Whether you are ready to start something new or want to diversify your investment portfolio, service-based businesses can be a great source of revenue. Companies that install and service fire protection equipment and alarm systems are a solid choice for buyers and investors. But, they are different from other maintenance companies.
As you begin to search “fire protection companies near me” and learn more about the options in your area, there are three key factors to understand. These factors can impact the success of each fire safety business and your ability to grow or expand it after your purchase.
Licenses and Certifications Determine What Services You Can Offer
To perform most commercial fire protection services, technicians must pass special licensing and certifications testing. These differ by area and by service.
To offer fire alarm and fire sprinkler system installation and service, every fire protection business has to have a license-holder who has passed the state Fire Marshal’s tests for that service. Some states require license holders for fire protection services that go beyond alarm and fire sprinkler systems as well.
Technicians also have to pass various levels of training and testing to install and service fire safety equipment. If you are thinking about buying a fire protection company, you want to learn more about how many qualified staff members each business has. If the business has a limited number of skilled and certified technicians, its ability to operate is in jeopardy. A company with more certified team members will be a safer investment.
If the business is not full service, you will have to find certified industry professionals before you can add new services. Or, you can offer to pay for the training and certification of someone on your team. Keep in mind, it can take years to earn the licenses and certifications necessary to offer some types of fire protection inspections and services.
Each State’s Laws Are Different, Which Impacts the Markets and Talent
Another important factor to consider is that the fire protection industry is affected by state laws and regulations. In some states, technicians need to have state-based certifications along with those from national organizations like the NFPA and NICET.
For example, in many states fire alarm technicians must hold NICET certifications. This is especially true if they are repairing or installing the alarm systems. Some states require a certification to inspect and service fire extinguishers, while others do not. Water-based systems and specialty suppression systems also have their own certification requirements.
This is important, because fire protection technicians cannot transfer between states and still perform the same inspections or services. Annual inspections of fire extinguishers and related fire extinguisher services are the easiest to offer in a new state. This is because the certification requirements are the lowest. But, fire sprinkler inspections and service can be very difficult to transfer and it can take a long time to earn certifications in a new state. This is also the case with fire alarm systems. It depends on what licenses and certifications a technician holds.
It is important to know these things if you are thinking about becoming the managing owner of a thriving fire protection business in one state. If you’re hoping to expand the business into new territories, your new employees may need extra training before they can help!
Vendor Relationships Can Make or Break Your Business
It’s also crucial to look at the relationships each company may have with vendors. Your fire protection business will rely on a variety of suppliers for equipment and parts. So, it’s important to know if there are any restrictions or exclusivity agreements in place. For example, some companies may only be able to buy certain products from one supplier. Others may not be allowed to resell certain parts or materials.
This can not only impact your profit margins, but also limit your potential customer base. Fire protection systems do not use interchangeable parts. There are only a few primary manufacturers of fire suppression systems. If you are only an approved vendor or supplier of one, you cannot sell your services to any restaurant or business that uses the other.
Ready to Buy? Talk with Fire and Security Owners Today!
It is important to talk with life safety experts to learn more about the factors that impact success in this industry if you are thinking of entering it. That is why AFS is the right “one stop shop” for you! Managing owner Rory Russell not only has industry experience himself, but also has spent the last three decades working with owners in the fire and security industries to help them grow and sell their businesses.
To learn more about if the fire safety industry is right for you, you can call Rory directly at 800-354-3863. You can also fill out our confidential form here. Within a couple days, Rory can connect you with interested sellers and help you understand more about what it means to run a commercial safety business.
For more information, you can also check out our page for buyers here. We look forward to working with you!