3 Places to Look for Valuable Contracted RMR

Service Contract agreement document with blue pen to sign name on the signature line

If you’re a business owner in the security or fire alarm industry, you likely understand the value of recurring monthly revenue. It’s one of the major factors that can help you build value within your company, and a key element that buyers look for when it comes time to sell.

But if you haven’t explored all of your options for sourcing RMR, you may be missing out on valuable opportunities to increase profitability and augment your company’s value. 

Wondering where you can source additional contracted recurring monthly revenue for your business? 

Where to Look for Contracted Recurring Monthly Revenue To Grow Your Business’ Value

Whether you’re planning to sell your alarm business in the near future or you’re hoping to stay in the game for a while longer before implementing your exit strategy, here are three key places to look for valuable contracted RMR that can bolster profitability and add value to your organization.

Service and Maintenance RMR

Service and maintenance will be a necessary component of the ongoing assistance you’re offering to your clients and customers, so it makes complete sense to create a contract or subscriber agreement that enables you to charge for it on a recurring basis. 

Rather than charging for the time and materials you use to service and maintain the systems your clients rely on, bill service and maintenance fees as contracted recurring monthly revenue. This will make your service and maintenance revenue even more valuable, both now and in the future when it comes time to sell.

You can learn more about the value of service revenue (in the fire alarm industry specifically) here.

Monitoring and Remote Management RMR

For many alarm businesses, monitoring and remote management are key offerings that clients are willing to pay for. In fact, they’re some of the main features that today’s consumers are looking for when they’re selecting an alarm system provider. 

As such, it should come as no surprise that monitoring and remote management RMR specifically has the potential to be incredibly profitable. Keep in mind that this can be a source of high margin RMR. Be sure you’re charging accordingly and review your fees routinely to ensure that you’re keeping profitability up.

Test & Inspect RMR

Test and inspect revenue is a huge asset – both when you’re running a fire alarm business and when it comes to fire alarm company sales. Contracted test and inspect revenue is guaranteed income for you – or for a potential buyer – and it’s a major reason why traditional valuation models often don’t work for accurately calculating the value of fire alarm companies. 

Again, if you can bring in test and inspect revenue through a subscriber agreement rather than charging one-off fees for tests and inspections, you have the potential to build increased value and generate additional profits for your business. This, in turn, can also lead to a higher profit margin when it comes time to sell. 

Learn more about test and inspect revenue here.

Build Company Value Through Contracted Recurring Monthly Revenue

RMR is hugely important for alarm businesses for key reasons. It has the potential to: 

  • Increase alarm company profitability
  • Increase company value
  • Enable companies to capitalize on the Internet of Things
  • Enable highly profitable alarm business sales

You can read more about what makes RMR so imperative for alarm business owners here.

As such, seeking out additional sources of recurring monthly revenue is never a bad idea – and locking down contracted RMR is huge if you’re looking to build company value. 

Interested in learning more about what it would take to transform your company’s recurring monthly revenue? Wondering where to begin when it comes to generating additional contracted RMR? Give Rory Russell a call at 800-354-3863 or contact him online to get the conversation started.

Rory has been helping alarm business owners in various industries build value and sell for top dollar for decades. He knows what it takes to augment revenue in a way that encourages potential buyers to pay top dollar when you’re ready to exit the industry. 

Looking to learn more about RMR in the security and fire alarm industries? These resources are a great place to start: 

Commercial Security: The Secret to Growing Your Alarm Business RMR – Learn more about pursuing opportunities for recurring monthly revenue within the commercial security industry.

Increasing RMR with the Internet of Things – Find out how the Internet of Things has opened up new opportunities for recurring monthly revenue in the security industry.

Calculating Monthly Recurring Revenue – Gain a more accurate understanding of the revenue your organization is generating on a monthly basis so you can better understand the true value of your business.