Niche Marketing

Residential Access Control

As institutions with housing units and the general public become more concerned about security, there’s a growing interest in residential access control and entry systems. Universities are adding access control systems that call for students and others to use a card to gain entry into buildings—cards that also can be used to turn on services—e.g., air conditioning, lights, heat—once the person is inside. Many condominiums now have card access systems. Telephone entry systems are being added to many individual homes, and video is being added to many home alarm systems. Some low-voltage contractors are garnering a piece of the growing market for access control and entry systems for condominiums and in institutional residences by employing a few different strategies. And some electrical contractors can benefit from the growth by working in conjunction with other companies.

However, carving out a niche in the market has its challenges. Manufacturers sell their products through distributors, and they usually require installation by certified personnel. Viking Electronics, Hudson, Wis., a company that has predominantly been commercial, but has recently entered the residential market with its E-40 and E-50 series telephone entry systems, is one example.

“Telephone installers from telephone companies usually install our products, but low-voltage contractors are starting to install them as well,” said Carol Lieb, marketing, Viking Electronics.

In addition, many manufacturers have relationships with companies in certain geographic areas, and only those companies can perform any installation of their products. That means that contractors who don’t have that relationship might not be able to bid competitively if a bid specifies the product.

Walton Electric Corp., Glendora, Calif., has faced that problem. “On one bid we could only get the product from two or three companies in our area, and they had to install it,” said Don Nelson, vice president, Walton Electric Corp. “When I heard the price they were charging, all I thought was that I could have done the job for half the price.”

Walton Electric decided to do its own low-voltage work and include access control systems in the package.

“If we’re picked to do the fire alarm, TV, telephone, we almost always get the access system, a telephone entry system for the visitor and a card entry system for the tenant,” Nelson said.

Walton Electric now buys products made by Mircom, Toronto, a company that manufactures a line of communication and entry products and has invested in having its employees trained to install Mircom products.

“We do a lot of government housing, and we usually do it as design/build, so we can specify our product,” Nelson said. “We use their access control for the tenant and telephone entry system that connects with the telephone line so that a visitor using the phone entry calls the telephone of the tenant, which means we don’t have to provide a separate conduit and wire system.”

Doing its own low-voltage work also works in Walton Electric’s favor in other ways.

“All the low-voltage systems are critical at the end of the project, so if the access control and telephone entry systems go to another subcontractor, it can be like pulling teeth to get them to perform within the time frame,” Nelson said. “Because we do it in-house, we can do the rough work and design as we are doing the project. We control the work and the schedule as opposed to trying to get someone else to feel the pressure we feel. Our fate is not controlled by someone who has no interest in our company.”

But this is not necessarily a new approach. Electrical contractors entering this market often try to establish relationships with manufacturers.

“Contractors tend to choose one or two manufacturers whose products are most suitable to their clients,” said Don Davis, executive director, Electrical Training Institute of Southern California, an organization that provides training for sound and telecommunications apprentices and journeymen in the principles and proper wiring of access entry systems.

“We train our apprentices and journeymen in the general operation and wiring of the systems,” Davis said. “Manufacturers provide training in the specific aspects of their products. It’s an investment of time and money to have your employees trained in the specifics of a manufacturer’s product, and it would be both expensive and difficult to set up your company to provide service in all of the products on the market. Contractors usually try to establish their own niche.”

Another related issue particularly affects the contractor. “You want to try to save on the learning curve,” Nelson said. “You want your employees to be experts and not be constantly finding out the best way to work with a product. It would be prohibitive to have your employees trained in every product.”

Options for competition

Within the constraints of the marketplace, contractors who want to compete have two options.

“You need employees who are trained in installation,” Davis said, “so you have to either hire people who are knowledgeable or have your employees trained.”

Titan Integrated Systems Inc., North Long Beach, Calif., a low-voltage electrical contractor, chose the strategy of hiring someone with expertise in its efforts to enter the market.

