AS SEEN IN THE BOSTON BUSINESS JOURNAL
August 18-24, 2000
Reprinted with permission. All rights reserved.
Customer service, not brawn, keeps Palladion Services Inc. in the game
By Jill Lerner
Richard Primrose played tackle on the Yale football team while an undergraduate in New Haven, but today he leaves the protection to others. While the staff of his 3-year-old security firm is ready to answer a call for physical action, employees are more likely found delivering packages, greeting building occupants or lecturing on safety tips during the holiday season.
Such responsibilities embody the philosophy that guides Palladion Services Inc.: 'Security through service.'
Following that mantra has helped Palladion grow from a company of 50 people to nearly 230 full-time employees. From its 1,720-square-foot headquarters on High Street in the heart of Financial District, Palladion last year garnered more than $3 million in revenue, and this year is on track to bring in more than $4 million, according to its founder.
The success means that the Harvard Business School graduate last year drew his first salary from the company after bootstrapping Palladion with personal savings. Despite the long wait, working 80-hour weeks, the former security industry executive said he never doubted the company's potential. "This business to me is all about my reputation, and I guard it zealously."
Palladion provides uniformed security and concierge personnel to high-end commercial and residential properties in Greater Boston. Concierge staffers typically are stationed in a building around the clock, seven days per week in three, eight-hour shifts.
Despite his football background, Primrose said there was nothing in his personal history that foreshadowed his entry into the security industry following his graduation from Harvard Business School in 1990. Looking for opportunities in the service industry, Primrose landed at Memphis, Tenn.-based security giant Guardsmark Inc.
To Primrose, the company bore less resemblance to his football days in hometown Everett, and then Yale, than it did an earlier internship at the Walt Disney Co. "We're a service business that happens to be in the security industry," said Primrose, today a resident of Beacon Hill. "It's all the same. You differentiate yourself based on product knowledge and the ability to hustle."
And the entrepreneur did just that during his six years at Guardsmark, rising from manager of the Boston office to chief operating officer in charge of 11,000 employees and approximately $250 million before leaving in 1996. By then, constant travel had taken its toll, if not opened the entrepreneur's eyes to an observation that would form the cornerstone of his own enterprise.
"I believe to be effective in a service business you have to be close to your customers. The span of service was too large." Primrose believed he could deliver a more personalized service and the following year, opened Palladion downtown near its prospective customers, small- to medium-sized buildings of 20 floors or less.
Today, 80 percent of Palladion's portfolio of roughly 40 properties is a 10-minute walk from the office, and the company's six managers visit each site regularly. After ramping up the security business, the entrepreneur took his commitment to service a step further and added the concierge component. Today, the company receives 60 percent of its revenue from security services in commercial buildings and 40 percent from residential concierge services to high-end condominiums and apartment buildings. "That was the direct result of how well we did in our commercial buildings," Primrose said. "We want to do more for you than a traditional service provider."
Thomas D. Beaton, vice president of Burlington-based property manager the Dolben Co. Inc., said his company provided concierge service in-house to its Boston- area residential complexes before signing on with Palladion two years ago. "They're security-related but geared toward concierge services, and that's exactly what we needed," Beaton said. "In this particular industry, they are one of the few we've seen that provides this level of service and they do it very well. We recommend them to other people in the industry."
Charles S. Mattson, vice president of property management for Boston-based Leggat McCall Properties LLC, said he plans to continue with Palladion services at his downtown commercial buildings. "We bid the project out and they were the most competitive and seemed to provide the best product," said Mattson. "Most of the contractors will sell a very good story and won't live up to expectations, but these guys have."
As Primrose looks to expand into markets from New Haven, Conn., to Portland, Maine, he anticipates his greatest challenge will be meeting staffing needs in a tight labor market. The screening process is rigorous and includes a psychological exam. Employees typically have a customer service background. "Our goal is to get to know as much about them as we can. We have to honor the trust our clients give us." Of greater certainty, said the entrepreneur, is the fact he will not partner with outside investors to fuel that expansion. "I was attracted to this because of its purity. There's no hiding, no politics, you get up every day and survive and do well based on your own wits," said the corporate veteran, noting his company has always met payroll without bank debt or outside investments.
"This is the greatest thing in the world ... We earn our money every single solitary day."