Small Business Surveillance Challenges Examined

Author: Marty Major, Published on Jan 26, 2011

For small businesses, deploying the right surveillance can be challenging. Usually, they do not have a lot of money available nor do they benefit from government grants. Plus, they do not have the scale to justify becoming experts in surveillance. Despite this, surveillance is often needed to handle theft, break-ins, issues with employees, etc. Equally important, the surveillance system can be a remote monitoring/management tool enabling the owner to be more productive when away from their stores or offices.

A growing trend is small businesses buying surveillance online. Search engines like Google make this incredibly easy returning top results for dozens of stores on any video surveillance related search. Those stores offer low pricing and the promise of direct help and immediate shipping. This can save thousands on up front costs - a non-trivial amount for a small business.

However, this is a controversial topic, especially among dealers who see it reducing quality and cutting into their business (see our 35+ comment discussion on the impact of online product availability).

What do you think?

To help you better understand the issues and tradeoffs involved, inside the PRO section, we've done in-depth analysis on 4 real world cases:

  • An insurance company's challenges in DIY surveillance
  • A bar deploying its own IP cameras and the challenges they faced
  • A small retail chain struggling with standardizing its systems across multiple stores
  • An alarm dealer looking to expanding into surveillance but worried about dealing with IP technology

Insurance Company Surveillance

In this case study, we examine the different surveillance choices made by a medium sized insurance company owner in a medium sized US city. With 2 existing retail locations and one more being opened soon (all in relatively high crime areas around the city) the owner finds himself facing a tough decision with no easy answers.

Five years ago a robbery at gunpoint in the parking lot of one of his two locations prompted the owner to investigate his surveillance options. He literally found 3 integrators listed in the yellow pages and asked for bids. He also checked the internet for prices and located both an electronics store and Sam’s Club locally that sold 8 camera surveillance system DIY 'kits'. Based on his own research, when the bids from his local integrators came in between $6-$7K he questioned the value of paying that much - per location - when he could get the Sam’s Club systems for around $2K each.

Focusing on price (and lacking in any real knowledge of system specs or performance), he went with the Sam’s Club DIY kits. On 2 successive Sundays when his businesses were closed he and his brother installed 6 interior cameras and the DVR at each location. Since both stores had drop ceilings, they easily installed the interior cameras and ran the supplied plug and play cables back to the owners’ office where the DVR would be kept. The owner planned on getting his electrician to install the 2 outside cameras at both locations since it required having to drill through walls.

His four employees in each store sat on stools behind a bank teller-like partitioned front counter, and lines formed in front of each of the four workers. He installed four of his six cameras behind and over the shoulder of each employee facing down the line of customers. The other 2 interior cameras were installed on opposite sides of the customer area and provided side views of the lines plus 2 angles of the front entrance.

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After using the systems for a short time, he just was not satisfied with the clarity his cameras provided. Plus, although he could see customers from 3 angles, the actual exchanging of cash, checks etc between his employees and customers was at least somewhat obscured by the employees bodies. The owner decided that changing camera placement would solve the problem, so he and his brother spent another Sunday moving the cameras around and trying to fine-tune the focus on all 6 cameras in both stores, with marginal success. To add to his pain, he could never get the remote access functioning and his electrician reported that without an alarm license he could not legally install his external surveillance cameras.

About 8 months later, the owner was picking up some marketing materials at his printer when he saw a postcard flier from a local company on the counter offering 4,8 and 16 cam surveillance systems at around 1/2 the cost of the higher yellow pages integrator bids. While

the price clearly got his attention, the flier focused on 'same day' on-site support and remote access capabilities - two of his biggest pain points after installing his own Sam’s Club box.

