coast area. Interface Security, which serves 10,000 customers in just the affected region, expects to lose 20 percent of those customers.
"We're bracing ourselves for ultimately having a loss of up to 2,000 subscribers," said Mike Shaw, chief executive officer of Interface Security. "But long term, there's going to be a tremendous amount of reconstruction and we intend to be in full force to help keep people safe."
Security camera importer CCTV Imports is fully operational and able to ship product out to customers, but business is off by 50 percent.
"Miraculously no inventory was damaged during the storm," said Kevin Lazaroe, owner of CCTV Imports, who believes many of his 35,000 customers went to other suppliers.
Lazaroe is now trying to get new inventory into his Covington, La., business from Houston, where it was rerouted because of the storm. But the challenge for Lazaroe is finding a trucking company available to move his inventory since FEMA is using many trucks for relief efforts and other trucking companies are price gouging.
It's unclear exactly how many security companies are closed for business. Security Systems News attempted to contact numerous companies in the New Orleans and Gulfport, Miss., area by telephone only to find the phone lines busy or not operational.
Home Automation Inc., a manufacturer of home automation products based in New Orleans, posted a message on its website saying it would move operations to the North Shore of Lake Pontchartrain while New Orleans recovers. William B. Allen Supply Co., a low-voltage distributor in the city, could not be reached by telephone.
John Stachura, president of AAA Gulf Coast Security in Gulfport, Miss., had his answering service reroute his company's telephone calls to his cell phone. He lost 100 of his 500 customers. Many of those customers lived in the antebellum homes on the Gulf Coast that were destroyed by the hurricane.
While a downed tree destroyed AAA Gulf Coast Security's office and the company lost $15,000 in inventory, the installer is up and running. Three of Stachura's four employees returned to work and the company is averaging 15 to 20 phone calls a day from people looking to either install a new security system or repair a system damaged in the storm.
"We've been working until 8 or 10 o'clock at night to protect what little (possessions) people have left," said Stachura. "We're going to make it. We'll come back."


Martha Entwistle, associate editor, and Erin Zwirn, assistant editor, also contributed to this story.