How To Sell Your Security Integrator

Author: Brian Karas, Published on Jul 19, 2016

Consider this a tutorial in how to sell a security integrator. If you own an integrator, want to buy one or even are thinking of starting your own one day, this is a must read.

We spoke with an M&A advisor specializing in security integrator sales, Final Image, who shared their experiences on integrator deals. The post covers:

  • How much an average security integrator is worth / can get in a sale
  • How much the sales price is driven by RMR 
  • How to know when it might be time to sell your business
  • How long it takes to get a sale completed
  • How much it costs to hire an M&A advisor and prep for sale
  • What to expect after the sale

******** **** * ******** ** *** ** **** * ******** integrator. ** *** *** ** **********, **** ** *** *** or **** *** ******** ** ******** **** *** *** ***, this ** * **** ****.

** ***** **** ** *&* ******* ************ ** ******** ********** sales,***** *****, *** ****** ***** *********** ** ********** *****. *** **** covers:

  • *** **** ** ******* ******** ********** ** ***** / *** get ** * ****
  • *** **** *** ***** ***** ** ****** ** *** 
  • *** ** **** **** ** ***** ** **** ** **** your ********
  • *** **** ** ***** ** *** * **** *********
  • *** **** ** ***** ** **** ** *&* ******* *** prep *** ****
  • **** ** ****** ***** *** ****

[***************]

Valuing ** *********** ********

***** *** **** ******* **** *** ****** *** ********* ** a ******* **********, *** * ***** ******** ***** ** *.* times ****** ***** *** ** ******* *********** ********. * **** ******* *********, and *** ****** ** ********* ******* ***** **** ** *** would ** ** *** * ******** ** *** ********* ****** of * ******** (** ******* *-** *****) **** ****** ********* profit ****** ***** **-**% ** *******.

****, ** ********** *****, ***, $** ******* ******** **** * 10% ($*,***,***) ********* ****** ***** ******* * $* ******* **** (5 ***** $*,***,*** ********* ******, ** *.* ***** $**,***,*** *******).

**** ******* **** ***** ***** ****** **********:

  • ****** ********* ******* ******* ********** (******* ** **** ****** *****)
  • ******** ******** **** ****
  • **** ****** ****

** *** ********, ***** ***** ****** *********:

  • ***** ** ********* *****/****** **** ** ***********
  • **** ** *** ********* (**** ** ******** ********* *** ********** annual *****)
  • ********* ** ******* ********** (** *** *** ** **** **** business ** * ****** ** *******)
  • ********** *** ******* (**** **** ~**% ***** *******)

RMR ****** ** *****

*********** **** ****** *** *** **** *** *+ ***** **** of *********** **** ****** ***. *** ** ********** ****** ******* *** the ********, *** ** ** ****** **** ****** **** ******** sales.

**%-**% ** ******* ** *** ** ********** * ******* **** in ***** ** ********* *** **** ******** ***** *********. ******* so *** *********** **** *** **** *% ** ******* **** RMR *** ** **** ** * ******** ************** *** *** business.

******* ** $*,***,*** ** *** ******** ** **** **** ********* and ***** **** **** **** ******* $*,***,*** ** ******* *****, integrators *** ****** ** **** ***** ******** ** *** ****** need ** *********** ** ******** *** ***** ** *******. 

*** ********** *** ********** *** *******, **** ***** *****, *** to ******* ******** ***** ** ******* ************.

When ** *** ***** **** ** ****

** **** ******** ** ******** * ******* *******, ** *** be ** ********* **** *** **** ***** *** ******* ** far ** *** *** ** *** ******* *************.  ****** ******* points ********* **** ****** * *** ******* *** *** ******* ** annual *****, ****** **** *** **** ** ****** ** ***** factors **** ************* ** ********* *******.