“Titan is very narrowly focused on schools and hospitals, so we’re trying to diversify into other areas,” said John Conner, vice president, Titan Integrated Systems. “Everyone is interested in door access control, which happens to be a growth area.”

Titan Integrated Systems hired Jay Mendoza as a consultant who is certified to install various products. He previously managed installation of different access control, telephone and automobile entry systems at a new Southern California housing development that will eventually include 3,246 residential units, ranging from lofts to townhomes and condominiums to single detached homes. Mendoza, now working exclusively for Titan Integrated Systems, brings specific valuable knowledge about products and homeowner preferences to the company.

“Systems with varying levels of security were installed in the different types of units,” Mendoza said. “Condominiums were installed with systems that use a key fob or card for entry for resident access, but they weren’t the high security type that track entry and exit. Residents in the townhouses didn’t want card entry but opted for telephone entry systems. We implemented an automobile entry system that senses when a car with a certain device is nearing the building with no required action by the driver. There’s a whole variety of systems at the complex.”

To create a market for Titan Integrated Systems, Mendoza is using his knowledge when meeting with customers. He assesses their needs and puts proposals together to meet those needs.

“We are attempting now to get prequalified with some of the builders so that when they go after a big condo project, we can bid the job,” said Conner, adding that his company usually works on projects as a subcontractor to electrical contractors.

Titan Integrated Systems has arrangements with some distributors and manufacturers to buy and install equipment, including systems by Linear LLC and Doorking.

“I favor the Linear phone entry system—AE2 or AE1000—and for buildings that require high security, I integrate that into Honeywell N1000-4, which is more for commercial use,” Mendoza said.

Parts and smarts

For smaller systems, Titan uses International Electronics Inc. “They have peripherals, and we add to that system to create a card access control system if it’s only the front door and the gate in the back. It doesn’t provide for any monitoring of who goes in and out, only access. The card can be disarmed if lost and is more for security than monitoring,” Mendoza said.

For the telephone entry system, Titan favors entry systems by Viking and Door Phone.

In spite of the size and limitations of the market, there is a way for electrical contractors to benefit from the growth of the residential access control market without hiring, training or initiating low-voltage divisions. They can participate, according to Nelson, in a method dubbed “Parts & Smarts.” That is a scenario in which the electrical contractor provides the conduit, wire and power—the “Parts”—and the access control and entry system dealer puts in the final parts and does the final programming—the “Smarts.” That method was used at Rensselaer Polytechnic Institute in Troy, N.Y., when it came time to upgrade the security system at the residence halls by installation of card access control systems.

“I hire electrical contractors to install the cable pathways for the card access system, which might include surface raceway, conduit, cable tray and the like,” said Scott Herkenham, electrical designer/project manager, Rensselaer Polytechnic Institute. “Since a lot of the security companies charge an arm and a leg for their labor rate, there’s no need to pay twice as much for those guys to install conduit and cabling when I can have an electrical contractor do it for half their price ... . After the electrical contractor does their work, the security company installs their components and makes the cable terminations,” he said.

Best Access Systems, a division of Stanley Security Solutions, Indianapolis, Ind., is the system Herkenham used. The institute provided the students with photo ID badges, which give them access to certain buildings.

“If you’re able to lock up work with universities who are upgrading campuses by installing access control systems in dorms and other buildings, it can be a very lucrative market.” Nelson said.

Contractors can also establish a niche in an already competitive market by gaining expertise with certain products.

“It’s difficult and expensive for contractors to break into a niche established by another company,” Davis said. “But if they establish a certain niche, they can be the ones with the competitive advantage, which is good for both the contractor and consumer alike.”  EC

, author of “Kids Inventing! A Handbook for Young Inventors” and “Women Invent! Two Centuries of Discoveries that have Changed Our World,” can be reached at or




About the Author

Susan Casey

Freelance Writer
Susan Casey, author of "Women Heroes of the American Revolution," "Kids Inventing! A Handbook for Young Inventors," and "Women Invent! Two Centuries of Discoveries that have Changed Our World," can be reached at or www.susancaseybooks...

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