Fire Safety Companies: Key Things to Consider as a Buyer or Investor

closeup red fire safety alarm box

Fire protection companies share a common purpose: to provide and maintain equipment that detects fires, extinguishes them, and alerts both occupants and fire departments of their presence. To put it more briefly, fire protection companies help provide a first line of defense for homes and businesses in the event of a fire. This equipment can help save lives and minimize property damage by responding to the fire immediately, while the first responders are still on the way.

Though they share a similar purpose, there are many differences between fire protection companies. It is important to understand these differences if you are considering adding a fire protection company to your portfolio.

If you are the owner or operator of a fire protection company, understanding your competition is also important. Knowing how your services compare to those of other fire safety companies can help you identify opportunities for growth, or know your unique value to the market as you consider selling your own businesses.

Though we cannot cover all the differences between fire protection companies in this article, we’ll look at three big differences that can help investors and business owners alike identify opportunities for success.

Is the Fire Protection Company Full Service?

A full service fire protection company offers a wide range of fire and life safety services. These often include the installation and maintenance of various types of fire suppression systems, fire sprinkler systems, fire alarm systems, and fire extinguishers. These companies typically handle every part of the process, from installing or updating the initial systems or equipment to inspecting it according to a regular schedule and performing any required repairs or maintenance over time.

Other fire protection companies only offer some of these services. This can be especially true when it comes to different, specialized types of fire suppression systems or fire alarm systems. It is not uncommon for a company with locations across states to offer different ranges of services based on each area’s licensing rules or the ranges of experience among their technicians.

Full Service vs. Specialized Companies

It’s important to note that the amount of services a fire safety company offers does not reflect its size. There are some that choose to specialize in one area of fire protection.

This can be commonly seen with fire sprinkler and fire alarm companies. Since these services can be built out into very complex and profitable stand-alone businesses, some owners who start with expertise in one specific area choose to build their company around it and do not need to expand services to grow.

While some of these specialized companies offer a small selection of additional fire safety services, others may choose to form strategic partnerships with other fire protection companies in the area. This can be a win-win for both companies: the specialized company and the more comprehensive one can offer a wider variety of quality services to their customers.

Do They Offer Any Integrated Security Services?

Some fire protection companies also offer integrated security services, such as access control or video surveillance. This is common of fire alarm companies, as the types of skills and certifications necessary to handle both fire alarm and security alarm systems is similar.

An integrated security company is uniquely appealing to investors, as their services often start at high dollar amounts and require even more regular maintenance and inspection than some other fire and life safety services.

In many cases, integrated fire safety companies are more specialized. They tend to focus on the technical and electrical side of all types of fire protection. This can be a great opportunity for an investor who is interested in acquiring a couple fire and security companies and combining them to form a full service business.

The option to add integrated services is also a natural way for a life safety company that already offers fire alarm services to expand their own service offerings. It’s worth looking into the pros and cons of integrating safety systems and to learn more about the competition in the area if you are considering this option.

Are They Commercial or Do They Also Provide Residential Protection?

Some fire protection companies focus on the commercial market, while others also offer residential life safety services. Local companies are often compelled to offer residential services due to a demand from the community. But, handling residential safety is different than commercial and can involve additional work that does not always fit in with business-oriented offerings.

A company that has the goal of growing a large presence across several areas will often choose to focus on commercial fire protection services. Commercial customers have larger budgets and are looking for the types of solutions that demand more extensive products and support. These create monthly recurring revenue that can support a business.

On the other hand, it is difficult to support a growing company with residential safety services alone. Depending on each state’s laws, some residential security companies may choose to offer basic fire protection services as well.

Both types of companies can be valuable for your portfolio, it just depends on the long-term goals for your investment. As a business owner looking to expand fire protection services, residential may not be the right path to explore. Rather, consider other fire and life safety services you can add to your business.

Ready to Sell or Expand Your Fire and Life Safety Business? Contact AFS Today!

As you can see, there are many factors to consider when evaluating fire protection companies. From their range of services to their specialization in certain markets, understanding the differences between companies can help investors and business owners alike identify opportunities for growth and recognize their value.

If you are ready to sell your fire and life safety company, interested in expanding your services, or looking for the right fire safety company to add to your portfolio, AFS is the perfect partner to help you achieve your goals.

With over 30 years as a fire and security business broker, owner Rory Russell has the connections and experience to help you navigate the sale of your business or find the right company for your investment. Contact him directly today to get started, or give him a call at 800-354-3863 to learn more.