SECURITY FINANCE ASSOCIATES.Business: Security alarms Location: Pasadena Pasadena (păs'ədē`nə). 1 City (1990 pop. 131,591), Los Angeles co., S Calif., at the base of the San Gabriel Mts.; inc. 1866. Revenue Growth: 1,533% IF the crime rate is so low, how can Security Finance Associates see its revenues grow 1,533 percent over the last three years? "Why do you think the crime rate is so low?" quips company President Tony Smith. Security Finance generates 75 percent of its revenues from brokering accounts. It buys alarm service accounts from small installation companies, bundles them, and resells those bundled accounts to larger alarm service companies, keeping a cut for itself. The practice, known as account aggregation Account aggregation is a method that involves compiling information from different accounts, which may include bank accounts, credit card accounts, investment accounts, and other consumer or business accounts, into a single place. , has sent fortunes soaring soaring: see flight; glider. soaring or gliding Sport of flying a glider or sailplane. The craft is towed behind a powered airplane to an altitude of about 2,000 ft (600 m) and then released. . In 1996, its first year in business, the company aggregated and sold 4,000 accounts for revenues of $577,000. In 1998, revenue grew to $9.4 million, and this year Smith projects revenues of $20 million on 18,000 accounts. Aggregating accounts has some benefits for everyone. Smaller companies, which make most of their money from installing alarm systems, use the cash they get from selling off service contracts to buy more alarm systems. Larger companies focus on the service side -- handling client calls and dispatching police when alarms go off. By purchasing existing accounts, larger companies can save on marketing and installation. A former CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of a cable TV company, Smith has been in the alarm industry since 1980. He is currently president of the California California (kăl'ĭfôr`nyə), most populous state in the United States, located in the Far West; bordered by Oregon (N), Nevada and, across the Colorado River, Arizona (E), Mexico (S), and the Pacific Ocean (W). Alarm Association and on the board of the National Burglar BURGLAR. One who commits a burglary. (q. v.) and Fire Alarm Association. Security Finance plans to fuel future growth by launching either a franchise or dealership network, through which it would recruit former insurance and real estate agents, retired police officers and others "with some marketing skills who want to be in sales but don't want to flip hamburgers," Smith said. The franchisees or dealers would then become an additional source of accounts that Security Finance could buy and resell re·sell tr.v. re·sold , re·sell·ing, re·sells 1. To sell again. 2. To sell (a product or service) to the public or to an end user, especially as an authorized dealer. . |
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