Simpson grows with federal pens

Monday, May 18, 2009

ALEXANDRIA, La.—As the U.S. economy shrank some six percent in the first quarter, many integrators and installers gravitated toward more stable verticals, often those that rely heavily on government funding or are somewhat immune to market variations: critical infrastructure, transportation, education, and health care, to name a few. For Simpson Security Systems, federal prison systems have been a safe harbor. The company was recently awarded a multi-million-dollar contract for integration of what are known as Division 17 systems at the new FCI-Aliceville, Ala., federal prison.

“With this economy, everybody’s concerned,” said Keith Simpson, president and CEO of Simpson Security. “Usually, when the economy goes down, crime goes up, and business booms, but new construction has slowed down enough to keep us from putting the numbers out. Detention subsidizes us. We have six million dollars of work, and since we don’t subcontract, that keeps all of our employees busy. The economy won’t affect us for at least three years.”

With about 70 employees, roughly 30 percent of the company’s revenue currently comes via corrections work, but that may grow if the construction market stays as bad as it is, Simpson said. Currently, Simpson monitors 3,000 accounts via its central station, with about half of those local residential accounts, which provide recurring revenue that also helps subsidize the business, Simpson said.

For the penitentiary work, Simpson is a sub-contractor to the general contractor, Cadell-Yates, out of Montgomery, Ala. However, Simpson was an attractive sub-contractor because of its history with the federal government, Simpson said, as there’s an “extensive qualification process,” that installers must go through. These Division 17 systems—essentially all low-voltage work, which used to be classified as “special systems”—require not only security expertise, but a track record of knowing how the federal government works.

“Your first one’s gonna be tough,” Simpson said. “Half the issue is getting qualified people, then knowing exactly what the government wants, which you don’t really know until you get in there and start talking to them about what’s different in a prison environment. Like, you can’t just open all the doors when a fire alarm goes off.

“It was tough,” he continued, “but after you do the first one, you don’t have much choice but to do a second and third, because by then you know it. Now we have it down to an art because they’re more or less all the same.”

According to the Bureau of Justice, prison populations have risen by an average of 2.4 percent each year since 2000, so there will be more opportunities in the corrections market as new facilities are built to hold those prisoners.

“Be a team player,” Simpson advised, “be an asset to that team. The Bureau does go by past qualifications. They don’t want you learning on the job.”