3 Pricing Strategies for Creating Your Hourly Guard Rate

3 Pricing Strategies Security Guard Companies

Developing strong pricing strategies that resonate with potential clients is critical to success for security guard companies. But no two clients are the same. Honing in on multiple strategies increases the value of your services while maximizing your profits.

Here are some strategies to choose from when creating an hourly guard rate that will help you decide how much to charge for security guard services. Using a combination of these strategies will give you the best chance at a successful price point.

Strategy #1 - Pricing Based on Cost

The easiest way to price security services is by crunching the numbers. First you’ll need to determine material, labor, and overhead costs to know how much you need to charge just to break even on each contract.

Material costs - Uniforms, equipment, gas for mobile patrols - basically anything you spend outside of wages to service a specific security contract.

Labor costs - This includes any and all wages you have to pay guards that service the contract. You can read more on trends for pay rates in the security industry here.

Overhead costs - Working in overhead costs is critical to ensuring that you walk away with a solid profit from a contract. Overhead costs include rent on your office space, administrative salaries, and any software you use.

After you establish your costs, you need to add on a reasonable profit margin that will finalize the baseline for pricing your guard services. Aim for about 3-5% of your total costs.

Here’s what the equation looks like for this pricing strategy:


Costs (material, labor, overhead, etc.) x 1.04 (4% margin) = Hourly Guard Rate


The strategy can be used safely and effectively with clients whose private security needs are going to remain relatively the same for as long as you will be contracted with them, i.e. for a storefront, a warehouse, etc.

Calculating costs is not always as straightforward as you’d like it to be. This tool will help you calculate the cost for mobile patrols.


Download our Mobile Patrol Cost Calculator FREE


Strategy #2 - Competitive Comparisons

Looking at what kind of moves your competitors are making is useful in many different situations. When deciding on your hourly guard rate, looking at what the competition is charging for their security services can be a great baseline for your own rates.

The more research you conduct, the better idea you will have of what you can charge for your own security services. And most importantly, always make sure you’re comparing similar factors when using a cost-competitive model for pricing. Here are a few factors to consider:

Level of training and experience

How many years of experience security guards have can greatly affect the rate a security company can charge on the contract they work. Having valuable certifications and training can also increase the value of a guard.

Having well-trained security supervisors is also a great way to make your services more trustworthy and demand a higher rate.

Specific Guard Services

Different types of security services have very different impacts on what you can charge a client. If your competitors are charging much more than you, look at what kind of services they are offering. You might want to see how you can add those services into your security company.

Offering armed guarding services can demand a higher security guard rate (just keep in mind you usually have to pay armed officers more money). Incorporating technology into your services is another great way to increase your rates.

But more important than any one specific service offering is diversifying your services. Being able to offer clients a wide range of security services is one of the best ways to grow.

Specific Industries

The industries security companies work in can make a major difference in the prices they can charge for security services. Knowing whether or not your competitors are working in industries that have a higher average price point can explain a lot for your guard rates.

For example, cannabis security has become a huge market - from running patrols at farms to doing door security at dispensaries - and demands a higher price point for security services because of the risk involved.

Just like with services, diversifying the industries your security business operates in can be a great way to grow.

Comparing your guard rates against competitors is very effective as long as you make sure to look at every factor that influences pricing. If you leave any factors out, you could price yourself below the reasonable market rate.

In the worst case scenario, leaving factors out means you could price yourself out of business by under or overcharging for your security services. Especially for small security guard companies, getting pricing right is critical to maximize margins that will let you reinvest in and grow your business.

Strategy #3 - Focus on Value 

This strategy is best used when you are confident that your security services are the best in the business. When you focus on customer value & success, you focus on two things.

First, focus on the amount of money you can save your client. If your client is losing $30,000 in stolen goods each month, and your services cost $10,000, you can promote the $20,000 they will be saving by contracting your security company.

Doing property walks can be a great way to show you what specific problems are occurring on a client’s properties. After the property walk you can lay out for them exactly how your services can save them that money.

Similarly, you can focus on the value of your services. If your security guards have 100 hours of training under their belts, or if your clients include top tier companies, then you can command a price based on your reputation.

Having detailed reports shows your clients the direct value your security services bring to their business. These sample reports are a great example of what kind of information you can show clients.

Download a FREE Sample Incident Report

Routine monitoring of the effectiveness of your pricing strategies is essential. This should be done monthly to ensure that your strategies are spot on target. If you notice sales lagging, or clients deserting you for a competitor, adjust your strategies to meet changing market conditions. Staying on top of it and remaining flexible is the key to long-term growth and profitability.

Another way to increase value is by keeping your best guards employed. Here at Silvertrac, we’ve developed a guide to help you with this critical issue! Download this helpful guide here today.


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Chris Anderson

Chris is the founder of Silvertrac Software and has been working in the security industry for more than 25 years. He enjoys working with clients daily to help them grow their businesses and really enjoy what they are doing. Chris currently lives and works in Seal Beach, CA.