Pricing is the single biggest factor in your security company’s profitability. Price too low and you can’t sustain quality service or invest in growth. Price too high and you lose bids to competitors. Getting it right requires understanding your true costs, your market position, and the value you deliver.
Calculating Your True Cost Per Guard Hour
Many security companies underestimate their costs, leading to contracts that lose money. Your cost per guard hour must include the guard’s basic wage, employer’s National Insurance, pension contributions, holiday pay accrual (including bank holidays), training costs amortised across working hours, uniform and equipment costs, and insurance premiums per guard.
Then add overhead allocation: management time, office costs, technology systems, vehicles, and administrative support. The total cost per guard hour is typically 35-50% higher than the guard’s hourly wage. If you’re quoting based on wage plus a percentage, make sure your percentage covers everything.
Market Rate Awareness
Research the going rate in your area and sector. Rates vary significantly by region, with London and the South East commanding premiums. Specialist services like close protection, dog handling, or events security carry higher rates than static guarding. Understanding the market helps you position competitively without leaving money on the table.
Value-Based Pricing
The most profitable security companies price based on value delivered, not cost plus margin. If your technology platform provides real-time GPS tracking, automated reporting, and checkpoint verification that competitors can’t match, that has value worth paying for.
Articulate your value proposition in terms the client cares about: reduced risk, professional reporting, compliance evidence, and operational transparency. Clients who choose you on value rather than price are also more loyal and less likely to switch for a marginal saving.
Contract Terms
Build annual rate reviews into your contracts tied to minimum wage increases and CPI. Include clear terms for additional services, overtime rates, and cancellation periods. A well-structured contract protects your profitability over the contract term and avoids difficult renegotiation conversations.
Ready to modernise your security operations? Request a free demo of TacDesk and see how cloud-based guard management can transform your business.