This is the second part of our multi-part series on pay rates and bill rates, in which we look at the factors impacting the physical security industry with respect to competitive wages and contracts. We analyzed over 2 million shifts across the USA to come up with a comprehensive picture of bill rates and pay rates. We will be presenting our findings in detail in a webinar with Security Magazine on March 31, 2020. You can sign up here.
Why Are Bill Rates So Hard to Determine?
While security pay rate statistics are readily available, finding the most common bill rates for the industry is much more difficult. There are two primary reasons why this is the case:
- It’s not a required, reportable Item: Unlike pay rates, what a company charges for their services is generally kept as a trade secret or at least not readily shared. State and federal agencies (like the Department of Labor and Bureau of Labor Statistics) want to ensure that business owners are paying proper wages, but that’s not the case with bill rates.
- It’s a competitive statistic: In an industry like physical security services, the decision on disclosing bill rates is a competitive advantage. It’s very unlikely that any company will provide that information. As a result, bill rates are often a per-company decision, and difficult to benchmark when you don’t have thorough data.
It gets even more complicated when you think about the different rates for different aspects of guarding. Just as we discussed with pay, there are a few questions that add complexity to the equation:
- What is the premium to place on charging for armed versus guard services?
- Should bill rates change depending on location?
- What about government contracts (GovCon)? How much of a markup is too much?
- What’s the typical margin for a small business versus an enterprise security services provider?
Is There a Difference in GovCon?
While part of our focus is on the commercial physical security market, a lot of discussion in the past has been around GovCon. Many companies want to secure GovCon bids, and while they aren’t the easiest to win, success in GovCon can become a lucrative and consistent revenue stream for your business.
How lucrative? In our next article, we discuss the pay rate and bill rate differences in GovCon versus commercial. We will also be covering all these topics in detail in our Webinar on Pay Rates and Bill Rates with Security Magazine this March 31, 2020.