There’s no substitute for experience in the security industry. When starting out, a lot of entrepreneurs end up making small mistakes that have a major impact on their long term growth and success — or, in many cases, mistakes that put them out of business. With experience comes the knowledge of how to avoid making those costly errors.
But where do you get that experience?
Chris Anderson has over 25 years of experience working in the security industry. He started out as a deputy with the LA County Sheriff’s Department before starting his own private security company in 1998. He soon became the president and CEO of several companies in Colorado, Arizona, and California. Most recently, he cofounded Silvertrac Software. Silvertrac provides guard management software that helps hundreds of private security companies across the country. In short, he knows the challenges faced by security companies and the solutions to them.
The advice in this guide is drawn directly from Chris’s experience in the private security industry. Whether you’re looking to break in or wondering why you can’t seem to make your own company profitable, these tips are specifically designed to help you get started and make it successfully in this competitive industry.
Hiring security guards might be the most important aspect of starting a private security company and making it successful. After all, the people you hire will be the face of your company. Effective interviewing is how you always make sure you hire the best person for the job.
Before you conduct a single interview, the security guard recruitment process will let you narrow down your candidates to the most qualified applicants. Recruitment starts with the job description.
Job descriptions should first and foremost include the requirements of a security guard in your company. This way every applicant will know what is expected of them if they get the job. This might include things like already having a guard card or owning some standard security guard equipment.
It’s also a good idea to include salaries in the job description. This ensures that you don’t waste you or an applicant’s time if the pay you’re offering is just too low for them. If you need to know what the average security guard salary is, Glassdoor is a great resource for salary ranges in multiple industries.
The interview process is where you learn what makes your potential hires tick. It’s also where you set early expectations about security guard job requirements. Take the time to ask the right questions and determine if an applicant is a good fit for the job & your company culture. Let your interviewee know what the job requires, the shifts you’ll need covered, and what exactly their role on the security team will be.
If this is an area of focus for you right now, check out the webinar we did with Jason Berkowitz - Senior Director of Customer Success at Jobvite - on security recruitment.
Always, always talk about post assignments during the interview. That way, you can be sure that the right person gets assigned to the right post. A lot of interviewees will say they’re open to any assignment or any shift to get the job, only to discover they don’t actually want to work nights or weekends once they’re assigned. Having an honest and open conversation early on can prevent a lot of future headaches.
In addition, work with your candidate to ensure they’re okay with the specifics of a post assignment before you hire them. It helps to frame this as a question:
With that knowledge in mind, only assign new officers to roles where they’re relatively comfortable. If they aren’t comfortable with an assignment, don’t hire them to cover that position — no matter their qualifications. Don’t put a guard somewhere where they won’t feel safe. If an employee doesn’t like post, it won’t work out. They’ll end up calling in sick more often and may even leave the property. Avoid those problems by asking targeted security guard interview questions.
Also, don’t hire part-time workers that have other full-time jobs. Full stop. They’ll never get enough sleep, they’ll call in sick, and you’ll always be second place to their full-time commitment. There are some circumstances where it may seem okay — someone looking to work a shift on Saturday after their office job, for example. Even then, you run the risk of no-shows and call outs.
In the event that you end up hiring a bad-fit employee, be quick to remedy the issue. It's always better to hire slow and fire fast.
You can only learn so much from an interview. A background check is essential for the security guard hiring process. Your clients trust that you will provide them with reliable, trustworthy officers. If you aren’t doing due diligence on background checks, you’re reneging on that agreement.
Make sure the background check you receive is up to date. A lot can happen in a year or even six months. You want the full picture before you hire someone. Any violations that come up in your research should be a red flag, no matter if they seem unrelated to the job assignment. If your background check turns up something on their driving history, such as a DUI, that can result in a huge cost increase on your insurance.
If you operate a security guard company in the state of California, you’ll also want to make sure their guard card is up to date. If not, don’t hire someone on the promise that they will get everything lined up on their own.
Of course, people with a really bad record will try to find ways around a background check. After you perform due diligence, ask new hires for ID documents and make copies of everything as part of the onboarding process. If you discover that they falsified documentation to get around the background check, you’ll need to have a record in order to protect your company.
A background check should include a look into your applicant’s driving history. While a bad driving history may not seem related to many job tasks, bad driving records and major accidents can massively hike up your auto insurance costs. For insurance companies, a driver’s history doesn’t get put on hold when they show up at work. Likewise, putting an employee who is under the age of 25 on your insurance can increase your rates.
