April 13, 2016

The Hidden ROI of Surveillance in Business


There are many hidden benefits having a good surveillance system where you work—not just the obvious. Rather, there can be a significant ROI associated with a state-of-the-art camera system in protecting people, property, plant and equipment. Security ROI is complex and, at times, hard to quantify. The payoff from systems designed to protect a retail store, manufacturing plant or office often include many benefits beyond security that are easy to overlook—and some of those benefits are invaluable.

Consider, for example, the connection between surveillance cameras and Workers’ Compensation claims. Typically, a retail store that installs a video camera to deter shoplifting will measure the ROI of the system by traditional security metrics, such inventory shortage. But surveillance cameras also provide documentary evidence if an injury or accident occurs. That firsthand look gives business owners an idea of how to prevent future injuries or to challenge Workers’ Compensation claims that aren’t justified. And with the average comp claim amounting to $28,000 in medical costs, not including productivity loss and other costs, you can see how the ROI of a security system can be dramatically bolstered if it can help reduce unjustified claims.

For such reasons physical security is slowly evolving from a “cost center” to a “cost saver.”

Many systems include analytics to determine how many customers come in at different times of day, how long they stand in line and what aisles they browse. That information can be used to reduce costs, boost sales, and improve staffing, productivity and inventory.

Do the math. The classic formula for measuring security ROI is known as Annualized Loss Expectancy (ALE). This calculates the cost of a security incident in tangible forms, such as money and time, along with less tangible components, such as competitive advantage and business reputation.

Once you have the costs, multiple that by the chance of the risk occurring.  For example, if you have a 10% risk of a store being robbed, and the average robbery costs $15,000, you should spend no more than $1,500 for security.

To learn more about how Keystone Security Systems can help you apply this formula or about how surveillance can work to save your enterprise money, headaches and sleepless nights, contact us today at (585) 730-8324. Let’s lay eyes on the situation.