Whether you’re a sole trader, a start up company in Australia, a DBA (A Doing Business As) or start up company in the USA, we all need to navigate our way through the business minefield, irrespective if you’re setting up a security business or another service. This can be a daunting task, especially as a large majority of Security and Risk Management Firms or Companies are established by security operatives/agents/personnel/staff, who have had little to no business experience in the past. It’s one thing to have the technical know-how and the ability to provide an excellent security service or product, its an entirely different matter establishing and running a successful security business. Certainly this is true in my case and that or our colleagues at Op Structure in the USA.
So rather than hoard all the secrets and have you all make the same mistakes, Steve Albritton of Op Structure and myself (Troy Claydon) from Panoptic Solutions decided to share our experiences in the Wheels Up Podcast about how to establish a security business and firm, discuss the set up options you might have, outline some of the mistakes we have made and we provide several tips to help you succeed. Not everyone’s journey is the same, and not everyone will make the same mistakes, but if this article and podcast can provide you with at least one tip or one pitfall to avoid then it’s been worth reading/listening to.
1. Security Business Plan
Before you do anything draft a business plan. Decide the type of security business and services you wish to provide ie: mobile patrols, risk consulting, guarding, corporate, close personal protection, cash in transit – the list goes on. Work out what you want to provide because it’s not always a case of one size fits all. Is it feasible, is there a need? What makes you different? Draft a SWOT analysis – What are your Strengths, Weaknesses, Opportunities and Threats. What capital do you need? What are the ongoing costs. All these need to be included in your business plan. There are many free templates and guides on the web, this Start Up Guide is an older one produced by John Petty of the University of Technology in Sydney, but still very relevant and very easy to follow.
2. Setting Up Your Business
Sole trader (DBA) vs Incorporated Company (Pty Ltd/LLC) – Talk with an accountant or commercial lawyer/attorney and decide which option is best for you. Your business plan/model will guide your decision here.
3. Budget, Forecast & Cash Flow
It’s important to talk with a qualified and trusted financial professional in business. Realistically you will include a budget in your initial business plan, but it doesn’t stop there. You will forever be doing this. Build a budget and try to stick to it. As you start trading you will get a better idea on how to forecast. Be aware that as a business you will have to front of with money on most occasions. Don’t be that guy or company that feeds the line – “I haven’t been paid by our client so you have to wait till I do”. It’s your responsibility to pay your team. You can always have arrangements in place with certain suppliers and providers, which will help with cash flow, but don’t make your team members wait unless you have a prearranged agreement in place. You may have to wait a considerable amount of time before your client pays you, so make sure you can float your operations.
4. Licences and Insurances
Investigate what you need. Each country is slightly different and often each state within those countries differ. Don’t skimp on insurance.
5. Office with a view
It’s great to build your empire, but be realistic about whether you need that corner office on Wall street. So many businesses these days are mobile. Yes it’s great to have an office to meet clients and have a secure HQ to operate out of, but the reality is, you can save money and be just as productive working from home until you get to the point where you are big enough to have an office. This said, obtain a PO Box or engage the services of a Virtual office. Dont post your home address, both for professional appearances and most importantly for security reasons.
Find one, or two or three. A mentor does not need to be there to hold your hand. They can simply be someone who has been in the industry for some time who you can look to for advice or support. Which leads to the next point…
Networking is massive. But be aware there is a difference between networking and being a leech. Networking means introducing yourself to other industry professionals and helping out where you can. It often means sacrificing without want. It’s about building your reputation and your brand. There’s no easy way of doing this and it will take time. Attend networking meetings in your local area, meet other professionals for coffee when it’s suits them, work in with their schedule, attend functions or seminars, join professionally recognised organisations such as ASIS International, Protective Security Council, IPSA UK , ASIAL , ATAP, SPAAL or the International Protective Security Board . Be prepared to give a lot to networking.
8. Run Your Own Race
Its human nature to compare and worry about what we’re missing out on, but, by concentrating on the other person, the other security business or the competition you stop focusing on your own product. It’s always good to know what other companies are doing, but don’t compare against them. You will always find a shortfall irrespective of how well you are doing. Concentrate on what you are doing and do it to the best of your ability. This will build your reputation and brand.
Where do I start…there are so many platforms now to get your message out there, which basically means that there are multiple platforms for marketers to take your money. Website, Social Media, Print Media, Direct Marketing, SEO, PPC, Newsletters, Postcards, Gifts, Skywriting, Buses, Taxis, Radio, TV, and on and on and on it goes…Everyone’s an expert and everyone will tell you their way is the only way and the best way… Save your money. Start small, allocate a budget and stick to it. Yes you do need marketing, you MUST have marketing, but it doesn’t need to cost the earth. Lean on contacts you have – can the design your logo? Do they know how to steer social media? If so ask. Utilise sites like fiver, Upworks or freelancer to find a freelance designer, marketer, video producer, SEO or content writer etc etc who may be within your budget. A word of warning though – the search can sometimes be a long one and you really need to read reviews before commiting. The worst they can say is no. Also, marking isn’t just online, can you attend seminars? Are you confident speaking about a particular subject? If so ask to be a speaker at an upcoming event. Join LinkedIn, follow industry professionals and contribute to the landscape, be a participant not just an observer – be creative. Marketing can be an expensive black hole so ease into it and don’t over commit.
10. Rewards Programs
Join them…Join them all. That said try to pick one airline and fly them as much as you can. It’s not always viable which is why you should join as many as you can. Points accumulate faster than you would have thought. Car rentals, airlines, credit cards etc. Obviously take into account the financial consideration that goes into earning these points.
11. Business Ethics 101…
Last, but by no means least, be ethical in the way you conduct yourself. Sure be competative, but, do so on quality. There’s always going to be someone who can do things cheaper, but that doesnt mean better…in fact it usually means the opposite. Treat people the way you want to be treated, from client to the the driver, the static guard and yes even your competitor. You dont have to like everyone, but you can be respectful. Don’t build your business on lies. Remember, reputation is everything.
Remember in all of this, your business is scalable. Be enthusiastic, be a go getter, be proactive, but don’t go too hard too fast. According to the US Bureau of Labor Statistics: about 20% of businesses fail in their first year, and about 50% of small businesses fail in their fifth year. Further, according to a report by the Australian Bureau of Statistics, Looking at the survival of businesses (micro to large) over a four year period, of the 2.1 million firms in business in June 2011, only 1.3 million or 62 per cent were still in business in 2015. Take your time, build your reputation and your brand. Word of mouth is key. Clients will come. Business is a marathon, not a sprint!
If you are after any guidance or would like some advice about establishing a security business in the USA you can reach Steve Albritton of OpStructure in the USA via Steves LinkedIn account, or …
If you would like any advice or have any questions about setting up a security business in Australia or even Indonesia for that matter, you can contact me, Troy Claydon via my LinkedIn account.
We won’t give you everything on a silver platter and we won’t do all the work for you, but we are happy to guide you as you navigate your way through hurdles or connect you with the right people.
Learn more about security services in Australia, Indonesia, and the Indo-Pacific region via Panoptic Solutions website
Learn more about security and risk management services out of the US and beyond via OpStructure website.
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