* ******** ** ********* *****, ** ****** ********* **** *** significant *** **** **** **** **** ** ******** (>* ****) can **** ** ********** * ******** ********* **** *** *** a ********* ********* ** ** * **** **** ** **** a ****.

*********** *** **** ***** *** ******* ****** *** ******** **** indicates * **** **** ** *** ***** ******* ** *** sale.  ** ***** ************ *** ***** ****, ****** ******* ** nationally, ** *** ** ********* **** ********* **** ****** ** capital *** ****** ************ ** **** ***** ** * ***** of ************** *********.

****** **** ** ***** ** *********** *** **** ******** ** is **** ** **** *** *******, *** ** **** **** more *** ******** ******* **** ******** ****.  ** ******** *** see ********* ** ******* **** ******** **** ***** ************* ********** to ****** * ******** ******* *******.  ****** ***** ********** ** this ****, ****** ** *** ** ********** ** ****** ****** the ******* ******* **** ** **** ** ******* ** **** afloat.

How **** ** ****

********** ** ********** **** **** *** ****** *******. ***** ***** recommended *********** **** * ***** *****, *** **** ** **** but ** *** *** ******** ** *** **** ******** ***** for ******* *********. ***** *** *** **** ******* ** *** ******* is **** ******* *** *** ****** ** ******.

************ *** ******* *** ***** * **** ** ******* ** the *********** **** ** ******* *** ******* ** *** ******. ********* like ***** ***** *** ** ***** ** **** ***** ** *********** to ** * ***-**** *** *********. **** **** ******** ********* ******** **** the ******** ***** ** *** **** **** ** ******* **** before ******* ** ********* *********.

*** ******* ** ******* *** ******* ** *** ****** *** completing * **** *** **** *-** ******. **** ****** **** to **** **** ********* *********, **** **** **** ** ******** their *** *** ********* ******* ** ** ******* ********** *** come ** **** * *********, *** **** ********** *** ****** sale.

Advising / *********** ****

** ********** ***** *** ********* **** ***** ******** ** ***** own, ********* ** ***** ********* ********** *** ***** ****** ** prospective ******.

***** *** *&* ********, **** ***** ***** **** **** **** the *******. ******** **** *****:

  • ***-**** *** ********* ******* **** ******* *** ******** *** **** up **** ******** *** *********** *** ********* ******* ***** **** ********* cost $*,***-$**,***.
  • ********* ** "**** ****", ***** ** * ***** ***** **** ** the ******* ** **** ** ********* ********* ***** *** *******. This ******* *** ***** ******* $**,*** ** ***** ** ********.
  • ******* ******, ******* **** ************, ******* *** ****, ***. ********* is ******* ** * ********** ** ******* ***** ***** (******* from *-*% **** ***** ** **** ***** *** ****** ***********).

Post-Sale ************ / ****-**** / ***********

****** *** ********** ***** ** *********** ****** ****** ** ** required ** **** ** ***** *** ****. *** ********* *** considered ** ** * ***** **** ** *** ***** ** the *******, *** **** *** **** ** **** *** ******** is "******".

** **** ***** *** ******** *****(*) **** *** ** **** in **** **** *** **** ******, ******* ******* ** ****-*** over * *-* **** **** ****.  ****** **** ****** *** owner(s) ***** *** * ****** **** *** ********* *******, **** their ****-*** ******* **** *** **** ** ************ **** **** agreed-upon ****. ****-**** *** ***** **** ** *********** ******* **** continued ****** ** ************* ** *** *******, *** ** ***** targets *** *** *** ***** ********* *** ******** **** ** adjusted **** ***********.

Comments (5)

****** *** *** ****. **** ****** ****** *** *** ** course ** ******* ** *** *** ******. ***'* *** ***** a **** ******* ******* ** *** ****** * *?

**** ***** *** *** ** *** ******* *** ****** *** a ******** ******* ***** ********** ** ****?

**** ****** ****** *** *** ** ****** ** ******* ** the *** ******. ***'* *** ***** * **** ******* ******* is *** ****** * *?

