Security Rates


rrc1962

New member
I'm trying to come up with a formula for what to charge for security services. Most companies want to to pay their employees between $8.50 and $12.00 / hour. On top of that you have insurance costs, vehicle maintenance, etc. I'm tryinand g to figure out what a security company would charge on average for various services such as...

- Apartment complex patrol, say 5 visits per night.
- Standing post - Office building for instance.
- Concert/special event security.
- Hotel/Motel
- Executive protection

Those are some examples. Can anyone in the business suggest an easy way to calculate rates for a variety of services? I'm thinking along the lines of $XX/hour/guard then additional charges for patrol and special equipment needed. I don't want to grab a number out of the air without knowing what the industry averages are. I don't want to overprice, but I don't want to underprice either.
 

Don't forget to factor in liability insurance costs, licensing costs and whatever state-required certification costs that may be associated with a start-up security organization, and expected of by clients that want to know what they're paying for.

If you're going to provide armed security services, depending on where - I think you've also got to spring for all the legal pre-requisites to "clear" potential employees, and have them certified to carry on duty. Public trust background checks and Launtenberg act compliance to name a couple....

Just a suggestion, if I were attempting to launch a new security operation to compete with well-established and perhaps well-known agencies, I'd emphasize and stress VALUE, certifications and experience, and then pay a wage fair enough to not only attract quality guards, but afford you the luxury of screening out the riff-raff and employing only the best you can get.

In this economy, everyone and their friggin' cat thinks they can be a security guard - and sadly, in many outfits, anyone can. But most places and businesses are cutting ALL costs, so if you're planning to compete in this market, I'd stress value and quality through experience - and not necessary the "cheapest" service in town.

Just a thought.
 
I'm trying to come up with a formula for what to charge for security services. Most companies want to to pay their employees between $8.50 and $12.00 / hour. On top of that you have insurance costs, vehicle maintenance, etc. I'm tryinand g to figure out what a security company would charge on average for various services such as...

- Apartment complex patrol, say 5 visits per night.
- Standing post - Office building for instance.
- Concert/special event security.
- Hotel/Motel
- Executive protection

Those are some examples. Can anyone in the business suggest an easy way to calculate rates for a variety of services? I'm thinking along the lines of $XX/hour/guard then additional charges for patrol and special equipment needed. I don't want to grab a number out of the air without knowing what the industry averages are. I don't want to overprice, but I don't want to underprice either.

The rates will vary greatly depending on the type of services offered and the location you're at. Here in PRHI, I know of 2 companies that are currently billing $28.50 per hour per security officer working at a shopping complex. The security officers are paid anywhere between $9.00 and $11.00 per hour. This rate applies to security officers assigned to a fixed location.

For patrol assignments, the billing rate is $37.00 per hour. There is a 2 hour minimum on the patrol assignments. For a daily patrol scenario, the company negotiates individually with the clients. Average cost is $50 per night to the clients. This would include a minimum of 3 drive by/ drive through passes including the parking and perimeter of the businesses.

Concert or Special events are negotiated based on the length of time the security officers are required on site. The companies are pretty good at working within a promoter or event coordinator's budget. Rate of pay per security officer is $10.00 - $18.00 depending on the event and length of the assignment. Billing rate to the event promoter or coordinator is usually around $40.00 per hour or $150.00 per security officer per night.

Executive protection assignments vary greatly on the nature of the assignment, the client and number of personnel assigned to the detail. Last assignment I worked on, we were paid $1,000 per day. There were 3 of us on the detail, two of which were required to be awake at any given moment.

Best recommendation would be to call the different security companies in your area and request a price quote. Give them a couple of scenarios and see what they come up with. Keep in mind that there are various licensing requirements as well as other expenses such as medical, worker's compensation and liability insurance.

Hope I've been able to help answer your question.



gf
 

rrc1962

New member
Thanks guys....The plan at this point is to hire on a 1099, at least at first. That takes benefits and workers comp out of the mix. The downside is that I may have to require that each guard have their own liability. Addressing what AZSATT mentioned about selling quality and attracting better talent, this could be a good thing. Liability insurance isn't something that the run of the mill idiot will have. Those who do should offer a higher level of service quality.

My lawyer specializes in the security field. He's done a good job putting a client contract together. I also want him to get a subcontractor contract together. Hopefully that will help protect me in the event one of the subs screws up. Liability insurance is under control.

