Selecting a Central Station
Infrastructure is a consideration in making choices
- By Kevin Lehan
- Apr 01, 2015
Independent alarm dealers have much at
stake when choosing a central station that
will enable them to compete with the industry’s
largest companies.
The most important part of the evaluation is
reviewing the contract that governs your relationship
with the central station, which is your most
crucial vendor. Check the language closely, so you
don’t encounter surprises about your obligations.
You should also consider the breadth of services
a central station offers and how you could
sell those to new and potential subscribers. This
affects the recurring monthly revenue (RMR)
you are able to generate.
Lastly, excellent and ongoing subscriber service
is essential, so be sure to ask questions about
monitor training, quality-control programs,
staffing levels and the central-station infrastructure,
including where its back-up facilities are
located because having them too close or too far
away is not smart planning. This will give you a
good idea about that company’s ability to provide
the mission-critical task of monitoring your customers’
alarm systems.
Look for Dealer-Friendly
Contracts
Building a subscriber base that generates RMR is
what every alarm dealer strives to achieve. However,
one of the greatest risks dealers take is when
they sign contracts for monitoring that lay claim
to this asset.
When choosing a central station, be sure to
consider these contractually important points:
- Do you maintain complete account ownership?
- If you fall behind on billing, do you forfeit
your accounts?
- Can you cancel accounts with no obligations
or cost?
- Are cancelled accounts refunded pro-rata to
the day?
Some industry contracts even have a right of
first refusal for a dealer’s accounts. Think about
it—if you wanted to sell your accounts (or the
company), after you have performed all of the
due diligence, the central station can match any
offer or even claim the accounts based on a predetermined
formula that could be lower than
what you could get on the open market. Contracts
like that strip away the autonomy of being
an independent business owner.
It’s All about RMR
Maximizing RMR is how companies grow. Dealers
do that by suggesting and selling additional
services to meet the needs of their customers and
entice new ones.
When evaluating a central station, keep in
mind that they must be able to monitor all types
of accounts. That includes the older, current and
next-generation technologies that will come
to the market. It means acceptance of all of the
standard reporting formats and communication
technologies in case you purchased accounts
from multiple dealers. It should also allow monitoring
of specialty accounts, like jewelry stores,
banks, commercial-fire systems, as well as intricate
video-alarm systems.
The growing demand for video is due to the
positive press those systems receive when captures
are made and the footage is shown on TV
news. It also helps that hardware prices are dropping,
so now is really the perfect opportunity to
promote video to new and existing customers.
For example, video for event verification is
a common use now because some emergency
response agencies require confirmation that a crime is happening before dispatching police. One solution to ensure response
when needed is to incorporate video equipment that triggers a signal
should an alarm-event condition be met, such as motion being detected
when an area is to be vacant.
When an alarm event happens, a video clip automatically transmits to
the central station for immediate review. Central-station monitors then become
digital eyewitnesses to the actual event, thus empowering them to tell
the PSAP that there is a crime in progress by describing what they saw at
the property. This witness verification raises the priority for dispatch and
hastens response by officers who want to make arrests at the scene.
Dealers can market video as a labor-saving system. “Video guard” and
“video guard tours” are custom applications you can offer to maintain security
in a specific area or throughout a property. For video guard service,
the subscriber specifies a window of time during which a central-station
operator monitors a recurring event via a system-connected video camera.
Often, this is used to oversee the completion of a transaction, such as delivery
of materials or depositing of funds into a safe each night. This real-time
observation helps ensure the integrity of such events. Also, by outsourcing
the supervision of recurring transactions to a third-party company, the
possibilities of collusion are virtually eliminated.
A video guard tour is another customizable service that could eliminate
or significantly lessen the cost of hiring a team of guards. For both
homes and businesses of all sizes, central station monitors are able to “tour”
a property by accessing a specified list of cameras and scanning for exceptional
conditions, events or unauthorized entry. This type of visual tour of
the property can take place multiple times each day, depending upon the
subscriber’s needs.
