Buy a Business

The Alarm-Security & Life Safety Industries are one of the most profitable and secure Businesses to be in. They do well in faltering economies and COVID 19 type of Business slow downs. The Customers need their continued protection, and are required to have their protection systems inspected and Serviced every 6 month or every year. Most Insurance Companies will not Protect a Business unless they have Proper Protection.

This 25 year old Businesses has always been focused on Certified-Approved Fire Alarms connected to the 24 hour UL Certified Central Station. A big value of this Business is the R.M.R. (Reoccurring Monthly Revenue). His 130 Monitored accounts produce $9,200 of R.M.R., the Value of these accounts are about $368,000. When you do a Valuation of an Alarm-Security Life Safety Business, you need to look at 4 Major areas.

“A” The above R.M.R.,

“B” and like any Business you will want to look at the Cash Flow & the EBITA, This Businesses Earnings at the end of the year will be about $180,000 @ a 4 times earnings that would be$720,000. Today this Company is FOR S450,000 to $500,000, based on it’s ability to produce about $40,000 in monthly gross sales. Yes the sales went down in the last 10 months of this crazy Pemdemic, but is Net was close to the same because of all of his R,M.R, and inspections. His overhead was Rock Bottom.

“C” You will want to look at each of his “Profit Centers”, the Life Safety Industries Collectively have about 50 Profit Centers (look at -- lifesafetyassociation.org for a list of all 50). The Average Life Safety Companies use 8 to 12 Profit Centers. This SELLER has 14 Profit Centers and is ready to add about 5 more after the 1st of the year. He will be adding Fire Extinguisher Sales & Service plus the required annual Inspections. He will also be doing the Inspections of Fire Sprinklers and the Water Backflow required Inspections. Everyone of his present Fire Alarm Customers have Fire Extinguishers and on the average 2 Water Backflow devices that must be inspected each year. These additional Life Safety Profit Centers are very profitable and make it easier to get new Customers.

“D” The value of New R.M.R. accounts added each month. The average New monitored account produces an average of $30 per month. Each account is worth about 35 times the R.M.R. or a solid $1,000. Fire Alarm account pay a higher fee for their R.M.R, on the average $52 per month instead of $30 per month. So each one of his new Fire Alarm Accounts is worth $1,820. I do not want to loose you because this is a most important fact. Many Alarm-Security Customers Sell their accounts each month to Investors who pay the “Dealers” to service the accounts. On a conservative basis they pay $1,000 for each account, If you are putting in 4 accounts per month and wish to “Cash Them Out”, you can add $4,000 to your Net Profit and Cash flow. Next year this Business will be installing an average of 12 New R.M.R. systems each month.