Syosset Lock Shop owner Steve Palumbo says his main competition in recent years has been “internet ghosts” — nationwide operations that thrive by using local internet advertising and call centers to make consumers think they’re local businesses.
These companies take customers from businesses like Palumbo’s and can damage all locksmiths’ image if they overcharge or do shoddy work, he said.
“We worked to get the reputation we have, and these guys are riding on our coattails,” said Palumbo, who bought Syosset Lock Shop in 2009 after working there since the 1980s. He said he has even gotten reports of these internet operations claiming to be his business, which has been in operation since the 1970s.
His shop is in the process of getting licensed through the Nassau County Office of Consumer Affairs, which requires that locksmith businesses provide proof of their physical location in the county. In Nassau, anyone who provides locksmith services must be fingerprinted and background checked, and provide proof of their training.
Suffolk County has no locksmith license program, said James Andrews at the Suffolk County Department of Labor, Licensing and Consumer Affairs. And while some states license locksmiths, New York State does not.
In recent years, companies claiming to be local locksmiths offering cheap lockout or lost-key services have flourished. Many of these businesses have no physical location. Calls to them get routed to a national call center, and an area independent contractor is sent out on the job, industry experts say. These locksmiths sometimes charge much more for the service than advertised after the job is done, tacking on extra fees and sometimes refusing to return the customer’s keys until they pay up, Palumbo and others said.
In an industry that offers an on-demand emergency service such as changing locks or unlocking a car, consumers are frequently looking for help in a hurry based on a quick internet search. Palumbo said he and other local locksmiths lose business whenever a potential customer calls one of these companies.
The Federal Trade Commission, the government agency for consumer protection, has put out warnings about locksmith pricing scams, advising customers to be careful when selecting a locksmith.
Across the country, stings by local news outlets or law enforcement to shed light on the issue are common, but no enforcement action or regulatory changes have occurred to combat the problem, said Tom Foxwell, president of the Dallas-based trade group Associated Locksmiths of America.
“Lots of us are losing business because of this,” Foxwell said.
Palumbo said he started noticing these companies around 2007 when customers began complaining about being duped and needing more work done on a lock that was not installed properly by one of the scam operations.
When some customers said they reached call centers that claimed to be Palumbo’s business, he said he contacted the District Attorney’s office and was told he would have to present proof, but he said that was difficult to provide. A spokesman in the DA’s office said Palumbo could file a complaint with any documentation of the impersonation, and “we will review it.”
Tom Lynch, president of the Society of Professional Locksmiths, a Nyack-based trade organization, said “mom-and-pop’s don’t have the juice . . . to get someone to pay attention.”
That’s why local marketing for a shop like Palumbo’s is increasingly important, business and industry experts said. The marketing should be diversified — in print or on TV, as well as in person or online — and focus on connecting a familiar local face to the locksmith business.
“They need to get out more, shake hands, kiss the babies, and interact with their community to let them know what’s going on” with the scammers, Lynch said. He recommended Palumbo try setting up outside a grocery store or at local events to connect with community members.
Palumbo said he has focused efforts on educating customers who come into his store with articles from the FTC on his shop counter, and by being frank and open about problems in the industry when people call for consultations.
Joining and using the local chamber of commerce as a conduit for reaching customers could also help improve a business’s reputation, said Roz Goldmacher, president of Long Island Development Corp., an organization that advises and lends to local small businesses.
And instead of chasing business from locked-out individuals, the shop can focus on growing other revenue streams, such as work from larger commercial business clients, Goldmacher said. Syosset Lock Shop already services several shopping centers across Long Island, as well as some hangars at MacArthur Airport, Palumbo said.
Last year, Palumbo brought on a web and business consultant, Simon Lewis of Suffolk County Webmasters in Holtsville, to help with online marketing. Hiring a consultant was cheaper than paying for online advertisements, which charge per click, Palumbo said.
Lewis said he has focused his efforts on search engine optimization — getting Syosset Lock Shop to show up first in online searches through encouraging customer reviews online and providing basic information about the business — including a photo and hours of operation — to the search engines.
An online post from a disgruntled former employee that shows up in online searches has added to the work, and Lewis said his goal is to have Syosset Lock Shop gather enough satisfactory reviews to crowd out one bad egg.
“Word-of-mouth expressed in online reviews is absolutely vital for a business like this because that’s something call center, aggregation-driven businesses can never have,” he said. “They don’t have that source of genuine goodwill.”