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Seven-minute abs...

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Friday, March 27, 2009
Nice presentation by Mike Jagger on marketing for the alarm industry. He's big on quality over quantity, providing exceptional service rather than competing on price (he calls it the race to the bottom). He knows his way around Power Point (or dare I hope, Keynote), too. The light's a little off, but this is worth watching if you're an independent installer: Wanna chat with Mike and some other good thinkers in the industry? Finish your Thursday night at ISC at the Treasure Island casino bar. It's a casual gathering, but you need to have your nightcap somewhere, right? 10 p.m., Thursday night, see you there. It's nice and open and not as loud as some of the night-clubby type places.

SafeGuard Security VP wins new car from ADI

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Thursday, March 26, 2009
John Jenning's parking lot at SafeGuard Security in Scottsdale is looking sportier with the recent addition of a fancy new Ford Shelby GT500 Mustang. Ben L. Wilson, vice president of operations at SafeGuard, won the new wheels in ADI’s 2008 customer appreciation sweepstakes, ADI announced today. Click this link to see a picture of Ben, the new car, and John Sullivan of ADI. Wilson was picked from 9,000 entries in this year's sweepstakes. ADI has held this contest, with a high-performance car as a grand prize "to demonstrate its gratitude and appreciation to customers." “At ADI, our customers are extremely important to us and in today’s environment, it is even more meaningful to continue to demonstrate our appreciation,” said John Sullivan, vice president of sales at ADI, in a prepared statement. “We are really excited for Ben, and are pleased to award him a new high performance sports car.” Wilson has been in the security industry for more than 26 years, and a customer of ADI since 1985. Wilson and his team regularly visit the local ADI branch in South Phoenix, Ariz. You can see this year's ADI grand prize, a Chevy Corvette Coupe, next week at ISC West and at several other industry trade shows this year. Complete an entry forms at a local ADI Expo, or by visiting ADI’s booth at ISC West, ISC East, EHX, CEDIA EXPO and InfoComm.

NBFAA extends First Line of Defense Award entry deadline

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Thursday, March 26, 2009
I got an alert through Linkedin this morning through my NBFAA group membership from co-member Jason Smith, NBFAA communications specialist. It looks like the NBFAA has extended the deadline for entry in their First Line of Defense Awards competition. The old deadline was March 14, 2009. Interested entrants now have till April 10 to get their story considered. I wrote about the call for entries from the NBFAA back in our February issue. The original brief is below.
IRVING, Texas—The National Burglar & Fire Alarm Association wants to know if your company's electronic security system helped save a life, avert property damage, or prevent a crime. The NBFAA is soliciting entries for its 2009 First Line of Defense Award, which recognizes a security company’s actions in a specific incident in which the right response saved a life, prevented property damage or loss, or otherwise prevented a crime. If your story is selected, you and your customer will win a free trip to the awards ceremony. Plus, your story will be featured in NBFAA publications and your company will receive a local and national publicity campaign. “The First Line of Defense awards a company that represents what our security industry is all about—protecting people and property,” said Brink’s Home Security spokesman Dave Simon, who is NBFAA public relations committee chairman, in an email interview. “The winner each year is selected based on a number of factors, often for having saved the life of a homeowner.” Interested security companies can write their story and send it to the NBFAA for a chance to win the 2009 award to be given at the 2009 Electronic Security Expo (ESX) in Baltimore, Md. Applicants must be current NBFAA members in good standing, or apply for membership at the time of the award submission to qualify for the award. The incident must have occurred between October 1, 2007 and December 31, 2008. All entries must be postmarked by March 14, 2009. “In a typical year, we tend to get five to ten entries,” Simon said. “We'd love to see that number increase.” A copy of the complete rules, judging criteria, and additional required forms can be downloaded at the NBFAA’s website www.alarm.org. Questions on the contest rules can be directed to Laurie Knox at (888) 447-1689 or by e-mail at lauriek@alarm.org.

Who's buying Cornwall?

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Thursday, March 26, 2009
I listened to the conference call today discussing the Tri-S earnings report, if only because its Cornwall subsidiary does some security installation, even though its Paragon guarding company generates most of its revenue. Surprise for me, it was announced the company would be selling off its Cornwall Group, which it purchased back in 2005 for around $15 million. So, who's the buyer? They wouldn't say yet, but there's apparently a letter of intent that's been signed and they expect to announce terms at the end of next week. The company's kind of desperate to get rid of Cornwall, since it needs to pay down some debt and it's in the process of closing on another financing facility with Wells Fargo. Though the company grew some 50 percent last year, it's losing money to the tune of $14 million in 2008 (though $6 million of that is a goodwill impairment). But growth is well liked, apparently. One investor was so enthusiastic about the potential of the company that he wondered if Tri-S had takeover protections in place. It does not.

