Aloha Alarm flourishing in Hawaii

The small new company is adding customers and employees and says quality service distinguishes it from big summer-model rivals
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Wednesday, April 25, 2012

AIEA, Hawaii—Aloha Alarm just launched in January, but already has about 200 customers and is gaining more at the rate of about 50 a month, according to Aloha president Mark Plischke. He said he also plans to add six more employees to his current staff of 14 before year’s end.

Plischke said the secret to his small company’s success in the competitive Hawaii market—which has been discovered by summer-sales-model companies in recent years—is offering quality service to customers.

“I think what makes us different from other companies is the idea of doing a good job,” he told Security Systems News. “All I want to do is provide good quality service and the rest will fall into place.”

Plischke said he also offer his installers and sales reps the incentive of residual income off the company’s RMR. “Everybody gets a piece of that monthly bill, every time a customer pays their bill,” he said. “[The employees] really like that because it’s a way to build up the future for your family.”

Aloha uses a number of different marketing approaches, he said, “but the primary one is good old knock-on-the-door, sell them an alarm, and then get referrals.” The company’s business is about 70 percent residential, and the rest commercial, he said.

Aloha Alarm was born after Plischke recently left another company, APN Alarm Systems of Hawaii, which he and a partner started in 1996. Plischke said he was operations manager and junior partner. “We had a little shy of 3,000 accounts and were pushing $100,000 a month in RMR,” he said.

APN had always kept its accounts in house but Plischke said his partner decided to sell the accounts to a mainland company last year. Plischke took his share of the sale proceeds, along with 50 accounts, and launched Aloha. He said that 11 of APN’s 18 employees followed him—five sales reps, four installers and two experienced office staff members.

“So it was a real easy transition,” Plischke said. The company actually got its license last August but its grand opening was Jan. 2 of this year, he said in an April 23 interview.

Hawaii doesn’t have a lot of violent crime, but home burglaries are common, he said. “It does make burglar alarms really effective here,” Plischke said.

However, he said, “one of the biggest changes in the marketplace is that we’ve been hit really hard by the summer sales programs.” He said those big mainland companies have inundated the market with systems that cost little or no money down.

Five years ago, he said, an average residential install cost $2,000 and monthly fees were $25. Today, he said, “the average sale is maybe  $299 (installation) with $50 a month, so we’re going in losing investment on each install and then we make it back though the term. So generally, that really locks out a lot of small companies because you’ve got to have quite a bit of capital to be able to do that the first two years in before you start getting a payback for your investment.”

Plischke said he was able to start his company, which has a seven-vehicle fleet, without any debt so is able to compete.

“I’d say 50 percent of my sale is having to play in that arena, and then the other 50 percent is selling jobs at fair market value,” he said. “There’s a lot of customers that cannot properly protect their house with three doors and a motion sensor, and whereas most of these ‘slam-’em-in’ companies just want to get them in and out, and get as many monitored accounts as they can each day, I don’t mind parking my guy at one job for a day or two or three if necessary to install a complete alarm system.”