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McGraw-Hill has predicted that multifamily housing will rise 19 percent in dollars and 18 percent in units, continuing its moderate, upward trend. It doesn’t take a rocket scientist to see that fewer individuals can afford to buy a home and that the future outlook for home ownership does not seem any brighter. So, the steady increase in multifamily housing should hold over the next few years. With that news, you would expect professional contractors to focus on expanding this market sector to ensure continued growth in their electrical business.
Of course, you are not the only professional contractor trying to develop multifamily housing business. Nevertheless, there still are ways to increase your volume and your sales efficiencies while pursuing this market. One obvious way to augment business while reducing costs is to do more for the same customer.
Reviews of past Profile of the Electrical Contractor surveys continue to show growth with contractors installing more integrated systems. Using that simple approach in the multifamily residential market offers opportunities for larger contracts and reduced marketing and travel costs per project.
According to these surveys, in addition to traditional power work, more contractors perform work in voice/data, fiber optics, fire alarm, life safety systems, building automation systems, security systems and other low-voltage systems. To the point, these systems offer a significant integration opportunity.
The individuals who occupy residential units in multifamily buildings still demand and will pay for amenities normally found in single-family housing. For example, the multifamily-building owner needs to provide building security at an affordable cost to attract renters. Security systems may comprise access control, security cameras, special lighting and common area emergency communications networks.
To preserve the integrity of your bottom line, only perform installation work where you possess the knowledge of the code requirements and the capability to do the work efficiently. If you pursue such work, you have a jump-start in systems integration because most electrical professionals already install code-required fire alarm systems. Often, these fire alarm systems become tied into other life safety systems.
The most common systems that you may already integrate with a fire alarm system include fan control of the heating, ventilating and air conditioning (HVAC) system; fire and smoke damper actuation; operation of special hazard suppression systems; magnetic door hold-open release; automatic door unlocking systems; and building automation systems.
In some cases, you may only connect preinstalled controls to integrate these systems with the fire alarm system. However, you could become the installer and, thus, add to the size of your contract.
First, market your abilities to customers so they become aware that you offer a one-stop shop for these low-voltage systems. One key selling point for using your company rather than another low-voltage company comes from the fact that, by using you, the owner has more control over quality. The owner already has developed a level of comfort with your technicians and appreciates the quality services you provide. Depending on your jurisdiction, point out that other low-voltage companies may not be licensed as you are.
Many of my contractor friends have lamented that they lost lucrative low-voltage systems contracts because the customer did not know my friends performed anything other than power and fire alarm system installations. Don’t let this happen to you. Inform new customers that you can service all of their low-voltage systems needs.
And, of course, you need to seek out this work with your existing customer base because they may not know of your capabilities in this area. One of the typical roadblocks that you will encounter will include your possible lack of knowledge of other systems design, application and installation. Depending on how long you want to take to expand your entry into the rest of the low-voltage systems market, you can either research the training available for each system or simply seek out qualified sales people and technicians to help you obtain and perform the work.
So let’s assume you have an existing client where you have done both new installation work and ongoing electrical maintenance. Do they have any form of security system already installed? If so, you may ask that client to add those systems to your maintenance contract. And doing so gives you the opportunity to better understand your customer’s systems needs and learn more about the security system installation and operation.
Security systems and video camera installations offer you additional work that you can perform quite easily once you either obtain the necessary training or hire qualified personnel, which will enable you to jump-start the work. Additionally, the new 2013 edition of NFPA 72, the National Fire Alarm and Signaling Code, allows security systems to integrate with fire alarm systems, offering more justification for why you have the most qualifications to provide their security systems installations and maintenance.
NFPA 72 also permits the integration of mass notification systems (MNSs) with fire alarm systems. Again, it increases your opportunities to expand your business. You can use NFPA 72 2013 as a roadmap to developing your marketing plan for your services.
You can find a number of sources to obtain training for security systems installations, but the first logical step involves choosing a reputable manufacturer who offers both equipment and system installation training. The same holds true for video camera installations. You should also take note of a relatively new NFPA 731 2011, Standard for the Installation of Electronic Premises Security Systems, which you can use as a reference to ensure you follow the latest minimum application and installation requirements for these systems.
In addition, NFPA 730 2011, Guide for Premises Security, will help you to understand the correct application of security concepts. It describes construction, protection, occupancy features and practices intended to reduce security vulnerabilities to life and property, and it provides the criteria for the selection of a security program to reduce vulnerabilities.
Your security systems installations should begin small, perhaps with building access control, but if you choose to jump in with both feet, review NFPA 730 2011 thoroughly, along with some of the security system application references the document provides.
Many avenues exist that will enable you to pursue systems integration opportunities in the multifamily residential market, but it will take a focused effort. Obviously, systems integration also provides for larger sales and profits from the same customers to whom you would normally only sell power and fire alarm system installations. Selling more systems to the same customer reduces your cost of sales and increases your profits.
Finally, if you are not yet convinced that you should enter the expanded low-voltage systems market, keep in mind that owners of existing buildings often install security systems and MNSs, providing you with more opportunities to expand your customer base.
MOORE, a licensed fire protection engineer, frequent speaker and an expert in the life safety field, is a past chair of the NFPA 72 Technical Correlating Committee. Moore is a principal with Hughes Associates Inc. at the Warwick, R.I., office. He can be reached at [email protected].