** ** *****, **** *******.

****'* * **** ***** ****** ** *******. ***** ***** ***** an ******* ****** ***** *** *********** ** **-**% **** ** average ********* ******** ** * - * ***** ******, ***** is *********** *.** *******. **** ** ********** **** **** ** have **** ** ****.

****** *** **** **** **** ******* *** **** ** ******** more ** ********** ******* (*.*., *** **** *** *** *** owner *** ***** ****** **** ******** / *******).

****, * ******* ******** ** ****** *** **** ****** ** understand **** ** ****** ***. ***, ** **** *****, ** acquirer **** ********* ********* ***** ******* *** ****** ********* ***********.

"** **** ***** *** ******** *****(*) **** *** ** **** in **** **** *** **** ******, ******* ******* ** ****-*** over * *-* **** **** ****. ****** **** ****** *** owner(s) ***** *** * ****** **** *** ********* *******, **** their ****-*** ******* **** *** **** ** ************ **** **** agreed-upon ****"

**** ****** **** * *** ****. ***'* *** ** **** a ******* **** **** $*** ** ***** *** **** **% profit **** * $**** ***** ******.******* ***** *** ** ****** at $*.**. ****** ***** **** *** **** *** * ***** and **** **** $****. ***** * *****, *** ******* ***** have **** $*.** ** *** ***** ** ** ****'* **** (that's ** *** ******* ** *** *******), ******* *** ***** with **** ** *** ** ******* ********* ***** ** ** getting *** ***** ** *******. **** ** * ******* ****? Would *** ****** ****** ** ********** ** $*.** ** ** was ***** ** ****?

* **** **** ******** ** ***** *****, *** **** *** their ***** ********* **** ********:

*** **** ******* ** **** ** *** **** ** *** sale - *** ***** ***** **** ******** ** * **** amount ** *** ******** ***** - *** $* ******* ** this **** - ***** ** *** *** ** ******** ******* return. ** ******* - *** ******** ** **** ***** ** a ******** ** ******* ** **** - *** ** ** crystalizing *** ***** ***** **** *********. **** * ***** ***** be * **** ******* - ** ***** ********* *** * shorter ******* ****** ** * ** * ***** ***** ********* the ****.

******* *** ** **** ** ** ** **** *** ******* concept ** ********* **** ** ****** ** * ********* ****** number *** ******. ** - ***** ***** ******* ** ***** 4 * = $* *******. ****** ***** * ***** = 9 *******. **** ** ********** ** * ******* ** ***** plus * * **** ******* ** $*.* *** ****.

** *** ** **** **** ** *******:

*** ** *** **** ****** ******* *** * ****** **** push *** * ****** ****** ******** ** ****** ******** (*.*., "Yes **. *****, *** ** ******* ** ***** **** ******* the *** ****** ****** **** ** '*' *** **'** ******* at '*'). ** ***********, ****'** ***** ** * **** ***** with ** *********** **** *** ******** ***** ** ******** ****** upon ****** ****** ******* *** ********.

*******, ***** **** ****** **** ******* ** *** **** ** yrs ** ******* *******, ********** **** *** ******** ******* ** to ** ********** **** *******- *** ****** ***** ********. *** often *** ****** **** ****** **** *** ********* ******* ********** impacted *** ******** (******** ********* *********, ******** ***** ******, ***..) and *** ** ** ** ***********. **** *** ** ********* for **** *******.

***** ****** ** **** ****.

Login to read this IPVM report.
Why do I need to log in?
IPVM conducts unique testing and research funded by member's payments enabling us to offer the most independent, accurate and in-depth information.