A video system can also act as a “digital doorman.” Depending on the level
of security needed at the premises, digital doorman service can be arranged
to keep an image record of every person entering a premises for later review
(if needed) or a central-station operator can be empowered to grant or deny
access to certain zones, as spelled out in dealer-defined protocols.
The image-logging service is a simple and cost-effective way for a customer
to see who was in the premises at a certain time/date should there be
an incident that inquires investigation. The more intensive access-control
service requires central-station operators to confirm identification information—
often a passcode—before allowing a person access to certain zones.
Subscribers Want System Engagement
Your customers expect what the competition is selling on TV: access and
full system control through a smart phone or a desktop computer.
This includes arming/disarming, remote video access and alerts when
certain alarm conditions occur such as open/close, which is used commonly
to alert system owners when their children enter the home. That alert
could prompt Mom or Dad to access the system’s video cameras to see if
their child is doing their homework.
Some families even choose to have certain zones within the system send
immediate notifications of an alarm event. This could be set to notify if the
liquor cabinet or a gun safe was accessed or an office breached. Other uses
for open/close notification are alerts when the cleaning company or a dog
walker arrives and leaves.
The same principles of notification apply to commercial systems too—
when the customer wants to be alerted of a certain event, they can be informed
by text or email.
If they want to witness the unloading of materials at the dock, they can
log in to their system and remotely watch this too. With today’s technology,
virtually any system-connected device can give a status report or notify
subscribers via your central station, including mechanical systems, thermometers,
humidity gauges or gas sensors, to name a few.
Subscribers Want Courteous Service
When there is an alarm event, your customers want quick, courteous interactions
with knowledgeable monitors who provide accurate information.
While every central station will promote that they provide a high level of
customer service, be sure to ask about their training procedures and staffing
levels. Find out about quality-control measures and how they evaluate
monitor interactions with subscribers. This will give an indication of the
importance the central station places on servicing your customers.
Be sure to ask about basics things that are important to your customer,
such as:
- How many rings to pick-up an inbound call?
- How long does it take a subscriber to receive a call after alarm activation?
- How is the telephone answered? Using a generic name or your
company name?
The answer to each of these questions should help you determine which
central station will best serve your customers.
Your Central Station as a Marketing Tool
Most consumers assume they have reliable protection with a monitored
system. However, alarm dealers know there is a tremendous difference between
a third-party audited (UL or FM) central station and one that maintains
an alarm receiver and employs a few call-takers.
The reason third-party audits are important is that when it comes to
alarm monitoring, failure is not an option. There must be built-in fail-safes,
contingency plans and multiple locations to achieve true redundancy. A
simple generator does not cut it. Further, to satisfy UL and FM, there are
training and staffing provisions that must be followed, as well as periodic
testing procedures that must be performed.
Many central stations boast that they have redundancy in their system.
The issue is not redundancy, but instead, “Where is the redundant backup
facility?” Is it so close that the same tornado can take it out with the
primary station? Is it on the same electrical grid that could affect both if a
regional disaster occurred?
Or is it too far away? For example, Station “A” is located on the east coast
and Station “B” on west coast. Let’s say both stations operate at 50 percent
of capacity, handling 10,000 signals and request calls a day each. If Station
“A” fails, the company switches all of the signals and phone calls to Station
“B.” Switching the signals and calls is not the issue.
The issue is that Station “B” may not have the staffing to handle the additional
signals and request calls in a timely manner because the company
cannot pick up and move its east-coast monitoring staff to the west coast.
The result is that alarm signals sit in queues and inbound phone calls go
unanswered.
To use your selected service provider as a market differentiator, make
sure your customers understand that a central station’s redundancy should
be purpose-built to allow the smoothest transition if a disaster occurred, as
opposed to building another facility just because UL requires it.
Just remember, it is up to each alarm dealer to decide who they want
representing them to their customers, but one thing is for sure, monitoring
is not a commodity service.
This article originally appeared in the April 2015 issue of Security Today.