Small business

How to Starting a Security Alarm Business

Starting a security alarm business may be easier than you think, but it still requires you to meet specific federal and local government regulations, as well as specific business registration requirements.

Critical Things to Know Before Starting a Security Alarm Business

Here are the critical things to know before starting a security alarm business.

1.     Determine the Type of Alarm Business You Want to Open.

You have primarily three options when starting an alarm business:

  1. Sell and install 3rd party alarm systems with no ongoing monitoring
  2. Sell and install 3rd party alarm systems with ongoing monitoring
  3. Sell do-it-yourself alarm kits to homeowners

The most lucrative of these options is the first one. By including ongoing monitoring as part of your services, you’ll be able to generate a steady stream of regular income.

2.     Research Permits and Licenses.

Most of the permits you’ll need will be at the state or local level. One of the best places to research any requirements is to your local and state law enforcement bureau. You can also use online tools, such as License123 to conduct a comprehensive search of licenses you’ll need.

Some of the more common licenses to be on the lookout for are:

  1. Alarm Company Agent License
  2. Alarm Company Reseller Permit
  3. Alarm Company Operator/Manager License

Also, you will need similar licenses and permits to these in the case where you are operating multiple branches of a business or install alarm systems:

  1. Alarm Company Branch Office License
  2. Private Patrol License
  3. Private Patrol License – Branch Office
  4. Low Voltage Systems Contractor License

In addition to these specific permits, you’ll also need the standard business permits and licenses, including a seller’s permit, state, and federal tax certificate and file a Doing Business As (DBA) form.

3.     Develop a Business Plan.

By defining your type of business and your goals, you’ll be able to determine:

  1. Size of retail and office space needed
  2. Type and size of sales, installation and customer service teams
  3. Necessary start-up capital
  4. Revenue projections and overhead costs
  5. Marketing and advertising options

4.     Look for Funding.

Explore all types of funding options for your business including small business loans and grants, loans from financial institutions and crowdfunding. When creating your budget, you’ll want to consider questions like:

  1. What’s the best way for you to generate the capital you’ll need to start your business?
  2. How much do you need in start-up costs and when do you project the business will become profitable enough to sustain itself?

5.     Hire Your Team.

Chances are you’ll need to hire installers who are licensed to install low voltage electrical systems, as well as salespeople and customer support representatives. You may be able to start small or may consider hiring employees as independent contractors until your business is profitable and you can afford things like employee benefits. However, you decide to proceed, be sure that you have enough people on payroll to support your early customers. Chances are your earliest customers will become your greatest advocates and their negative experience could hinder your future growth.

If you decide to start a security alarm business be sure to cover all of the steps above and have a well thought out plan to implement. This will help lead you to last success.


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