Related Reports

Burglar Alarm Sirens Guide on Mar 27, 2017
Sirens are used to alert users to an alarm condition. In this note, we examine how to choose, locate, and install alarm sirens, including Siren...
Dahua Distributor Bad Breakup on Mar 27, 2017
A Dahua distributor in Europe claims that Dahua took over his top customers, revoked his distributorship status, and left him with a large amount...
Glass Break Sensor Tutorial on Mar 21, 2017
Burglars often break glass windows to get into a house. Using glass break detectors in conjunction with alarm contacts is a good way to protect the...
Hikvision Attacks IPVM on Mar 20, 2017
Hikvision has attacked IPVM repeatedly over the last month, both in the international press and in its dealer communications. Attacks Listed On...
Dahua US Imports - Here Is Their #1 Customer By Far on Mar 17, 2017
We have been reviewing shipping records of both Dahua and Hikvision products coming in to the US. This is to help prepare the Dahua OEM and...
Alarm Panic Switches Tutorial on Mar 16, 2017
Panic switches allow silently triggering an alarm system when it is otherwise disarmed. In this tutorial we explain and contrast the 7 most common...
Brivo Opens Up, Adds Mercury Support on Mar 16, 2017
Brivo's cloud-based access control was built around the companies proprietary hardware controllers, and was often seen as a limitation by...
Top Trade Shows For Security Integrators on Mar 16, 2017
100+ North American security integrators told us what trade shows they attend and why. The most well known shows are ISC West and ASIS but there...
Environmental Sensors For Burglar Alarm Tutorials on Mar 15, 2017
Intrusion detection systems can be used to alert users to environmental issues. By connecting sensors that monitor the heat, humidity, and...
Burglar Alarm Screens Tutorial on Mar 14, 2017
Many residential alarm subscribers arm their alarms before going to bed at night. Wiring window screens allow these subscribers to leave their...

Most Recent Industry Reports

Everbridge Mass Notification Service Examined on Mar 24, 2017
Everbridge is expanding in the security space. In January 2017 Everbridge acquired PSIM platform IDV, and have also begun integrating with other...
Hikvision Removing Auto 'Phone Home' on Mar 24, 2017
Facing pressure over their cameras auto phoning home and their Chinese government ownership, Hikvision has begun quietly removing automatic...
Axis Camera Vulnerabilities From Google Researcher Analyzed on Mar 23, 2017
A Google security researcher has reported 6 vulnerabilities for Axis cameras, affecting multiple models and firmware versions. In this report, we...
OpenEye Takes Aim At Exacq on Mar 23, 2017
First Milestone targeted Exacq with a takeover offer, and now OpenEye is gunning for them with an offer to swap out Exacq for their cloud-managed...
Lock Keyways For Access Control Guide on Mar 23, 2017
Lock keyways can be the difference between a lock working or not. Understanding keyways is important for access control. Indeed, a member recently...
Broken Browser Support for Video Surveillance on Mar 22, 2017
Modern web browsers have left the security industry behind. Current Chrome, Firefox, and Microsoft Edge browsers do not support NPAPI plugins,...
ADI Favorability Results on Mar 22, 2017
150 North American integrators provided feedback on 6 distributors, and why they do (or do not do) business with ADI. ADI is clearly a big name in...
1 Million Dahua Devices Exposed To Backdoor on Mar 22, 2017
Statistics show that 1 million Dahua devices are publicly exposed and vulnerable to the Dahua backdoor. Despite this, Dahua has downplayed the...
Hikvision Hires Crisis Communication Writer on Mar 21, 2017
Hikvision has hired a crisis communication writer as the company ramps up its efforts to deal with the 'crisis' it feels it is facing. 'Crisis...
Glass Break Sensor Tutorial on Mar 21, 2017
Burglars often break glass windows to get into a house. Using glass break detectors in conjunction with alarm contacts is a good way to protect the...

The world's leading video surveillance information source, IPVM provides the best reporting, testing and training for 10,000+ members globally. Dedicated to independent and objective information, we uniquely refuse any and all advertisements, sponsorship and consulting from manufacturers.

About | FAQ | Contact