He called and found that this was a relatively new company; a partnership between a small surveillance equipment and support provider and a local alarm company. After discussing his problems regarding his current systems, the owner decided to replace his surveillance equipment first at one store, see how he liked it, and then do the second store. They settled on 10 cameras (which required a 16ch version of the embedded Linux DVR the provider sold) as the owner by now recognized he had initially underestimated the number of cameras he required. The install went smoothly. After some initial router issues, he was able to access his system remotely for live viewing or to check playback.

The install at store 2, however, did not end up as trouble-free. Because of the buildings design, the installers had run the RG59, 18/2 cable for one of the outside cameras through a hole they drilled in his roof. The cable was housed in flexible conduit which stretched across the flat gravel roof and up over the 3 ft high edge down to the external camera. He then added his new locations system to his DVRs CMS software just in time to go on vacation for a long holiday weekend. And the rains came.

Starting late Friday night and continuing through Sunday morning the city was hammered with torrential downpours. When the store opened on Tuesday morning, the smell of damp carpet was the first indicator that something was not right. The hole that the installer had drilled in his roof for the outside camera cable had not been sealed properly. As the rain accumulated on the flat roof, it began to drain down the outside of the cable (which joined the other camera cables above the drop ceilings) and fed a steady stream of water into the owners locked internal office. Weeks later, even after the installer had spent many days drying out and cleaning up the mess, the owners’ office still possessed a lingering, semi-offensive odor.

Current problem:

It's 3 years later now and the owner is opening a 3rd store. His first two stores are still being supported by the surveillance company he purchased his systems from, but the partnership between them and the alarm company had been dissolved shortly after the store 2 flood occurred. Without an alarm license, his support company isn't able to install surveillance in his new store. Additionally, the surveillance systems in his first two stores are at least 3 years old.

The owner wants IP for his new store, and would like to retrofit his original stores with IP as equipment fails. He sees IP cameras everywhere on-line and is still overly focused on pricing as his main value indicator. He likes the support he has now, but his providers real expertise is in older analog surveillance systems with only limited IP experience.

Choices:

  • Does the owner try to go it alone again with IP like he did with his original decision to go with the Sams Club system? (Starting with his new store and working backwards)
  • Should he ask for a recommendation from his current support provider (assuming they will be biased towards the analog systems they know [but he really doesn't want])?
  • Can he perceive the 'value' of getting a bid from an IP-centric surveillance provider? (knowing the costs will be even greater than than those he couldnt stomach from the analog integrators 4 years ago)

It really boils down to how much he's learned from all his pain and suffering.

Bar and Bowling Alley Surveillance

In this case study, we examine an end user who owns two very different local businesses and decided on different surveillance solutions for each ofthem. The owner lives in a small US town and has owned the local bowling alley for decades. In 2008 he purchased another local business – a bar/nightclub across town. He completely renovated the new building, yet failed to include surveillance in the build out planning.

In 2009 the owner decided to outfit both of his local businesses with surveillance and recognized that his needs were quite different for each location.

Let’s examine the bowling alley first:

The facility is ancient. While the owner has added some of the newer bowling alleytechnology over recent years, the basic wiring and infrastructure platform are primarilyoriginal materials. At only 7,000 sqft, this bowling alley is about one third the size of modern day centers, though still essentially a giant square box for surveillance coverage purposes. Because the owner primarily needed only simple area-coverage and wanted to avoid adding to his cabling nightmare, indoors he installed 10 wireless D-Link DCS-920 cameras that he could power using existing outlets. Unbelievably, the owner settled on an outdoor solution consisting of two more DCS-920s pointing out windows from the inside.

Now let’s take a look at his bar/nightclub surveillance solution:

This facility is basically a brand new build out using only the original building shell. Similar to his bowling alley (though ½ the size), the new place is also basically a giant box but with many additional factors needing consideration. For instance, he placed cameras at cash-handling locations (e.g. 3 bars), at 2 entrances where cover charges are paid and the back office counting areas had to have hi-resolution, good frame-rate capabilities. Finally, the floor coverage cameras required good low light function, with wide angle views.

