Home & Field Services · Seller readiness
Selling a Security & Alarm Systems business
Published · Reviewed by The Diligence Standard Team · Updated
An owner preparing to sell a Security & Alarm Systems business should document the operating drivers buyers will test, normalize the owner’s role and earnings, and surface capital, customer, people and transferability issues while there is still time to address them.
How the business works
Recurring monitoring revenue, attrition, installation gross margin and central-station/vendor relationships determine value.
Issues to resolve
- Subscriber churn can become buyer leverage if it is not documented, mitigated or priced before launch
- Monitoring-vendor dependence should be quantified before a buyer uses it to reframe value or terms
- Contract assignability needs a clear transfer, retention or mitigation plan before diligence begins
- The business-specific drivers of security & alarm systems value are not documented well enough for buyer diligence
- Owner labor and relationship dependence are not separated clearly from transferable enterprise earnings
- Missing or inconsistent operating evidence gives buyers avoidable negotiating leverage
Evidence to request and reconcile
- Subscriber roster/contracts
- Attrition cohorts
- Monitoring agreements
- Install job history
- Licenses
- Sales/lead data
Decision questions
- How many subscribers remain after 12/24 months?
- Are contracts assignable?
- What does it cost to create one new RMR dollar?
- Which technologies are becoming obsolete?
- Who owns commercial relationships?