Foreign driver’s licenses can complicate your insurance rates, too. A lot of people may be legally able to live, work, and drive in the U.S., but you won’t want to put them on mobile patrol. Why? Because drivers who are licensed to drive in another country may not be covered by your insurance.
Remember, an accident could ruin more than a car — your reputation is at stake.
You can’t talk about running a successful security company without getting into finances. A lot of people start security guard companies because they have experience in the field, only to discover they don’t know how to run finances for a small business. In addition, the tight margins that come with the security industry will push a lot of company owners to fudge on the rules, moving money around to cover payroll or expenses. That’s when you can find yourself in hot water. Here’s what you have to keep in mind when asking how much it costs to start and run a security company:
This should be a no brainer. If you don’t have enough capital to cover expenses, you don’t have enough to start a business. That doesn’t stop a lot of people from trying, though.
You need more money than you might think just looking at your expenses. There are a lot of costs that come with starting company. Keeping it up and running during slow periods can also be costly. To start out, you’re going to need to pay for proper licenses and security insurance. You should also have enough to cover payroll for 3-4 months when you start out.
Your financial stability can’t solely rely on clients to pay on time. Starting out with that expectation is setting yourself up for tough times. Eventually, one of your clients is going to get behind on billing, at which point you still need enough cash on hand to pay your officers.
In the security industry, pressure to pay officers under the table is intense. Many unethical companies pay under the table to cut costs so they can undercut above board competitors on rates. Competition can push security guard companies to find ways around good labor and payroll practices.
If there’s one thing that can be said after decades of experience in the industry, it’s that playing games with finances is never worth the risk. Labor laws and penalties related to payroll are designed to punish bad actors in ways that hurt…ways that often lead to bankruptcy. Don’t risk it.
Beyond keeping payroll above board, it’s important to follow best practices for finance. Don’t withhold payroll taxes on your own and think you’ll pay it back later — go through a payroll company that takes everything up front and handles the rest. Companies that try to run withholding on their own often end up deep in the hole. Let someone else take care of this one.
Don’t cut your employees a personal loan with the promise you can “just take it out of payroll” later on. If you want to give your employees a loan, there are proper channels to do it — ones that won’t put your company at risk in the process. Tying a personal loan to payroll can get you in a world of trouble.
Security guys tend to think they are pretty frugal types. However, that couldn’t be further from the truth. Staying frugal means knowing what tools benefit your security company — and which ones just benefit your ego.
Firstly, you don’t need fancy uniforms. A lot of companies just starting out will outfit their security team with a desire to look the part. That’s a foolish way to think about uniforms. Finding a budget uniform for your security officers that looks professional and is designed to last can save you hundreds of dollars over more costly solutions.
You also don’t need fancy security guard equipment like bodycams. Chances are you’ll never use them. You’re far better off investing in a security management system that will make sure officers are where they need to be, when they need to be there to prevent incidents from occurring.
Likewise, you don’t need fancy patrol cars. Maximizing your mobile patrol profitability comes down to minimizing your cost-per mile. A used Honda Civic will last longer and cost less than a new Camaro with a custom wrap.
Now, a lot of guys say they got the Camaro for advertising purposes. That doesn’t work, of course — clients sign contracts based on a security company's track record, not their advertising. If you want a Camaro, buy one for yourself once you have a successful business. Cars don’t win contracts.
Plus, you’re going to put a lot of mileage on a patrol car. Buying a car is going to burn through your capital, especially one that that costs a lot in upkeep like a pickup truck or sports car. Go through a rental car agency that will handle maintenance on a monthly basis, then just turn and burn those patrol cars. Swap out the light bars and decals when you upgrade to a new vehicle. For more help, here’s a great mobile patrol cost calculator.
Hiring and finances are essential for starting a security guard company. Once you launch, it’s time for a crash course in the world of contract law and salesmanship. There’s a lot about sales and contracts that first-time security company owners simply haven’t encountered. Here’s what you need to know so you don’t get screwed:
If a client has a poor track record for paying their bills on time — or if they were fired by their previous guard company — you simply don’t need their business.
Now, a lot of new contract security company owners think “I just started, I need all the business I can get. What do you mean?” But think of it this way — somewhere down the road, that client could put you in a tough spot by not paying for 30, 60, even 90 days.
