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November 2, 2020

Four challenges faced by the security services industry amid COVID-19

A business’s ability to adapt and face new challenges has never been more important than it has been this year. With the onset of the COVID-19 pandemic, all industries were challenged with the impact that has been made on business revenues and operational expenses, while at the same time struggling to implement the measures needed to keep employee safety a priority.

“It is not the strongest of the species that survives, nor the most intelligent. It is the one that is most adaptable to change.” Dr. Leon Megginson

The security industry has faced many of the same issues that all businesses are facing, but we’ve had to approach them in our own unique way. Below are some of the biggest challenges and how Champion is dealing with them.

 

Challenge 1: The Impact on Our Clients and Their Need for Coverage

One of the biggest ways our business has been affected is through the impact that COVID has had on our clients. Champion provides security coverage for many different industries, several of which have been severely impacted by the pandemic. Hospitality, travel, retail, restaurants -- any businesses where masses of people interact -- have seen such a large reduction in revenues that they’ve reduced their coverage to almost nothing or to nothing at all. 

 

On the flip side, there are industries where the pandemic has increased demand for security officers. Retail grocery businesses as well as any logistics operations that involve transportation of goods in the supply chain have needed more coverage to keep essential businesses running. Security officers are needed not only to perform their normal functions at these locations, but to take on the additional duties of ensuring PPE adherence and social distancing.  

 

Challenge 2: Implementing Safety Guidelines

Another large challenge has been ensuring adherence to CDC guidelines designed for employee safety. We first had to understand the guidance that was coming from the CDC, next we had to formalize a plan for our employees’ safety and then we had to adapt that to fit in with our clients’ operational needs. In many cases our clients wanted our officers to be the frontline for implementing their own safety policies like temperature checks. That brought an additional layer of things to work out like how to perform those duties while adhering to HIPAA regulations and how to carry out contact tracing if there’s an exposure to someone with a positive test. 

Challenge 3: Obstacles to Employee Recruitment

COVID has brought unique challenges when it comes to hiring new employees. People haven’t been as inclined to go out and find a job with the associated risk of COVID, especially since security officers are frontline workers. Unlike corporate workers who can work safely from home, security officers aren’t afforded that choice. They have to be on site as a function of their job. The additional unemployment benefit that U.S. citizens were provided increased that reluctance to enter the workforce because the benefits were higher than a person would make at an entry level job. 

 

The increased need for security coverage by some industries has outweighed the loss of business we’ve experienced elsewhere, but with the risk of COVID and the unemployment benefits, it’s been hard to cover that demand. We’ve stepped up our advertising and recruitment efforts and that has allowed us to weather the storm, but it remains an ongoing challenge.

 

 

Challenge 4: Increased Operational Expenses

The cost of doing business has increased for all industries and security is no exception. Most notably, COVID has taken a toll on insurance markets. Due to an increase in general and commercial liability claims and workers’ compensation claims, insurance costs are going up by 10-20 percent. That makes a big impact since insurance is the greatest business expense after payroll. When a business faces a huge increase in operational expenses like that, the cost gets passed on down the line, ultimately raising the costs of products or services. For security companies, the relief has to come in the form of rate increases.

 

How Champion has Responded

Champion has had to respond to these challenges in creative ways. For example, at the beginning of the pandemic when we were rolling out our health and safety guidelines, PPE was hard to find, so we quickly moved to create our own masks that we provide to officers at no charge. We provide cleaning supplies and disinfectant and we also frequently communicate our safety guidelines so our employees always have the latest information.

 

We’ve increased our advertising and recruitment spending to attract more applicants to help us to close any coverage gaps, but more notably, we’ve worked really hard to make our onboarding process more streamlined and more cell phone friendly. We’ve made it so prospective employees can complete much of the application, hiring and training processes at home in order to increase their safety. We’ve also reduced the number of folks we bring into necessary in-person classes. Before we’d have 8-10 people in a class, but now the max is 3-4 people.

 

What Clients Need to Know

The biggest thing clients should expect when working with a security partner right now is that the increased turnover is going to create some additional learning curves with the guards that are assigned to their facilities. Our clients need to know that they could see new faces more frequently, but that doesn’t mean that we’re not doing everything that we can to make sure our officers are fully trained and certified. It’s just a new element they have to adjust to.

 

Positive Changes that Will Stay in Place Post-COVID

Whenever great challenges like this occur, there are always silver linings. In this pandemic, it’s been the focus on safety. Whereas we’ve always focused on guard safety through risk assessment and assigning the right officer to the right account, this has made us take a closer look at how guards interact with each other and guests and find ways to make those interactions even safer. Champion and our clients have all gone through this exercise. A closer eye on safety is always a good thing.

 

Another positive change for Champion specifically is the faster onboarding process I mentioned above. This new streamlined process is going to attract more employees and give us a better return on advertising and recruitment budgets. We had to get there sooner or later, but the pandemic lit a fire under us to get it done now.

 

Business in general, and security specifically, is no longer business as usual. We all have to be adaptable to this pandemic, and any future viruses that have a similar impact, in order to succeed. From a positive standpoint, I’ve seen a lot of creativity and flexibility on how to get things done with employee safety in mind and that approach will serve us well in the future.

 

If you want to read more perspectives on issues facing the security industry and beyond, sign up for our monthly newsletter using the form below.

Bill R. McCoy
Chief Financial Officer

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