Question about buying alarm accounts

There not worth 10 cents a piece if they have not been properly installed and maintained and people do not renew there contracts becuase of this you ended up buying a whole lot of nothing, last i heard on new contracts they were paying 25 times RMR if it was an outright purchase and the people buying owned there own central station if you have to use a 3rd party monitoring then you also have to figure these costs as well . some one so willing todump towards end of there contracts i would be very leary with out proper due dilligence and research on what your buying.

Going rate is 2.5 times annual revenue. 15% hold-back. Make sure you're no buying a "pig-in-a-poke". One company here (Vancouver) sold their accounts and the outfit that bought them very quickly found out that most of the accounts were "barter" (no cash involved).

Be really really rweally careful - if they're junk installs, or slow pays, you're buying a headache.

100 accounts is not very many for a "jumpstart"...you could easily do that in 6 months with a couple of installers on your own. Besides it aint much of a monthly income after you pay monitoring and billing costs and taxes.

true its not much but i'll be starting on my own

100 accounts could give me a good start by at least paying for my store rent or part of it but the technical aspect I got warned about already.. and it makes sense, it could be alll junk

Stephane, I suggest you be very careful about buying accounts from just anyone, especially the very small dealers. There's a lot you have to do upfront before you even try to determine a fair market price for them. A few thoughts below:

1- You might want to be shown the customer records and some relevant information showing the cash flow coming into the business. Do an analysis to see what revenue stream you can realistically expect from them. 2- What is the sellers reputation in the industry re quality of installs, customer service, time in business etc. 3- How many different makes and models of panels in his customer base, and are they all on line currently 4- Is he doing his own billing or subbing it out. How big a problem are "non payment" accounts. How many does he currently have that are not fully paid up to date. 5- What is his current attrition rate versus the industry norm. 6- What does his current monitoring station say about this dealer (off the record...) 7- Did he install these panels himself or sub them out. 8- What assurances do you have that his clients will be happy to swing over to you ? How does this client plan to advise these clients of his company sale (or does he at all...?) 9- What length of term contract applies to these customers ? (but don't depend too much on that; if they are unhappy, and choose to leave for other reasons, you will likely be able to do nothing short of suing in small claims court......)

There are a few dealers around town here that have approached me to sell me their accounts. I wouldn't touch them with a ten foot pole ! And there are others who's accounts would be as good as gold in the bank !

In our business it is "buyer beware" (for both end user and account buyer alike...).

RHC

I choose Polesoft Lockspam to fight spam, and you?

Well if you got the cash and are not borrowing money to buy the accounts..maybe it would make a little sense. Personally, I wouldn't do it -16 bucks is not much rmr after expenses. You'll probably lose 10-20 during the transition too, so your monthly may be 1300 - expenses.

| > 100 accounts is not very many for a "jumpstart"...you could easily do that | > in 6 months with a couple of installers on your own. Besides it aint much | of | > a monthly income after you pay monitoring and billing costs and taxes. | >

| >

| >

| >

| >

| | |

Oh nooooooooooo, you had to go there, didn't ya........

Hey, don't sweat it !! Anonymous posters (like anonymous posts) are worthless.

Besides, Paul has the Loxxon product totally wrapped up worldwide......(with tin foil I think).....:))

RHC

I choose Polesoft Lockspam to fight spam, and you?

It's Tom Fowler, dummy. js

NO I'm Tom

It's your accent. Y'all talk funny. js

Really?

Hmmmm!

Of course it matters Jim; I never said it didn't (your sarcasm notwithstanding). However, it is not the be all and end all you assume. And consumers are still well advised to shop for the shortest contract possible as being the best thing (from their perspective...)

A long term contract probably matters somewhat more to a conservative minded bank should you wish to borry against the equity, than it does to a buyer, since the quality of the company / accounts in question is just as important if not more so to the buyer (he has to live with them and service them) ! We have a guy here in town we call "Jimmy the sleaze" ! No one will touch his accounts; we even check them out beforehand before agreeing to take them over. Buying his accounts at any price would be a disaster !! I have no idea what he will do when he decides to leave the business (hopefully sooner rather than later...)

Any company with a good reputation in the industry should have no trouble selling their accounts to the RIGHT BUYER. Speaking from personal experience with the two companies that I have dealt with, they seem to be just as interested in how much work it will be to swing the account (once they've determined they value your accounts for purchase at all). The actual monthly dollar amount counts for far more, since any price determined is ultimately based on the revenue stream. In our area, ALL OTHER THINGS BEING EQUAL, monthly, one or three year terms all bring about 30 times monthly. It may or may not be different in other areas. And clawbacks due to attrition can also make a significant difference in the actual end value.

It would be interesting to be able to see some formal publications on this issue of buying and selling accounts, since most of us will one day be in that position.

RHC

I choose Polesoft Lockspam to fight spam, and you?

The f****ng day you hear me say Y'all. You'd have a better chance hearing Doug properly pronounce herbs, or Mark describing an exciting event in the world of adult tricycling.

T> > Who blew my cover? :-)

Yup, it's Tom all right. js