Keep It In Order: Maintenance and service contracts - By Darlene Bremer

"As security systems become more sophisticated and complex, proper maintenance has become increasingly critical. Gone are the days when electrical contractors could just install a system and then walk away. Customers need maintenance and service agreements to avoid costly expenditures if the security system experiences operational issues, and contractors should pursue what is potentially a huge market.

Unfortunately, the current business model of most electrical contractors of hiring electricians per project does not support offering security system maintenance and service," said Kurt Brinkman, CEO of Intrepid Electronic Systems Inc., San Jose, Calif.

Maintenance and service agreements require contractors to have technicians on staff to perform the work, which requires an upfront investment for hiring and training.

The standard protocol for maintenance and service agreements is to ensure that the security system is operating correctly, that all systems have the latest software patches installed, to clean and focus any cameras that may need it, and to exercise and test all components of the system.

'Some customers also hold minor service calls to be handled that same day,' said Jason Howell, vice president of Mona Electric Group Inc., Clinton, Md.

Some of the more high-tech responsibilities that can fall on the contractor include maintenance of the security firewalls, the batteries and uninterruptible power supplies that backup the control systems and security devices, and the systems' access and interface devices and their central station connections to ensure proper transmission of alarm information.

However, some customers may require more, while others require less than the standard protocols. Therefore. the maintenance agreement is the vehicle that lays out all of the contractor's duties and all of the end-user's needs, according to Brinkman.

'A well documented and measurable agreement will ensure that the client understands what work is going to be performed and that the electrical contractor understands the client's expectations of the scope of work and the desired outcomes,' Brinkman said.

Agreements benefit contractors

Maintenance and service contracts benefit the contractor by building and preserving a long-term relationship with the customer.

'The customer knows that the contractor is the source that will help them with their security needs and with troubleshooting the system,' Howell said.

In addition, if the customer knows the system has all the latest software patches and has undergone monthly checks, many of the steps in the troubleshooting process can be eliminated.

Perhaps the biggest benefit is the recurring revenue that maintenance and service agreements offer.

'Clients paying a monthly or annual fee for services rendered is not included in traditional contacting work and provides known revenue amounts for the contractor,' Brinkman said.

Maintenance and service agreements also stabilize the contractor's workflow.

'The contractor now has a known backlog of work and known labor requirements,' he said.

...and customers

Service contractors benefit the customer because it take the burden of ensuring the security system is functioning properly off of them and places it on the contractor. According to Howell, it also ensures the customer's security system is always up-to-date, which is a requirement in obtaining customer support from the manufacturer.

'The goal is also to solve issues with the security system during a routine check, rather that have a security breach,' he said.

Overall, maintenance and service agreements simply provide the building owner and the tenants with high levels of confidence that the system will provide the required, and desired, security and life safety functions.

Making the shift 

'To begin incorporating security system maintenance and service contracts into their offerings, contractors must understand the security and other low-voltage technologies involved,' Brinkman said.

For example, contractors need to learn what products are available that fit into their market niche. In addition, they need to invest in hiring the required staff and in providing for factory or other training in those products, systems and controls.

Of course, there are challenges in making the shift, in addition to having staff on call 24 hours a day. According to Brinkman, the contractor involved in maintenance and service needs a vehicle stocked with parts that might be needed.

'Clients expect that the system will be repaired immediately and do not want to wait for the technician to get parts,' he said.

The contractor would also be well-served to learn about maintenance and service agreement billing.

'Billing in this market is done by the individual customer and not by the project,' Brinkman said. 'The contractor might also have to accept credit cards and the remote apps that enable acceptance of credit card payments.'

Finally, tracking technology, and/or a service dispatch software package for notifying clients that a technician is on the way, might also be an excellent investment."

Source: http://www.ecmag.com/section/systems/keep-it-order-maintenance-and-service-contracts