5 Aug 2019

Why choose RMR solutions? (Part 1)

Most integrators and dealers are in favor of a Recurring-Monthly-Revenue (RMR) setup, which provides them with the opportunity to serve customers while simultaneously building consistent revenue for their businesses.

Each year, this trend in RMR growth for dealers and integrators is increasing. In its 2019 Recurring Revenue Report, Security Sales & Integration Magazine notes that a quarter of respondents say in excess of half their companies’ revenue is derived from RMR business, with respondent companies averaging more than 29 percent growth in overall RMR the past five years. 

RMR - Strong Customer Connections

The amount collected from RMR each month is growing as well: “As a whole, dealers and integrators...are averaging well in excess of $100,000 in total RMR generation” according to the report. When the publication removed large national providers to determine what a typical independent dealer is earning, the number was closer to $30,000 per month.

RMR also enables integrators to develop a stronger connection with the customer, conveying that they understand their specific needs and will always be available to provide the necessary service. This can also lead to a potential increase in business down the line, as the integrator becomes a trusted partner in the end user's eyes. They can present customers with added flexibility when it comes to their security solutions, allowing them to overcome challenges they may not be able to take on themselves.

Passive Income

With on-premise solutions, there comes a significant investment in equipment — both hardware and software. This is good for the integrator for the project, but doesn’t result in continuing revenue each month, which is what a cloud-based solution provides. End users that choose the on-premise solution also have the added burden of ensuring the equipment is up-to-date with regard to security protocols and the latest firmware. They also tend to need an on-site IT team to help with these updates, which can be costly and prohibitive for many SMBs. Finally, the hardware of on-premise solutions must be updated over time, further increasing the financial burden. On the other hand, a cloud-based solution that facilitates automation is always up-to-date, doesn’t require an IT team to ensure updates are made and significantly reduces the upfront investment.

Cloud-based services that bring in RMR provide integrators a steady flow of revenue each month, which is considered “passive income.” In a business that has traditionally been built on a “per project” basis, revenue that can be anticipated each month is a positive step toward being able to budget accordingly. Additionally, having continuous customers and building that relationship over time benefits the integrator by providing an ongoing opportunity to upsell more products and services.