Smith introduces new dealer program
PASEDENA, Calif.--After two years of planning, industry veteran Tony Smith will announce a "no-hold-back, no-guarantee" dealer account-funding program next week at the ISC West trade show.
Called Security First AlarmGroup, the dealer program has been in the works for a while. "It's taken us more than a couple years to put this together because [the financing is not] traditional. We wanted to be able to tell the dealer that we're committed to him for at least five years and that we have the funding in place, and we can do that," Smith said.
Smith said his program, compared to those offered by large security companies, will be more lucrative for dealers.
No stranger to dealer programs, Smith has been in the industry for 20 years and is the owner of Security Finance Associates. He's designed dealer programs for other companies as well as owned and sold three alarm companies in the Pasadena area. In the days before Protection One switched its business model, Smith was Protection One's largest master dealer.
With the new company, Smith will expand from the business services side of the industry to account acquisitions.
Smith also touted the non-exclusivity tenet of the program. "Dealers can contract with ADT or Monitronics and still have a contract with us," he said.
Smith said the dealer can "get up to 30 percent of gross monthly revenue from the customer contract," meaning that if the customer's monthly payment is $30, the dealer can get as much as $9 per month on that account. "The key word here is 'gross,'" he said. "No one gives that kind of revenue [to dealers] and if they did they would take a percentage of the cost out of that revenue," Smith said. "We're thinking this will be a good opportunity right now and we got a five-year forward commitment of funding, so we're in it for the long term."
Smith is not releasing who is providing the backing other than to say it's a "Midwest-based finance company that's supported by a consortium of banks."
Smith will officially announce the new business and offer further details at a press conference at ISC West in the Marco Polo Room 701, at 11:30, on Wednesday, April 5.
For more on this story, see the May issue of Security Systems News, which will include insight from Michael Barnes, a partner in Barnes Associates, an investment banking and consulting firm that specializes in the security alarm industry..