I also agree with selling the certs and experience. The business plan calls for military/police experience, current TN guard license, certified in chemical spray, taser, baton with training in handcuff techniques. Also CRP, AED and first aid certs.

Thanks for those number GF. That helps a lot. If I can get a few more responses like that I can get an idea of what others are charging in different parts of the country. We tried contacting one company. They wanted to come out and to an on-site evaluation, which is a good idea...unless the perspective client is just fishing for comp rates.
 
DOL Rates

I'm not sure about back in TN, but out here in AZ most pay rates are firmly established or based squarely on what the Dept of Labor determines to be the prevailing rate for a given field, rate and geographic area.

Our rates are DOL rates. Yuma, AZ rates are also DOL determined - and the DOL website is pretty specific and thorough.

I don't have the URL off the top of my head, but if you kick around on the DOL's page you can probably find what you need, based on ZIP codes, cities etc. Guard I and Guard II rates, the works.

Hope this helps too.
 
W

wolfhunter

Guest
I'm not sure about back in TN, but out here in AZ most pay rates are firmly established or based squarely on what the Dept of Labor determines to be the prevailing rate for a given field, rate and geographic area.

Our rates are DOL rates. Yuma, AZ rates are also DOL determined - and the DOL website is pretty specific and thorough.

I don't have the URL off the top of my head, but if you kick around on the DOL's page you can probably find what you need, based on ZIP codes, cities etc. Guard I and Guard II rates, the works.

Hope this helps too.

DOL's Bureau of Labor Statistics:
Wages by Area and Occupation
 
Thanks guys....The plan at this point is to hire on a 1099, at least at first. That takes benefits and workers comp out of the mix. The downside is that I may have to require that each guard have their own liability. Addressing what AZSATT mentioned about selling quality and attracting better talent, this could be a good thing. Liability insurance isn't something that the run of the mill idiot will have. Those who do should offer a higher level of service quality.

My lawyer specializes in the security field. He's done a good job putting a client contract together. I also want him to get a subcontractor contract together. Hopefully that will help protect me in the event one of the subs screws up. Liability insurance is under control.

I also agree with selling the certs and experience. The business plan calls for military/police experience, current TN guard license, certified in chemical spray, taser, baton with training in handcuff techniques. Also CRP, AED and first aid certs.

Thanks for those number GF. That helps a lot. If I can get a few more responses like that I can get an idea of what others are charging in different parts of the country. We tried contacting one company. They wanted to come out and to an on-site evaluation, which is a good idea...unless the perspective client is just fishing for comp rates.


Not sure if you'll be able to get away with the "1099" idea. Here in PRHI as well as a few other states, security officers are regulated, so they will have to be "employees" on the payroll.


gf
 
Wow......... bet you did not figure how in depth your answer could be....... Ok, here is the real short Operations Manager of a small security company answer. Figure out what the local Security Officer of that level will work for... not what the WANT to work for, but will work for, and mark it up by 1.5 percent to figure out your billing rate.

Liability insurance... it is not a choice, it is a necessity. Even if your client says you don't need it, you need it!I have been in the security industry for over 15 years... everything from Security Officer to Branch Manager and Director of Security for a Hedge fund, and the one thing that I learned is to never underestimate the stupidity of low pay security officers. You get what you pay for.

Now, you did mentioned insurance costs and vehicle maintenance. You need to include, training pay, vacation pay, holiday pay, uniform cost, unemployment, payroll cost, any medical insurance...... are you going to certify everyone or have them do it themselves?

Worst case is.... foot work. Walk around and find other locations that match the areas you are looking to bid. Then go up to the local security officer and play nice. Do the hey, I run a company, what do you make? I might be able to find something better for you..... or you can ask what they make and say you have a friend who is looking to get into the business.Then do the 1.5 markup and you should be in the ball park. The better the company and guard quality, the higher the mark up... (Most of the time but not all)
 

rrc1962

New member
You have to be licensed by the state, but you don't have to be an employee of a security company to get licensed or to work. There is nothing stopping me as an individual from working a weekend gig at a local concert on a 1099. If I get a request for something similar and want to hire someone for that gig, I should be able to pay him on a 1099.

I'll check it out, but I know a few guys who just bounce around to different jobs. Sometimes it's just cash. Sometimes the client want to issue a 1099. As long as the guards are state licensed, they are good.
 