That whole time, you’re waiting for money that you need for payroll, for expenses, and for growing your business to take on new (and better) clients. You’re also putting wear and tear on vehicles and uniforms in the process. After some months of making excuses, putting off your invoices, or making partial payments, they come to you saying “hey, can we cut a deal?” That’s when you realize you got played.
These kind of clients will bankrupt your company. You won’t get their checks and you won’t be able to make payroll. A client like this can trigger a cycle that is nearly impossible to escape. So, avoid these bad-fit customers at all costs. If you do have trouble collecting past due invoices from your active clients, here are a few strategies to effectively collect on past due accounts.
When a client isn’t keeping up their end of the bargain, cut them loose.
Now, no company owner should want to fire a client. It should be avoided if possible. But don’t be afraid to look out for your best interests. Like the finance section talked about, contract security companies deal with late payments all the time, but that doesn’t mean you should be okay with that.
To prevent future conflict, try to prevent miscommunication by establishing an agreement at the beginning of your engagement. This isn’t a contract, mind you — it’s just a way to set standards and expectations ahead of time. Arguably, it’s also a great way to seed future referrals in exchange for the good work you do, too.
You can reference the agreement if a client started out looking good, but has since lagged on payment. If possible, you can also work out penalties for late payments within the agreement. If a client refuses to sign the agreement, and they end up getting behind, that’s when it’s time to say “you’re gone.”
Protect your company by having a diverse portfolio of accounts. One client can make or break a company when company leadership isn’t working hard to cover all bases. If you depend on one large account to make payroll, you’re always at risk of going out of business. If that one client misses an invoice or doesn’t cut a check in time, you’ll start to feel the heat.
The best contract security companies bid on new contracts in every industry possible. This will mean implementing different sales strategies that help you win the contract bids. Appealing directly to property managers using security technology can be a great way to win more contracts.
That contract 50 miles away from home base might look like a great opportunity for expansion. But unless you have the infrastructure & resources in place, it’s not going to work out.
The desire to expand isn’t a bad thing, so long as you’re prepared. Security companies need to enter new markets strategically. This could mean replicating your past success, and not just to stretch your operations over a bigger part of the map.
If you want to expand into new territories, you need to set up an office there with proper management, supervision, and sales — and set up two or three good contracts before you go in. Property expansion strategy will also motivate your security sales team because they will feel like they didn’t just get dropped in the deep end.
Alternatively, adding new service offerings to existing clients and penetrating deeper into your current customer base can provide revenue growth without the need to explore new territories. Look at what you and your competition are currently offering in your market; if you aren't meeting the demands of the geographic area, then maybe its time to expand your service lines to meet those requirements. Utilizing new technology to improve existing client relationships will only benefit your business in the long run.
There’s more to effective security management than many people realize. If you’ve spent any time in the security guard industry, chances are you’ve seen first hand how an effective manager will control a situation and motivate their employees to create value for clients. And chances are you’ve seen the opposite as well.
Becoming a manager yourself isn’t always easy though. Here’s what you need to remember:
You can’t singlehandedly make your guards better at their job. Instead, give them the tools they need to avoid mistakes.
Writing incident reports is a part of the security business that causes a lot of people to struggle. People who don’t have a background with writing can find it difficult to put experiences into words, especially in situations where specific industry terms are needed.
Using security guard management software to help assemble reports, as well as organize and complete tasks and checkpoints, can make a big difference. The end result is automated client reporting that looks much more professional than a handwritten report.
Making the job easier can help guide your “C” guards and make them into “A” guards. Guard management software is made specifically for the private security industry and makes the tedious, time-consuming parts of the job effortless. When the job is easier and more enjoyable, you will keep your “A” guards on the team longer, all the while improving average guard performance. And it will help you save time & money spent processing pen & paper incident reports and limit client turnover.
Not only will the right tools make your expectations clear and limit mistakes, they make security guard management for you and your supervisors much easier.
Trust is the most important aspect of effective security management. Without trust, your relationship with your team can quickly become adversarial. An us-vs.-them dynamic can quickly poison relationships and end contracts — and, in many instances, whole companies.
The most important way to build trust with your officers is to pay them consistently. Always pay your people on time. When you start missing payroll, people start looking for new jobs. It’s as simple as that. Work towards having six months’ worth of payroll in the bank to make sure you’re never late on payday.
Don’t think you can pull one over on your guards either. People know when their managers aren’t being forthright with them. That can create an unstable feeling that leads your better officers to find a new company. When you lie to your employees, they’ll lie to you in return.
