At the recent CompTIA event (ChannelCON) in Phoenix, many speakers were debating what the channel is going through and its future. Regardless of how you prefer to label the term to best describe what’s happening, it is clear that it is not business as usual.
It seems to us that you could easily use all the terms – transition, evolution and revolution to describe the state of the channel, but who really cares? The bottom line is that the channel needs to figure out what to do to step up and leverage the emerging opportunities to grow their business and make money.
Managing a service or using the Cloud as part of the technology infrastructure or implementing mobile solutions or upgrading hardware etc., are all part of the solutions mix. The magic happens when the VAR, MSP or ITSP combines the right mix of tools and services to get the job done right. Smart IT companies who can figure out the right solutions for their clients are already ahead of the game.
There are two key things that the channel can do to exploit the latest technology trends and build a recurring revenue business model.
First, they need to really understand the risks, opportunities and needs of their end-user clients! This will feed all requirements and decisions. The more they understand their client’s business, then the more they will be able to exploit the opportunity to sell them technology solutions.
How? Help your sales and technical staff to improve their skills in the following 5 areas (Seek some professional help to get the job done right because these skills are mission critical to your success):
- Open conversations on business risks and opportunities with top management instead of just the IT team.
- Perform professional business assessments (not just networking and asset assessments, but actual business operations assessments).
- Present the findings effectively with a powerful report to shock and awe. Use tools to help you generate professional reports and presentations.
- Recommend the right technology solutions with confidence regardless if it is Cloud, Manages Services etc. Focus on pay-as-you-go as much as possible.
- Close the deal with the right business and financial message – “We can mediate these huge risks, make your more competitive and we do all this for one low monthly fee!”
Second, I am sure you know of many technology sales deals that have fallen apart when the client saw the price tag. There is nothing worse than sticker-shock to loose a sale. Today, the end-user could pay-as they go! In sales-jargon, this is the sledgehammer you dream about to close a deal! “You mean to tell me that I can do all that and just pay a monthly fee? I can use operational expense instead of capital expense?” Yes!
VARs, MSPs and ITSPs should embrace all “as-a-service” technology solutions for one reason…it removes sticker shock and closes deals faster! You do the math…buy this for $100,000 or pay $1,000 per month…
Once you see this as a powerful sales closing tool, then you are well on your way to truly exploiting the latest Cloud and managed services. And, you will also be on your way to building a recurring revenue business model!
You should also know that most vendors are now open to discussions of financing their hardware. Doug Erickson, VP, WW Partner Programs, Juniper Networks, said so on the panel discussion at ChannelCON. In his words “challenge us to come up with ways to close more business”. It simply makes sense for vendors to support the new ways technology will be consumed by end-users. Open the conversation with your vendors and you will see that they are willing to work with you to share the risks and rewards. If your vendor says no, find another who will say yes!
Experts can debate till the cows come home about what the channel is going through and how it will affect your business. It’s probably all true to some degree. Digest it all and move on. Learning is great, but leveraging the knowledge to advance your business and generate more profits is the bottom line.
One of the most important benefits of the new ways of doing business is that you now have a method to “finance” just about every deal with your clients without depending on traditional loans, leasing or having your clients cough-up the money in advance.
VAR Office Suite is already taking the discussion further with financial institutions to get creative by offering pay-as-you-go for hardware-as-a-service – regardless of vendor brand. It will eventually happen as the business World shifts to the pay-as-you-go financial model of acquiring most things that they need to run their business.
There is a great business precedent coming from the Telco companies who have adopted a pay-as-you-go practice many years ago: “Get a free phone in return for a multi-year service subscription plan”. They have even figured out a way to offer more expensive hardware like iPhones by offering higher monthly fees for the same service plan! It is already being done every day. Now, VARs MSPs and ITSPs can get into the game.