There are certain dilemmas that small, medium, and large companies face. A small company can keep their nose to the grindstone, be nimble and versatile. Usually as you’re building up a business you’re willing to investigate anything in your adjacent field to see if there is a niche market you can fill. A lot of dealers have custom skill sets that were developed to satisfy client needs, especially because the low-voltage industry has diversified.

What should your low voltage company be in today’s market? You can cherry-pick some of your core profit centers and you could then venture into other areas and total solutions that many businesses and high-end residential clients are looking for.

We’re not in the alarm business anymore. We’re in the low-voltage solutions business. Picture a big funnel and at the very bottom of the funnel are the client’s desires and the dollars they’re willing to spend. At the top of the funnel are high-end integrators who refer to themselves as all-in-one solutions. That is your highest dollar yield. It’s also the most effort, time, and coordination. You absolutely have to appear to be at the very top of your game regarding any tangent in the low-voltage world. It’s clouded with a certain level of mystique, because clients may part with over a half-million dollars to automate their homes.

Visualize the top of the funnel, where you’re putting in all types of ingredients – smart controllers, plasma TVs, infrastructure wiring, telephone systems, cameras, and the lonely little alarm system. Somewhere in that funnel is a bottleneck. That’s where your core skill sets start to leave off, depending on whether you’re a top-down selling company or you’re starting at the bottom of the funnel with an alarm system, trying to sell up. You will reach that choke point wherever it may be, because very few companies possess the entire range of low-voltage skill sets.

We all know that clients expect alarms to be insignificant amounts of money, and you’re like a salmon swimming upstream as you try to upsell your clients from a basic alarm. The problem is you don’t have the expertise and the years of experience in some of the newest consumer whiz-bang technologies. This is if you’re at the bottom of the low-voltage funnel.

The clients’ interests – whether they can afford it or not – are in the top down. So the small company’s dilemma is: Do you diversify and swim upstream in this funnel and start to capture other marketplaces just so the client considers you for a guaranteed alarm sale, which is the RMR business? The answer is that the consumer market is demanding it.

Normally what happens is you’re swimming upstream and cherry-picking what seems to fit your marketplace. You certainly have the client’s ear because you’re their trusted security provider. Being an existing client, you have the floor to sales pitch them on anything and everything you think they might be interested in. The clients are nodding because it all sounds good and exciting, and as you start to talk considerable dollars, as you approach your choke point, out of the blue the client may say, “What about an entire home theater, with the theater seats and a Star Wars theme?” All of a sudden you find yourself speechless. What do you say? “We have people we are affiliated with who can do that for you.” You just shot yourself in the foot! Now you put your entire job at risk, because without prior notice, the client has upsold themselves to a top-down solution.

You may easily lose not only all you’ve been talking about, but it will be a lateral pass to the company equipped to handle this client and they may not be including you in the alarm portion.

You really thought you were doing great until you hit that block point, and now a top-down company comes in and compresses you right back down to where you were – to the lonely RMR alarm company. Although their bottleneck is at the bottom of the funnel, they can easily navigate their way through this bottleneck, either because they’ve subcontracted the alarm or installed it illegally themselves (if they are operating without an alarm contractor's license in a state that requires one) – because their client has been sold from the top down.

My advice is try to assign recurring revenue to whatever type of system you do. It doesn’t mean you have to give a bumper-to-bumper warranty on every consumer product. Maybe it’s an extended warranty on the wiring for 15 years. If you assign that value to your services, then you will be able to train your way up to the next plateau, because you can afford it.