Raefield has work to do at Mace

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Thursday, March 26, 2009
Mace released their 2008 financials today. See for yourself. There's a lot there to wade through, so I'll give you some highlights (or lowlights, depends on your point of view): Security revenue has actually dropped each of the last three years. 20,788,000 - 2008 - 27.5 percent gross margin 22,278,000 - 2007 - 27.1 percent 23,366,000 - 2006 - 25 percent 24,909,000 - 2005 - 29 percent But you can see that they're headed back in the right direction on cost of sales and gross margin. Still, the overall numbers don't look good for the company yet. They took a net loss of more than $10 million on about $51 million in sales (though there's a $5 million goodwill charge in there that makes that look worse than it really is). While the company has lost about $6 million a year since 2004, and you could say this is right in line with that, there still aren't signs of Mace moving toward profitability, even with a new digital marketing arm that's bringing in more than $17 million. There are good signs, though. First, Mace has almost no debt, just over $6 million, which isn't much at all, especially in this economy. Second, the company still has more than $16 million in working capital, so there's cash on hand for operations and even possible small acquisitions, like that central station they've been talking about. Here's what they've got to say about the make-up of the security segment:
Our Security Segment designs, manufactures, markets and sells a wide range of products. The Company’s primary focus in the Security Segment is the sourcing and selection of electronic surveillance products and components that it produces and sells, primarily to installing dealers, system integrators, retailers and end users. Other products in our Security Segment include, but are not limited to, less-than-lethal Mace defense sprays, personal alarms, high-end digital and machine vision cameras and imaging components, as well as video conferencing equipment and security monitors. The main marketing channels for our products are industry shows and publications, outside sales representatives, catalogs, internet and sales through telephone orders. Revenues generated for the year ended December 31, 2008 for the Security Segment were comprised of approximately 35% from our professional electronic surveillance operation in Florida, 43% from our consumer direct electronic surveillance and machine vision camera and video conferencing equipment operation in Texas, and 22% from our personal defense and law enforcement aerosol operation in Vermont.
So, of that $20,788,000, roughly $7,275,800 is coming from the professional electronic security market and their dealer program. That's the number to watch going forward. In 2007 it was $7.8 million. In 2006 it was $9.1 million. Here's the explanation of the movement downward:
The decrease in revenues within the Security Segment in 2008 was due to several factors. The majority of the decrease in sales was from decreases in sales of our consumer direct electronic surveillance division, our professional electronic surveillance operation and our machine vision camera and video conferencing operation. Our Vermont personal defense operations sales remain consistent between years. The decrease in sales of our consumer direct electronic surveillance, machine vision camera and video conference equipment operations, and our professional electronic surveillance operation was due to several factors, including the impact on sales of increased competition and the impact of management’s completion of its consolidation of the Security Segment’s electronic surveillance equipment operations from Ft. Lauderdale, Florida to the Farmers Branch, Texas warehouse. The consumer direct electronic surveillance and professional electronic surveillance division had a decrease in sales due to a delay in introducing new product lines during 2008. In the latter part of 2008 sales also decreased due to a reduction in spending by certain of our customers impacted by the deteriorating economy.
I think 2009 will be a real bellwether for Mace. They've got the management in place, they've got a plan, and people are going to expect returns in 2009. They've yet to really be able to leverage their brand. We'll see if they can do that this year.

