Video Surveillance Is The Perfect POS Upsell

As a POS VAR, you probably run up against Internet POS resellers that force you to trim your profit margins just to remain competitive. If you only sell POS hardware and software, that kind of competition can drive you out of business. By embracing what it means to be a VAR, however, you can distinguish yourself from online POS retailers and another kind of competitor you might not have given much thought to: security dealers.

Security dealers are the companies that install video surveillance cameras and CCTV (closed-circuit television) monitors at c-stores (convenience stores), gas stations, and other retail stores — the same places you sell POS solutions to. So, what do those guys have to do with your business? A lot. Security dealers are taking away your chance to provide a total solution to your customers and earn healthy profit margins in the process. “A 16- to 20-camera surveillance install can generate up to $20,000 in sales revenue,” says Brandon Ring, national sales manager at Image Vault, a Division of FKI Security. “And, typical profit margins on integrated CCTV systems range from 35% to 45%.” Adding video surveillance to your POS repertoire is easier than you might realize. Three industry experts offer their advice on how you can make the transition and distinguish yourself from Internet resellers and security dealers.

1 — Video Surveillance Is A TCO Sell
Unlike selling POS hardware and software that meet your customers’ tangible needs to better track cash flow, selling video surveillance involves selling security, which is an intangible benefit. “The biggest challenge POS VARs that want to sell video surveillance face is not taking on a new technology, but learning how to sell the TCO [total cost of ownership] of security,” says John Paget, COO and president, North America, SYNNEX Corporation. “This is where a value-added distributor [VAD] can help by providing training in the form of online instruction, marketing materials, and even on-site classroom training and customer sales support.”

The first thing VARs need to do before they discuss TCO with their customers is to understand the business value themselves. There are two primary reasons companies install video surveillance systems, and the primary one is to reduce inventory shrink. According to the 2004 University of Florida National Retail study, retailers lose approximately 2% of total sales each year from shrink, and nearly half of all shrink is the result of employee theft. Knowing this, VARs can use a consultative selling approach to uncover whether a client or existing customer has concerns about theft and what they’re currently using to thwart theft.

Concerns about customer satisfaction are the second primary reason a company could be in the market for a surveillance solution. “Video surveillance systems are excellent training tools,” says Paget. “If, for example, a customer calls us and says, ‘I ordered five memory sticks and you shipped me only four,’ we can use the surveillance system to view the moment the customer’s order was fulfilled in our warehouse and know exactly where the problem occurred.” If the employee made the mistake, the video can be used to point out the error and to provide additional training that can prevent the same error from occurring in the future. If the customer made the mistake, on the other hand, the video can be used to confidently confirm that their order was complete when it left the warehouse.

2 — You Don’t Have To Find A Video Surveillance Solution Yourself
A video surveillance system is a combination of several hardware and software components, including video cameras, a DVR (digital video recorder), enclosures, CCTVs, motion detection devices, remote management software, and in some cases networking services such as QoS (quality of service). And, there are a variety of brands and models to choose from. Take video cameras, for instance. Some cameras are wired and some are wireless. Some cameras use analog signals and others transmit IP (Internet Protocol) packets. Some cameras are designed for indoors, and others can be used outdoors. The point is that you don’t have to spend the next year and a half trying to figure out which components are best suited for you and your customers, because there are VADs that already have bundled solutions that have been tested and proven. Your VAD should have surveillance solutions for SMBs, large chain retailers, and everyone in between. It should even have video surveillance solutions designed for specific vertical markets such as healthcare and c-stores. Even if you find a component later on that you like better than one of the components your VAD recommends, at least you have a good place to start.

3 — You Need To Have (Access To) A Video Surveillance Demo Unit
One of the challenges of selling a video surveillance solution is that it’s hard to fully appreciate its value without getting to see it in action first. Tony Sorrentino, VP of merchandising at ScanSource Security Distribution, advises, “VARs should buy a demo solution to have working in their offices for sales training and customer showcase events.” Many VADs offer special deals on demo units, also. For VARs that just don’t have the budget to invest in an in-house demo unit, there are other options to consider. “Selling video surveillance begins with your existing POS customers that you already have an established relationship with,” says Paget. “VARs can work with these same long-term customers to use their facilities as demo labs for new clients.”

Another option is to use your VAD’s training center to demo a video surveillance solution. The benefit of this option is that VADs have access to a plethora of solutions that can be set up and configured to match your client’s specific needs.

4 — POS Integration Is Your Key Differentiator Don’t forget about one of the reasons I’m suggesting you expand your POS business to include video surveillance — beating out your competitors. One of the primary benefits a POS VAR offers that Internet dealers and security dealers don’t is the ability to integrate POS with video surveillance. You already know how to output data from the POS software to peripheral devices such as printers and PDAs; interfacing POS software with a DVR isn’t any different. “Security dealers, on the other hand, don’t want to touch POS software,” says Ring. “They don’t own it, and if they break it, they know they can’t fix it.”

Think about how much more valuable a video surveillance system is when it’s integrated with the POS solution. “POS integration makes the process of reviewing video footage much more efficient,” says Sorrentino. “VARs can index specific events that occur at the POS station, such as sales over a particular dollar amount or returned merchandise, and review the video footage that corresponds with those events.” Not only will this lead to shorter, more effective investigations, it also makes video surveillance more useful as a training tool. For instance, several cashiers may take turns working a cash register during an 8-hour shift. By capturing a cashier’s login information at the POS, VARs can enable their customers to view video footage corresponding to a specific employee. This can be especially helpful in monitoring new employees to make sure their work is up to par.

VARs can further endear themselves to their customers by offering one service contract for the integrated POS and video surveillance solution, which is something a security dealer or Internet retailer won’t be able to do. Once your clients understand all of the value you offer compared to the Internet box movers, they’ll gladly pay a little extra for your expertise and partnership.