For the club surveillance solution the owner invested in Vivotek FD7131 IP PoE dome cameras throughout, using the free Vivotek ST7501 VMS software for recording on a high-end Dell PC. The owner figured the white-light emitting illuminators he noted in literature for the FD7131 would be sufficient for the low lighting environment of his club,especially in the cash-handling areas. He was mostly wrong, though the cash areas were adequately lighted using this model camera and additional existing stationery lighting.

Notables: The owner researched everything on-line before he made his separate buying decisions. This is clearly rising trend as people look to the Internet to DIY. The choice of D-Link and Vivotek are not surprising as they are likely too of the most commonly cited/sold 'budget' surveillance products on the market.

Conclusions: Is the customer happy? He would tell you he is. While he may be happy, we believe he could have made slightly better choices – especially when management functions are factored.

Since he purchased both systems at the same time, and he thinks Vivotek is ‘high-tech’, he could easily have wired the bowling alley with the same FD7131 models he has in his nightclub or gone with a slightly costlier model of this brand like the IP7161. He could’ve then used Vivoteks ST3402 recording software (bundled free) or another VMS for both locations enabling him to manage all of his cameras on one platform. Having (and managing) two separate systems is time consuming and impractical. The time savings alone would justify the slightly increased hard cost of having compatible systems, including ease of use, training and remote access management functionality.

Regional Apparel Chain Surveillance

Here we examine the surveillance systems used by a regional apparel chain: what systems they use, what changes they have made over the years, what issues they are facing and what they need to do next. This end user faces a particularly difficult situation as they already use multiple systems, neither of which they are fully satisfied with using.

Background of End User

About a decade ago, they began operations without any surveillance system in place. Camera systems were not mandated by the parent company, prices were much higher than today, and as new business owners, they simply did not have the knowledge or experience to understand their surveillance needs at that time.

Five years ago, when opening their third store, they decided to invest in camera systems for all 3 locations to combat rising inventory shrinkage problems. After requesting bids from local integrators, they decided to buy on-line to save money. Since each of their stores averaged between 2500 and 3000 sq ft, the owners settled on 8 channel Geovision 800 (120/120) PC-based analog systems with eight 420TVL CNB 12V dome cameras each. Total equipment costs were approximately $4200 per store, and the owners decided to hang the cameras and run their own cabling using 100’ Siamese cables to save on install costs.

Within a few months, the owners came to realize that they had overpaid for their DVRs (they never used the majority of its features) and underpaid for their cameras (they could not identify facial features beyond a distance of about 30-40 feet). They changed some of the camera locations and positioning (spending many hours using trial and error), but were still disappointed with the results. When they contacted their on-line equipment provider to discuss their difficulties, the only option they were offered was an upgrade of their cameras to 480TVL. The owners then paid a $40 cost differential per camera, plus shipping both ways, for an additional $1000 investment. Over the next two years, 2 of the 3 DVRs failed requiring them to ship the units back to their provider for repairs – leaving the effected stores without any surveillance capabilities for up to 2 weeks.

About 3 years ago, they opened a new store. However, their on-line provider had gone out of business, requiring them to find a new source for equipment (and repairs). They contacted other on-line Geovision resellers (to retain system uniformity) and determined that the newer version of Geovision DVRs (v8.2) had even more features they did not require. Additionally, remote viewing required a new client incompatible with their existing DVRs.

Based on a recommendation from another local retailer, for the new store, they chose a standalone embedded Linux unit (Power Telecomm Mercury PDVR-8300) from another on-line provider. The rationale was that their current Geovision units were reaching the end of their expected life-cycles. The embedded model was less than half the cost of their Geovision units, and 540TVL CNB dome cameras were also less expensive than the currently deployed 480TVL cameras. Total equipment costs for the new store were about $3100 (down from $4200 for the previous store). They planned on replacing their original units with embedded as the Geovision DVRs inevitably failed, and did just that for one of the original locations less than 3 months later. They now had 2 Geovision PC-based DVRs, and 2 Power Telecomm embedded Linux DVRs in their 4 stores.