See you at Booth 5047

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Thursday, March 26, 2009
Sam and I were arguing over who would get to blog about this press release from The Spy Place. I won. What's The Spy Place? It's a security business that's going to start a franchise. Franchisees will do GPS monitoring, document destruction, (and, I'm unclear, but have some kind of security gift shop?) Anyway, the whole shebang will be introduced at ISC West. First: I love the name. Spies are cool. Harriet the Spy was my favorite book in elementary school. I took my kids to the Spy Museum when it opened in DC. There were a few years when I actually wanted to be a spy ... Nice name. And I like franchises. We've reported on a lot of franchises lately, so I'm interested in this trend. I'm really interested in this press release though. The release gives some history of The Spy Place, which has "humble beginnings" in Indiana. There's talk of the "energy" created by this name and how the opportunity represents a "paradigm shift." The final quote is a paradigm shift in setting expectations. What, you think The Spy Place might stink? Well think again. Spokesperson Smock says:
”We packaged it. We packaged it like it has never been packaged before. We wrapped it up, along with our most unique business model and plan, in the most easily recognizable, electrically charged, energy generating way. The Spy Place is sure to become the most recognized name in the security industry, period,” explains Ms. Smock.
You can't keep me away from Booth 5047. See you there, and here's the rest of the release.
The Spy Place Franchising, LLC Offering a Full-Service, Fully-Integrated Security System Debuts at ISC West—Booth # 5047 Las Vegas, NV (April 1, 2009) From its humble beginnings as a security shop in Fort Wayne, Indiana, The Spy Place has developed into a full-service, fully-integrated security system franchise that is being introduced at the International Security Conference (ISC) West, at the Sands Convention Center, April 1—3, according to Tammy Smock, The Spy Place spokesperson. “The Spy Place is geared to become a leading security and surveillance franchise company. The energy created by this name and system are unlike anything in the industry. We are committed to helping entrepreneurs take full advantage of the energy and industry diversity created by The Spy Place,” notes Ms. Smock. “We have all seen successful businesses that service only one aspect of the security or surveillance industry such as GPS vehicle tracking software, mobile document destruction, limited access or lighting. That corporate model can only go so far and is self-limiting. We believe that franchising a system that allows for one business to serve every aspect of the industry is a paradigm shift that will allow this industry to grow and develop,” says to Ms. Smock. “We pride ourselves on being an innovative franchisor utilizing the highest quality training and systems for our franchisees. The Spy Place franchisees will run our exciting James Bond-type retail store complete with the most innovative and exciting spy gadgets. Our unique system and trademarked name, The Spy Place, allow for a panoply of surveillance services far beyond the generalized business model of installation and monitoring, limited access and lighting control. There is no limit as to what our franchisees can do in this industry. In addition to the general business model, our franchisees can also service GPS vehicle tracking, document destruction, vehicle recovery, personal protection, private investigation, computer forensics, and any other niche from within the industry. In essence, the franchisees will be running several different businesses under one name,” adds Ms. Smock. In order to train franchisees, the company will provide a fully-integrated sales training program including “Perception Training” at The Spy Place University in its world headquarters located in Fort Wayne, Indiana. During the two-week course, franchisees will be provided insight into the company’s operating system, along with its business knowledge and leadership. Because of the combined buying power of a franchise system, The Spy Place has arranged for franchise owners to receive preferred pricing from its approved surveillance industry suppliers. What did The Spy Place do for the surveillance and security Industry? ”We packaged it. We packaged it like it has never been packaged before. We wrapped it up, along with our most unique business model and plan, in the most easily recognizable, electrically charged, energy generating way. The Spy Place is sure to become the most recognized name in the security industry, period,” explains Ms. Smock. For additional information on this extraordinary franchise opportunity, please go to www.TheSpyPlace.com .

EMERgency24 launches new site with lead generator

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Wednesday, March 25, 2009
I just got a press release from EMERgency24. They've got a brand new site up and running. The new site features all kinds of educational features and a lead generation function, which should be helpful for dealers. The site actual looks pretty cool, and could serve as a nexus for the many different aspects of the world of security, from end-users to dealers, to AHJs. It's good to see more and more education going on out there. I've blogged about it before a few times.

Feel like poking around the NetVersant case?

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Wednesday, March 25, 2009
Have at it. It's currently making my head hurt, but I think I've pulled out some interesting information. Look for a story on our newswire tomorrow.

Cantronic buys in China

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Wednesday, March 25, 2009
Not a huge deal, but I think it's interesting that Canadian infrared video maker Cantronic has bought into Chinese video management firm AVINFO. IMS is talking about China being a $3 billion surveillance market. I guess Cantronic's trying to get in while the getting's good:
"The combination of AVINFO's network management software and Cantronic's camera products will allow us to offer a complete solution in China's rapidly expanding security and surveillance market," stated James Zahn, president and CEO of Cantronic. "AVINFO has established its software as one of the leading management platforms for monitoring and surveillance, with small and large installations in some 60 Chinese cities. As these cities expand their networks they are more likely to choose a proven software solution with a user interface that their staff has been trained on. With AVINFO, Cantronic has improved its product offering, acquired a growing customer base in China and added talented technical and sales management. Cantronic is now well positioned to achieve its China growth strategy."

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