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6 Metrics That Make a Difference in Your Security Guard Business Management

By Mark Folmer, CPP, MSyI

Performance is being measured with ever finer accuracy. The security guard business is no exception.

There is not a lot of wiggle room for security guard business management.

Errors can have severe consequences and margins are tight. Furthermore, the companies are pushed to offer multiple solutions in order to answer the call of duty, deliver better service, and compete with others.

So to be profitable and perform efficiently, focusing on metrics is essential.

security guard business management

What are metrics exactly?

According to, “a business metric is a quantifiable measure that is used to track and assess the status of a specific business process.”


Here are 6 key metrics you should keep an eye on:

(By the way, if you are looking for performance to measure in your mobile business, have a look at this article)

1. HPW

Hours Per Week, back in the day, was the ultimate metric. Today, it is worth watching as a volume indicator, i.e., is your business growing or shrinking?
Keep in mind, though, that HPW tells you nothing about profitability, so a bigger number can actually be costing you money!

2. Gross Margin

The best way to measure account profitability is via gross margin, also known as direct profit.
Essentially, you must be able to break down all costs relating to an account in order to understand which accounts are actually profitable. (Hint: not all of them are!) These costs include uniforms, overtime, equipment, site training, etc.

3. Net Margin

Once you have established your direct margin, you need to take it a step further: Understand how shared services, like supervision, management, back office, compliance, and other departments, all fit in.
Are you running too rich? Is everyone overworked and you can afford to add some staff? Net margin will help you answer those questions.

4. Turnover

Turnover impacts the bottom line — good as well as bad turnover. You need to know how many people are leaving and why.
If it is true that security guard companies often recruit from the same place, then why does the rate of turnover vary among companies? Be sure you understand the root cause of your talent retention (oh, and read this article to learn why attracting top talent is critical).

5. Overtime

Know your Overtime (OT) number, ideally, in a few formats: (1) as an overall cost per hour, (2) by account, and (3) by employee.
Many factors contribute to OT: client requests, complexity, turnover, etc. Understand what is driving yours. Also, be clear on the difference between Billable and Unbillable OT. Discuss that concept with your clients.

6. Budgets

Budgets may seem elementary, but, hey, sometimes everything needs to be said. You need to budget across multiple aspects of your business. Budget expenses and revenue and compare your actual performance versus budgets.


Bonus: Quality Assurance!

How are you ensuring that onsite services are being delivered as they are supposed to be, i.e., the way they are described in your service level agreement. While we are at it, how are you measuring your client’s satisfaction? These two metrics are absolutely related!


incident report for security guard business managementDouble Bonus: Security Incidents

You should have a good understanding of how many incidents you and your team respond to. While the number of incidents is not a good metric because you have no control over incidents occurring, the number you properly respond to is a good one to know. For example, if out of 100 incidents, you respond to 99 according to protocol, you are 99% efficient or accurate.

Good carpenters, it is said, measure twice and cut once. As a security guard business owner, you should measure certain key metrics and run your business based on performance against those metrics. After all, you can only understand and improve what you measure.


Run or a security guard company and have other ones to suggest or are you an end user and have others to suggest?
Then please feel free to share them with me via [email protected]!


Mark Folmer, CPP
Vice President, Security Industry
[email protected]
Twitter: @markfolmer

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