Knowing how much a security company makes per guard isn't just a statistic — it's the foundation of your business strategy. 

When you understand this metric, you can make smarter decisions about which contracts to take, which clients to prioritize, and where to focus your resources for the best returns.

In this guide, we’ll cover:

• Profits per guard
• Costs per guard
• The formula for calculating the total profit per guard
• Factors affecting profit margins
• Tips to improve profit margins

Read on to learn more about the factors affecting how much your business can make per guard.

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How much does a security company make per guard?

Breaking down profitability often starts with calculating the margin per hour worked. We’ll break this into three key areas: 

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Hourly billing rate

The heartbeat of revenue generation lies in the hourly billing rate — the amount clients pay for each hour of a guard's service. There’s a spectrum of factors that influence this rate:

• Guard's wage: Companies generally mark up the guard's wage by 1.5 to 2.5 times to determine the billing rate. For instance, if a guard in Minnesota earns an average base salary of $19.13 per hour, the billing rate could range from about $28.50 to $47.50 per hour.
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• Company size: Larger, more established companies can often command higher billing rates due to their reputation and broader service offerings. A small company might charge $35 per hour for an unarmed guard, while a larger one might bill $45 for the same service.
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• Service type: The nature of the service significantly impacts the rate. Unarmed guards may be billed between $20 to $40 per hour, while armed guards or those providing specialized services like executive protection can command rates from $50 to over $100 per hour.
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• Location: Geographic location plays a role due to variations in labor costs, competition, and client expectations. For example, security services in major cities or high-risk areas might be priced higher than those in smaller towns.

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Shift and contract length

Longer shifts lead to more billable hours, directly boosting income. Similarly, ongoing contracts provide predictable revenue compared to one-off events. Contracts can range from short-term agreements of a few weeks to long-term commitments of several years. 

Consider this: A guard working a 12-hour shift at $30 per hour generates $360 in revenue for the company on a 6-month contract, which translates to roughly $46,800. In contrast, a guard working sporadic 4-hour shifts at events might only bring in a fraction of that amount.

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Additional services

Expanding beyond basic guarding services unlocks further revenue potential per guard. When seeking the answer to the “How much do security companies make?” question, consider how these value-added services can boost a company's earnings:

• Specialized training: Providing advanced training, like firearms instruction or emergency response, allows companies to charge premium rates for these highly skilled guards. A company might bill $50 per hour for a standard guard but $75 or more for one with specialized training.
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• Event management: Coordinating security logistics for large events involves complex planning and execution, justifying higher fees. A company could charge a flat fee or an hourly rate for event management services, adding to the revenue generated by each guard deployed.
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• Consulting and risk assessment: Offering expert guidance on security strategies and vulnerabilities positions a company as a trusted advisor, commanding higher fees for their expertise. Consulting services can range from $1,000 to $5,000 or more, depending on the project's scope.
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• Technology solutions: Installing and maintaining security systems generates recurring revenue through service fees and equipment upgrades. A company can charge a monthly monitoring fee for surveillance systems, adding a consistent revenue stream.

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What are the costs involved in each guard?

Security guard costs per month will eat into your margins and revenue. Let's break down the key expenses:

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Wages and benefits

The most obvious cost is the guard's base pay. This will vary based on experience, location, and the type of service they provide. You must also remember to factor in overtime pay, which can quickly add up if shifts run long or unexpected situations arise.

Then there are benefits. Health insurance, retirement contributions, and paid time off are all part of the package that attracts and retains quality guards.

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Training and certification costs

Guards need proper training to handle various situations, from de-escalating conflicts to responding to emergencies. Depending on your location and the type of services you offer, there may be certification requirements that come with their fees. 

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Uniforms and equipment

Guards need to look the part and have the right tools for the job. This means investing in uniforms, which may include shirts, pants, jackets, and even specialized footwear. 

Equipment costs can range from basic items like flashlights and radios to more advanced gear like body cameras or firearms. These costs might seem minor, but they can add up over time, especially if uniforms and equipment need frequent replacement due to wear and tear.

