Richard Soloway: All right. So, our concept in our company is integrated solutions and we have an integrated engineering department to develop all these products in-house. We don’t go offshore. It’s all done in-house. We have our own factory. We don’t use subcontractors. We have our own factory in the Dominican Republic and we have been getting recurring revenue in two of our segments, which is the fire alarm and burglar alarm But we want an integrated recurring revenue solution for all of our segments, which means the locking and access and the introduction of Air Access gets us recurring revenue for every segment and it is a great thing for lock smiths and access control dealers, because they now can start getting recurring revenue like a fire and burglar alarm dealer can do.
And there is a very big if they sell any of these accounts, like, for instance, a fire burglar alarm dealer sells an account to an ADT or another company, there is a 35 to 40 time monthly multiple that the dealer can get by selling one account to one of the large alarm providers. So, we think that the locksmiths and the access control dealers who don’t get that recurring revenue stream from their products, because those products don’t really offer it, but Air Access does. And we think that from our focus groups and the initial training that we’ve done that we think that this is a billion dollar industry, Air Access with recurring revenue and locking and we’re excited about it. But it’s going to take another six months to a year before it becomes more mainstream, because it is a big change for locksmiths and access dealers that they really got recurring revenue.
All they got was a service contract to replace the lock or to come in lubricated it or to upgrade the software and access system on site. Now all of this is done by Air Access and they can now give additional services to their clients, which are very valuable to their end-user clients. So, we’re very excited about the future of Air Access.
Christopher Hillary: Great. Thanks for all that. And then anything on your re-occurring revenue pricing per year that you could share with us? How that tends to evolve or how you’re planning on managing that? Thank you.
Richard Soloway: Yeah, we have a price list. We have a price list for each of the different types of radios we manufacture, including our €“ we talk about it as radios, but NAPCO does more than radios. NAPCO also makes the control panels for new work. We make it both fire and burglary control panels and each of those control panels has a radio built into it. In the past, they all use copper, but as we know, copper is dead and the dealers are switching their new jobs over to radio and now we have radios built into our control panels, which is a very, very popular product line with us. We’re very busy building these control panels with radios inside. So, we do the rip and replace radios for all the lines that are going dead fire and burglary, where you keep the control panel and the system that you have, you want to rip it out, you put our radio there, and our radio is what we call the universal radio, different than anything else on the market because the one radio does any type of control panel, whenever it was made, whichever brand it is, it works on everybody.
It doesn’t just work in the NAPCO ecosystem. And then, we have our control panel with the radio built in. So, we have this menu. It’s a published menu, but we make the most on the fire radios, because the fire radios require more handshakes from the central station. In other words, more signals going back and forth. So there is more traffic and we charge more for those. But we are keeping our pricing the same and we think priced right and you can see where the margins are.
Christopher Hillary: Thank you.
Kevin Buchel: Thanks, Chris.
