If you’re contemplating making a significant change within your alarm business – for instance if you’re feeling the urge to sell your company – chances are you’re carefully assessing the potential benefits and risks.
While selling a security, fire or integration business or monitoring station can be highly advantageous and profitable, helping you take the next step in your career (whether that be moving on to a new opportunity or retirement), doing so also comes with risks. Knowing how to avoid and mitigate those risks as you approach the sale of your organization is key.
Here, we share our top tips for avoiding the potential hazards and risks of selling your security business.
How To Mitigate Risk in the Sale of Your Fire, Alarm or Security Company or Monitoring Station
Putting your business on the market and coordinating a profitable sale can be a challenge that comes with some amount of risk. Here are a few key ways you can mitigate that risk and increase the chances that the sale of your business will go smoothly.
Documentation is important, but it’s especially important as you’re approaching a potential sale. Be sure that any promises you make to employees or stakeholders are a) promises you can keep and b) documented in writing. You’ll want this information to be recorded in a way that you can refer back to so it is not overlooked during the sale negotiations or process.
Additionally, you’ll want to make sure that your organizational processes and procedures are documented as well. It’s a good idea to have everything in writing as you approach a significant transition so the change can be as smooth as possible.
As you’re approaching the sale and working to select the buyer and offer that’s most appealing, you’ll want to be sure to carefully document all meetings, discussions, and correspondences. This will enable you to look back and know that the information and data you’re analyzing is correct, thorough, and accurate. Don’t rely on memory to keep it all straight!
Work With a Trusted Broker
Working with a broker is one of the best ways you can go about mitigating risk when it comes to selling a fire, alarm, security, or integration company. Brokers know the industry in and out. They can help to keep you informed of the risks that you may be susceptible to in the current market, and can advise you as you navigate the selling process in ways that will help you to avoid potential hazards.
They’re also connected to qualified sellers and understand the ins and outs of valuations and contracts, which means they can help to put you in touch with parties who are willing to pay top dollar for your organization and are well qualified to continue the legacy of success that you’ve worked hard to establish.
Don’t navigate the sale process alone! You can learn more about the advantages of working with a security business broker to sell your company here.
Understand Mistakes to Avoid
During the process of selling your business, knowing what NOT to do is just as important as knowing what TO do. By gaining a solid understanding of the mistakes you should avoid as you approach a security business sale, you’ll protect yourself from risks and hazards you may otherwise fall prey to.
Need a quick refresher on some of the key mistakes to avoid when you’re selling your company? We review 8 mistakes to avoid when putting your alarm business on the market here.
Prepare Well Ahead of Time
Think a sale is in your future? If you’re even considering an alarm, security or fire company sale in the foreseeable future, the time to start preparing is now.
Having your ducks in a row can help you see potential weaknesses that may leave your business vulnerable, find shortcomings that you can improve upon in order to improve your profit potential, and further highlight your organization’s strengths in order to make your company increasingly appealing to potential buyers.
Wondering where to start when it comes to preparing your alarm business to sell? We share some key ways to prepare your alarm business for sale here.
Being well prepared well ahead of time can help protect you and your company from potential risks, so it’s well worth making the effort to prepare your business as best you can.
Make Sure Your Contracts Are Solid
This likely goes without saying, but it’s important to make sure that any contracts or agreements you sign during the negotiation and sale process are solid. As mentioned, working with a broker is highly recommended – and one of the perks of working with a broker is that you’ll have another set of skilled eyes looking at any agreements you’re negotiating.
You’ll also want to make sure that any contracts you have in place with customers and clients are up to date and accurate as well.
If you’re reviewing your contracts and looking to make some updates, be sure to check out the alarm industry contracts offered by Kirschenbaum & Kirschenbaum PC. These are professional contracts that are thoroughly detailed and can point you in the right direction if you’re looking to upgrade your agreements as you approach a sale.
You don’t want an oversight to put an otherwise successful, profitable sale at risk. Work with a broker and make sure your contracts are thoroughly reviewed.
Stay Engaged in the Process
Finally, it’s important to recognize that the sales process in the alarm, security, fire and integration industry can be a long one. It can be tempting to disengage from the process once it’s underway, but staying involved and vigilant is key if you’re hoping to avoid hazards and make the most of the sales opportunity.
Even if you’re working with a broker, make sure that you stay in the loop to ensure that your interests are being properly represented. Be willing to be an advocate for your business from start to finish, and keep an eye out for risks that may be presented as opportunities – such as selling to a search fund.
Keeping yourself informed and staying personally involved is another important step if you’re hoping to steer clear of the hazards that come with pursuing a sale.
Minimizing Risk During Alarm Company Sales
There is always some level of risk involved when it comes to making a significant change within your organization. Fortunately, for those in the first, security, alarm, and integration industry looking to sell their businesses, many of these hazards can be avoided or mitigated.
As an experienced alarm broker with decades of experience handling multi-million dollar transactions, Rory knows the ins and outs of the industry and can serve as a helpful guide and advocate as you work to sell your company for top dollar.
Interested in learning more about preparing your business to sell for top dollar? Get our 5 tips for maximizing the profitability of your alarm company sale here.
Wondering if you’re ready to put your security, fire, or integration business on the market? Here are 8 key questions to ask yourself before taking the first step towards a sale.