Break an employee’s trust and they’ll find ways to make you pay. They’ll start to badmouth you to their friends, saying you aren’t running a trustworthy security company. That’s how you end up with a bad reputation in the community. Some will go the next step and badmouth you to their point-of-contact with the client. That’s how you start losing contracts.
Leaning on your guard management software is another great way to build trust with your guards. Many guards, supervisors, and even security company owners think guard tour software negatively affects trust. But software doesn’t have to be all about “keeping tabs” on untrustworthy officers. In fact, it can be just the opposite.
You can use your guard tour software to reward good behavior and performance of your best guards. This will show all of your employees that you are tracking performance and considering it in raises, promotions, etc.
When a good employee leaves, they take your investment in training and experience to another company — usually a competitor. A trusted guard with a strong client relationship can bring clients with them when they change companies.
Here’s one thing a lot of first-time owners don’t know. The assumption is that you have security guards on site, and a security guard supervisor who goes around, you know, supervising them. That’s how you keep track of your guards and make sure they’re held accountable.
What happens in reality is much different. Your security supervisor will inevitably end up spending hours hanging out with their favorite guys, smoking cigarettes and chit chatting instead of creating value.
This wastes payroll, not to mention the financial impact on your vehicle — gas, mileage, maintenance. None of this leads to an efficient operation. Even if your security management team members are doing their job well, they aren’t cheap to utilize. Supervisors are a bigger hit to payroll than guards and the financial impact from the vehicle they use to get from site to site isn’t small.
In addition, a heavy reliance on your supervisors to hold officers accountable sets the expectation that when a supervisor isn’t around, officers can do whatever they want.
Instead, use a guard management software like Silvertrac that’s designed to supervise guards electronically, using check-ins, time punches, reports, and GPS tracking to prove accountability. When you automate security guard management, you only have to send your supervisors out to do post inspections when they are notified that an officer isn’t performing their duties.
Stop paying someone to babysit and turn your security company into an efficient, well-oiled machine.
Effective security management isn’t just about giving orders. Lines of communication should run up the ladder, as well as down. If you aren’t hearing about problems that are happening on the ground, those problems aren’t likely to be solved. Over time, those small issues can build into something big that leads to a lost contract.
Don’t let your security supervisors cut problems off before they get to you. If something is happening, it’s your job as the boss to know what’s going on. Keep in mind that you’re a security company, not a police station. A lot of security officers will mistake rank for ability, but “lieutenants” are not necessarily managers. Ensuring that you’re engaged in top-to-bottom communication prevents your employees from trying to fix problems that require more than their skill or experience to handle.
Always have a way for employees to reach out. Offer them a phone number, email address, or an open door to your office when they want to voice concerns.
Don’t see growth as an opportunity to delegate work to other people just because you can. A growing security guard company needs an actively engaged owner more than one that is barely getting by. Don’t pass the buck on supervision and management.
You’ll need to stay in charge to guarantee continued client success. That means keeping track of your wins and honest reflection on your mistakes. Learn from what isn’t working and experiment! Try new things and see if you can optimize your force. Don’t get complacent with the status quo.
And be sure to protect what’s most important to the health of your company. Limit access to bank accounts, personal documents, contracts, and other vital documents. Company secrets should be kept close to the vest. Contract security is a cutthroat industry and your best managers could be gone tomorrow — off to another company with all your secrets in tow.
There's a lot of helpful tips in this guide. Perhaps the most important tip, however, is this: Don’t forget your duty to your family & personal health. The people at your guard business can feel like family, but your first obligation should always be the ones at home. Don’t worry about the kids at work, worry about your own kids. Make your guard business a second family, not the first.
Don’t undervalue safety and security management. Keeping your guards safe should be a top priority when they are on site. Make sure they are properly trained and placed to be in the safest environment possible.
Starting your own security company takes guts. It’s a lot of hard work, but when you do good work, people notice. A good reputation is the most valuable thing in this industry. The more value you create for clients, the more you impact their day-to-day operations. Your success and the success of your clients are closely tied to one another. The more successful you make others, the stronger your company will become.
Luckily, in this day and age, finding help and advice on how to run a security company isn’t hard to come by. Check out Thinkcurity, the leading physical security industry thought leadership website. You can find dozens of free articles, expert-led webinars, and downloadable resources to help you tackle the biggest challenges in the private security industry today.
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