The Security Service provider may be required to provide a level of investment in securing a new contract and may include this within the budget above or below the P&L cost line. This investment capital is generally designed to fund the operations of the site and site clusters in line with the Client contract or it maybe offered / provided as an enhancement, refurbishment or improvement of the facilities and equipment to either / and reduce operational costs, improve security operational output. The feasibility of the Security service provider’s budget proposal for the services is often contingent upon this investment. The proposed level of investment can often be negotiated and increased, as part of the overall contract negotiation.
Security service provider investment opportunities should be reviewed and considered within the wider CBRE / Client capital expenditure strategies and budgeting.
Security service provider investment can eliminate the need for separate capital investment, that may prove advantageous when balancing account level finances. Conversely, a Security service provider's proposed investment may not in some instances, benefit CBRE or the Client.
It is important to clarify the financial liability with any proposed Security service provider investment, depending on how the supplier proposes it is administered and processed. it can both a financial benefit and a financial burden for CBRE / the client or the Security service provider.
Security service providers should be challenged to:
- Clarify if the investment is the Security service provider's financial liability. If it is the Security service provider's liability the depreciation of the investment is not charged back through their operational costs. Depreciation is held on the Security service provider balance sheet outside of the account P&L and depreciated at the Security service provider's cost over the term of the contract
- Clarify depreciation expense is built into the Security service provider's own cost structure
- Verify the depreciation / amortisation of the Security service provider's investment on a separate schedule. For Example- If a Security service provider has invested $36K over a three (3) year contract term, the expense should be a straight-line allocation monthly
2. Key Points
SS-020 Ver 1.0 (May 22)
Confidential & Proprietary | 2024 CBRE Inc.
1. Overview
3. Examples of Security investments required
4. Footnote
Building integrated Security system
Video entry intercom system
Swipe card access control
Entry barrier / turnstile
Baggage / Goods scanning
Key systems
Monitoring Cameras
Infra red detectors
IP Wireless Camera systems
Security access gates
Entry barrier boom gates
Permimeter intrusion detection
Security Services
Supplier Investments
Contracting
It must be noted that for some Client accounts the Capital investment in technology may not be available and this may be impacted by the level of technology available in the country (ie; third-world countries may not have access to high-grade technology to provide solutions. In these instances, care must be taken when discussing Supplier investments to potentially overcome standard manned guarding costs.