In recent discussions regarding the state of recurring monthly revenue (RMR) for 2024, several key industry figures outlined their companies’ performance and future expectations, highlighting the evolving landscape of business practices in response to both challenges and opportunities.
Chuck Petrusha, speaking to SDM Magazine, indicated that while overall RMR is set to demonstrate single-digit growth from 2023 to 2024, the company’s focus is shifting internally to understand customer attrition. He noted that the slowdown in residential business is not being driven mainly by DIY competitors but rather by a general deceleration in housing starts, although there remains a robust demand for multi-family housing and commercial sectors. Petrusha expressed satisfaction with a projected RMR growth rate in the range of 7 to 8 percent and detailed a proactive approach in response to the impending discontinuation of AT&T’s telephone lines, which is encouraging existing customers to transition to alternative monitoring solutions such as cellular or Wi-Fi connections.
On a parallel note, Kathleen Ford reported a target of achieving 10 percent of her company’s revenue from RMR in 2024, with ambitions to escalate this figure to 15 percent in 2025. Notably, she highlighted a growing trend within the public sector, particularly through contracts with the Department of Veterans Affairs, which are increasingly seeking long-term agreements for embedded technicians and maintenance services. Ford described the advantages of these contracts, allowing customers to benefit from continuous management of their systems rather than a mere installation model. This development marks a shift whereby on-premise services, rather than cloud-based solutions, are gaining traction in the public sector, suggesting a new avenue for revenue generation.
Furthermore, Greg Parker reported an RMR growth of approximately 8 percent alongside a 10 percent increase in orders for his operations. He recognised the potential for hybrid managed services models, where offerings like the Open Blue connected security service utilise a team of engineers to manage client needs more effectively. He elaborated on the significance of subscription-based services, which not only span security but also integrate life safety and HVAC systems, illustrating how addressing unmet customer requirements can yield substantial opportunities for recurring revenue.
As the industry continues to navigate complexities posed by external and internal factors, the insights provided by these leaders underscore a strategic pivot towards nurturing existing customer relationships and innovating service offerings to adapt to shifting market dynamics. The anticipated focus on longer-term contracts, managed services, and adaptive technology solutions indicates an ongoing evolution in business practices aimed at enhancing operational resilience and growth.
Source: Noah Wire Services