Current Needs of User

Today, the chain is expanding. Additionally, another of the original Geovision DVRs has died. They contact their new supplier, planning on purchasing an embedded unit to replace the failed Geovision machine, and another embedded unit (plus cameras, cabling, power supply) for the new store. However, Power Telecomm has discontinued the model they are using in 2 stores, replacing it with a more costly, feature-heavy hybrid DVR model (analog+IP) with a new CMS software platform for remote viewing.

They now have to decide:

  1. Do they go with the new version embedded hybrid model at a higher price with no backward CMS compatibility? (3rd different model)
  2. Do they search for a different third model DVR for only five locations?
  3. Do they go with an emerging VSaaS solution?
  4. Do they go with an IP solution, as availability of analog systems decline?

The biggest overall challenge is the customer’s low willingness to pay for surveillance. At about $3000 for an 8 camera system (cameras and recorder), their options are severely limited. At most, they have about $2,000 for a DVR, which blocks them from most mid to high end models.

With such budget constraints, they will have to use DVR appliances. There’s no reason to believe they will throw out their analog cameras, requiring them to buy encoders and PCs that will be far more expensive than a DVR.

What they most value is remote monitoring, specifically remote monitoring from a single interface. Accomplishing this is beset with problems. 3rd party DVR compatibility is nearly non-existent. No DVR standards exist in practice. Using PSIM will cost a fortune. Even if they use only DVRs from a single manufacturer, software changes or product discontinuations are especially common among low cost DVR providers (who tend to specialize more in hardware vs software).

Recommendations:

Due to this retailer’s past difficulties and limited budget, the recommended solution has to leverage as much of their existing infrastructure as possible. But more importantly, it has to give them a solid platform with which to plan for future expansion (additional locations, not larger square footage) - and allow for improved resolution in certain areas.

At this point, a new Geovision solution doesn’t seem wise. Their one remaining Geovision box isn’t going to last long, plus Geovision hybrid (analog/IP) capture cards alone are approximately $1100 (with full PC-based DVR at least $2500). As discussed above, the customer considers this brand too feature-rich for their needs and clearly above their pricing threshold.

The Power Telecomm hybrid solution also is not recommended, as it is not able to utilize the older CMS platform of the existing embedded analog boxes, and the risks of further product discontinuation mentioned above still remain.

The AVerDiGi EH5108 DVR/NVR or the exacqVision (8 CH) EL-S Hybrid NVR are options to consider for building a multi-store platform solution. Both are established brands with good reputations and as hybrid embedded Linux appliances, both allow for replacing SD analog cameras with higher resolution IP MP cameras for business-critical locations like front entrances, registers, and back-room cash counting areas. While the EH5108 has a more limited IP camera compatibility than the EL-S, the AVerDiGi DVR offers better storage capabilities (3x SATA HDD vs Exacq’s 1x SATA HDD), a very robust and user-friendly remote access solution (CM3000), and no IP channel licensing fees. While the exacqVision NVR is of superior quality, the enterprise class EL-S comes with an enterprise class price tag (in comparison) at around $2K vs the AverDiGi’s $1100-$1200.

One additional consideration is the fact that IP camera resolutions are limited to 1.3MP per channel on the EH5108, while the EL-S is limited only by the cameras own capabilities with no maximum resolution limits. In a larger retail environment with higher square footage, parking lot coverage, etc, this could be a strong reason to go with the exacqVision NVR. However, since this retailer is currently using 480/540TVL analog and doesn’t require large area coverage, 1.3MP should be more than sufficient for their business requirements.

Alarm Dealer Expansion to Surveillance

We examine the challenges faced by a medium sized alarm company that exapnded their core alarm business by offering video surveillance.  This can be a difficult situation as it involves new technology, new skills and potentially new suppliers. While this company has found a solution working with an online value added reseller, important tradeoffs and downsides exist.

