Circle the wagons. Control the controllables. Batten down the hatches. Whichever catchphrase resonates with you, it’s what savvy business leaders do when they sense an economic downturn on the horizon.
The contract security guard industry is not immune to the effects of a recession, in fact its impact might be more acute. When a recession hits, business owners reevaluate their priorities, separating luxuries from necessities and focusing on their most valuable services and customers. Contract security firm owners must do the same because all too often, businesses view security guard services as a luxury that can be cut.
It’s one thing to lower expenses, postpose acquisitions, or outright cancel a service to improve cash flow. Equally important are actions you can take to shore up the business, streamline operations, and build relationships to survive and even thrive during an economic downturn. Here are some activities that smart business leaders do during a recession:
Improved Business Acumen Improves Your Chances of Survival
Strategic Business Planning
Don’t wait for the phone to ring. Perform a market analysis to identify the more resilient businesses in your area such as construction sites, schools, auto dealerships, marijuana dispensaries, banks, jewelry stores, and upscale residential communities that are more likely to retain security services during a recession.
Reach out. Take the offensive. If they currently have a security guard provider, are they being served to their satisfaction? Can you adapt or price your services to better meet their needs?
What events are on the calendar this quarter? Next quarter? Is there a concert, golf tournament, convention, big game, or state fair coming up to even out the peaks and valleys? Do you have the workforce lined up to adequately staff these events without paying overtime?
Analyze your current client roll
How many clients would you classify as being vulnerable to cutting back security services, and how many do you think are positioned to ride out the storm without much impact? If you have a lot of small clients teetering on the edge of survival, it’s time to start looking elsewhere for new accounts.
What new markets are evolving?
Is there a large residential community or commercial property under development in your market requiring contract security services during construction or after occupancy?
Election integrity is a new vertical for security. Investigate the election cycle in your state. Recent political volatility has seen many election officials and ballot processing facilities across the country seek out security services due to threats of personal harm aimed at election officials. Ensure your team is available and up to the task to help provide safety and security.
Knowing what level of dip in cash flow is acceptable during a slow month and how long your cash reserve will last is critical. Have financing or a line of credit set up behind you to bridge the gap and meet expenses in the event a client pays late or not at all.
To minimize the chances of that occurring, leverage HR and payroll software to send accurate, timely client invoices and issue employee paychecks on time.
Security is a people-centric business, and your officers are your firm’s most valuable asset. Keeping guards happy, informed, and trained improves employee retention and in turn the quality of service your firm provides.
Security workforce management software can enhance communications with your team and streamline operations by avoiding scheduling errors and digitizing previously manual processes and procedures such as incident reporting and checkpoint tour status. Invest in the tools your supervisors need to efficiently manage their teams.
Understand how clients perceive your business and brand. Talk to your customers directly every few months, or at least conduct surveys periodically to gather input; don’t rely solely on feedback from officers posted to the site. They didn’t sign the contract, you did. Ask about what can be improved, or if their needs will change during a recession.
Make sure your guards are living up to expectations and meeting the contractual obligations as outlined. Suggest and commit to mutually-agreed upon key performance indicators (KPIs) to measure the performance and efficiency of the services you provide and keep your word.
Understand your audiences, how to segment them, and how to reach them. The recruiting message to security guard candidates is very different from the quality of service/protection message to potential clients. Use social media channels (LinkedIn, Facebook, TikTok, etc.) to target groups of employees about starting an exciting new career in security, and use your website, email blasts, and community forums to promote your services to customers.
Connect with other guard firms in your market. Are there large events requiring the services of multiple security vendors? Team up. Get connected with potential customers in the community through business networking groups, chambers of commerce, and local law enforcement to keep pace with trends and make your name synonymous with security services in your community.
Make the message relevant.
During a recession the knee jerk response is to duck and cover. But when it comes to security a recession is exactly NOT the time to cut back. This is when people get desperate, when frustration mounts, when crime escalates.
Your message should be that this is the time to double down on security, enhancing defenses to protect people and business assets from growing threats. A recession is not the time to leave your business vulnerable to crime.
Control the Controllable’s
Security firm leaders that build flexibility into their business goals, services, and financial objectives while being sensitive to the needs of customers equally affected by a recession will find themselves in a better position to successfully steer their company through an economic downturn.
Our team offers a number of security workforce management solutions designed to enhance the efficiency of your operations and insulate your firm against the effects of a recession.