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Administrative and overhead costs

Beyond the direct costs associated with each guard, there are the behind-the-scenes expenses that keep your business running smoothly. This includes the salaries of your management team, HR personnel, and any legal or compliance experts you may need.

There's also the cost of office space, utilities, insurance, and other overhead expenses — all key to running smooth security operations.

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A simple formula for calculating profit per guard

Now that we've explored the various costs associated with each guard, let's calculate your profit per guard. To make that calculation, you can use this simple formula: 

Revenue Per Guard - (Wages + Benefits + Equipment + Overheads) = Profit Per Guard

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Example calculation of profit per guard

Here’s how you can figure out how much a security company can make per guard.  

Let's say you have a guard in Minnesota earning an average wage of $19.13 per hour. You bill them out at $32 per hour, and they work a 40-hour week. 

Let's also assume their benefits cost $5 per hour, equipment costs $1 per hour, and your overhead allocated to each guard is $3 per hour.

• Revenue per guard: $32/hour * 40 hours/week = $1280/week
• Costs per guard: ($19.13 + $5 + $1 + $3)/hour * 40 hours/week = $1125.20/week
• Profit per guard: $1280/week - $1125.20/week = $154.80/week

In this scenario, your company makes a profit of $154.80 per week for this guard. 

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Factors that affect profit margins in security services

Even with a solid understanding of your costs and revenue, you might wonder, are security companies profitable in the long run? The answer depends on several external factors that can influence your profit margins. Let's explore a few key ones:

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Location and market rates

Location plays a critical role in both your costs and the rates you can charge. In areas with a high cost of living, you'll likely face higher wages and overhead expenses. Similarly, regions with a strong demand for security services may allow you to command premium prices.

It's essential to be aware of the market rates in your area. Charging too much could drive clients away, while charging too little could leave you struggling to cover your costs. Striking the right balance is key to maintaining healthy profit margins.

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Client demands and expectations

High-demand clients or those that need specialized services may be willing to pay a premium, boosting your revenue per guard. However, these clients often have higher expectations, which can lead to increased costs for training, equipment, and oversight.

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Guard retention and turnover

Focusing on guard retention through competitive wages, benefits, and career development opportunities can help reduce turnover and its associated costs. Remember, a stable and experienced workforce is a valuable asset that contributes to your bottom line and reputation.

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Tips to improve profit margins for security companies

Let's look at some actionable strategies to enhance your profit margins:

• Optimize scheduling and overtime: Implement intelligent scheduling tools and predictive analytics to forecast staffing needs accurately. This helps minimize unbilled overtime and guarantees optimal shift coverage.
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• Offer tiered services: Create a tiered pricing structure with premium packages for specialized guards or high-demand services. This allows you to cater to a wider range of clients while maximizing revenue potential.
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• Reduce administrative overhead: Use a security management platform to automate tasks like scheduling, payroll, and reporting. This frees up your staff to focus on core business activities and lowers administrative costs.
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• Improve guard training and efficiency: Provide high-quality training that equips them to handle more complex tasks. This improves service quality and justifies higher billing rates.

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How Belfry’s security management platform helps boost your per-guard profits 

Now that you know the answer to the question, “How much does a security company make per guard?” Let's explore how Belfry can help you maximize your earnings. 

Our comprehensive security management platform simplifies operation management, giving you the tools to boost profitability and achieve sustainable growth.

Here's how Belfry helps you boost profits per guard:

• Automated payroll and overtime management: Belfry’s platform eliminates the challenges of manual payroll calculations. This greatly reduces unbilled overtime, optimizing your labor costs.
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• Real-time financial insights: You can gain a crystal-clear view of your profitability per guard and per contract with our built-in analytics. We help you make smarter decisions based on trustworthy data.
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• Efficient scheduling tools: We help you guarantee seamless shift coverage while minimizing wasted hours. With our platform, you’ll be maximizing the productivity of your workforce without straining them. 

Schedule a Free Demo Today.