The company has been a Honeywell alarm dealer for more than 20 years. They offer their customers an in-house monitoring solution and do not sell their accounts.  Security expertise and support are the core value propositions they seek to offer to their customers - some of whom they have serviced for more than decades.

While the company had installed surveillance systems occasionally (almost always at the request of an existing alarm customer) the owner had never focused on growing this segment of his business in the same manner he attempted to grow his core alarm operation.   Surveillance was an 'add-on'.  He wanted to change that focus by enhancing his surveillance offerings so that both segments could feed off of each other.

He has very low employee turnover, so most of his techs and service employees have the 'expert' confidence level with alarms that only comes with experience.  However, the owner came to realize that his people just did not have this same confidence level when it came to the networking aspect of surveillance systems.  If he was going to go ahead with his plan to offer (and market) surveillance products, he would first have to find a way to overcome his employees lack of applicable knowledge.

Since he was already a Honeywell alarm dealer, his natural choice was to use their surveillance products.  He got his equipment at the same supply house he already used for his alarms, but soon found that training his employees in networking skills was his biggest challenge.   His crews had little difficulty in learning the operational aspects of the surveillance equipment (including integrating alarms), but it turned out that the real hurdle was all the different network configurations used by his customers (60/40 residential, small commercial) and the fact that his equipment supplier did not offer networking support.

Faced with this dilemma, while receiving increasing requests for surveillance, he saw no easy solution.  His techs were the best at what they knew, but the needed skill sets for networking were simply outside the scope of their aptitude.  Without a certain comfort level, his techs could never have that 'confidence' he knew that his customers expected.  Further, he felt that bringing in a new employee with networking skills to complement his team might be more disruptive than positive.  The average length of employment for his techs was more than 5 years, they all worked well together, and the owner was hesitant to introduce an 'outsider' into this well-ordered machine.

To compensate, he found a small on-line surveillance equipment provider who offered networking support. His specific needs were network-related (he could already get his branded hardware fairly easily), but this supplier only offered networking support for the equipment they sold. The fact that this supplier re-sold a Korean brand he had never heard of was a cause for concern; after decades with one brand, he would now have to trust something new. He had to make sure this suppliers equipment would hold up in the field and that support was available when he and his techs needed it. The Korean brand was significantly less expensive, but even one or two service calls for defects could easily cost him more in the long run.

Eventually this on-line supplier gained trust by providing references and offering to work with his techs to train them in basic networking on the job. Using commonly available remote access tools (LogMeIn.com, TeamViewer.com, GoToAssist.com), the supplier can connect to his techs laptop at the job site and walk them through the network configuration required. With training (and repetition) the owner felt his team should be able to learn these required skills at little cost to his company. If all went well, his techs would receive the training they needed and his hardware costs would be at least 30-40% lower than using Honeywell, allowing the alarm company's margins to improve.

The alarm company is so far satisfied. However, this partnership does have risks.

Because he now has to order his surveillance equipment instead of being able to get what he needs the same day from his supply house, his customers with malfunctioning equipment will have to wait approximately three days for replacements unless he stocks at least a minimal amount of equipment himself for this purpose.  In addition, he no longer has the brand backing of his alarm equipment provider. As a long-time dealer under his current brand, this could have a negative effect on customer perception and possibly hurt his relationship with his current alarm brand.

The biggest challenge, however, is not having his entire customer support entity in-house.  By outsourcing a portion of his support, he risks being left stranded if his supplier ceases to do business.  As a preventative measure, this owner would be wise to mandate that his new supplier train his in-house techs on networking so if this does occur, his team will be better prepared to fill this void.

Lessons / Trends

This case highlights two growing trends in the industry:

  • Resellers/Distributors increasing services to improve the value of their offerings beyond box sales
  • Online support tools making it easier for support to be provided from anywhere (thereby adding value)

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