You have to be licensed by the state, but you don't have to be an employee of a security company to get licensed or to work. There is nothing stopping me as an individual from working a weekend gig at a local concert on a 1099. If I get a request for something similar and want to hire someone for that gig, I should be able to pay him on a 1099.

I'll check it out, but I know a few guys who just bounce around to different jobs. Sometimes it's just cash. Sometimes the client want to issue a 1099. As long as the guards are state licensed, they are good.


I know companies here that hire "thugs", give them a black t-shirt with the word "security" stenciled in white and have them "play security" at special events, concerts, etc, then pay them CASH at the end of the night. Last time I checked, it was around $100 at the end of the night which works out to around $10 per hour. Kind of scary considering that the said "thugs" have no training, very little tact and often cause injury when ejecting people from the events or breaking up fights at the events. :eek:

I highly doubt that the people running these companies have any liability insurance. What really amazes me is that they haven't been sued yet, nor have the state regulatory agencies come around to break up their illegal operation.


gf
 

rrc1962

New member
Wow......... bet you did not figure how in depth your answer could be....... Ok, here is the real short Operations Manager of a small security company answer. Figure out what the local Security Officer of that level will work for... not what the WANT to work for, but will work for, and mark it up by 1.5 percent to figure out your billing rate.

Liability insurance... it is not a choice, it is a necessity. Even if your client says you don't need it, you need it!I have been in the security industry for over 15 years... everything from Security Officer to Branch Manager and Director of Security for a Hedge fund, and the one thing that I learned is to never underestimate the stupidity of low pay security officers. You get what you pay for.

Now, you did mentioned insurance costs and vehicle maintenance. You need to include, training pay, vacation pay, holiday pay, uniform cost, unemployment, payroll cost, any medical insurance...... are you going to certify everyone or have them do it themselves?

Worst case is.... foot work. Walk around and find other locations that match the areas you are looking to bid. Then go up to the local security officer and play nice. Do the hey, I run a company, what do you make? I might be able to find something better for you..... or you can ask what they make and say you have a friend who is looking to get into the business.Then do the 1.5 markup and you should be in the ball park. The better the company and guard quality, the higher the mark up... (Most of the time but not all)

Thanks Oram. Do you mean 1.5% or 1.5X. IE: $10/hour to the guard would be $15/hour to the client? Assuming he is a payrolled employee, that sounds a little light considering the costs involved with payroll employees. Different story for a 1099 sub who provides all of that on his own.

I know insurance is a must. I wish it were not. I'll probably work with a local instructor and put an in-house training program together that goes a little further than the basic state certification class.

I really, REALLY don't want to hire W2 employees, but if I get long term contracts, I may not have a choice. 1099 shouldn't be a problem for short term temp jobs.
 

rrc1962

New member
I know companies here that hire "thugs", give them a black t-shirt with the word "security" stenciled in white and have them "play security" at special events, concerts, etc, then pay them CASH at the end of the night. Last time I checked, it was around $100 at the end of the night which works out to around $10 per hour. Kind of scary considering that the said "thugs" have no training, very little tact and often cause injury when ejecting people from the events or breaking up fights at the events. :eek:

I highly doubt that the people running these companies have any liability insurance. What really amazes me is that they haven't been sued yet, nor have the state regulatory agencies come around to break up their illegal operation.


gf

That's kind of where I'd like to start, but I want to be above board with it. I want qualified people. At the bare minimum, to work legally in the business you have to be state certified, which is nothing more than a weekend class and a pretty thorough background check. That at least says the guy had some training and qualified at the range. You must qualify on any weapon you want to carry on duty.

Can you work as an independent guard in HI or do you have to work through an agency?
 
That's kind of where I'd like to start, but I want to be above board with it. I want qualified people. At the bare minimum, to work legally in the business you have to be state certified, which is nothing more than a weekend class and a pretty thorough background check. That at least says the guy had some training and qualified at the range. You must qualify on any weapon you want to carry on duty.

Can you work as an independent guard in HI or do you have to work through an agency?


As far as I know, there aren't any "independent" guards here in PRHI. There are "one man agencies", but no "freelance" guards.


gf
 

Steelhorse

New member
After working in the industry for years........

The payroll should meet between the industry standard of 50-66%, of the direct labor and admin costs.

Obviously, the lower the percentage, the higher the profit margin.
 

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