22 Dec CSPs have a ‘Licence to Bill’
One-off licence sales are on the wane while growth lies in recurring revenue licences. It isn’t news to anyone that this is becoming the norm but, in order to embrace this change, partners will have to think more deeply about how to keep customers renewing licences with them and not going elsewhere. Moreover, how does one recognise more revenue opportunities with that customer?
Personalisation, partnership, profitability & predictability
Customers should feel genuinely involved in a relationship with a supplier, not just a “preferred supplier relationship,” but at a more personal level. They must feel like their custom is valued, and when they do, they’re more likely to turn in that direction as a first port of call. This goes not just for licences, but for solutions, consultancy, or advice when they’re considering an investment in IT.
Achieving profit in the CSP model depends on minimising costs and maximising sales, but it doesn’t end at just Microsoft licence or cloud product sales. ISV partner product opportunities, direct value-adds, hardware, other software, expertise and delivery are all commodities that CSPs can monetise, and use to increase customers’ reliance on the partnership. To be profitable, though, CSPs need a slick system with processes which provide reassurance of products being provisioned correctly, billing running accurately and information being made available to manage at customer, reseller or direct or indirect partner level.
Reconciliation of Microsoft costs and customer sales should be swift and accurate. One upside is that recurring revenue provides predictable cash flow (the lifeblood of any business). Modelling of price changes, bundling and providing a collection tool all provide CSP’s with levers to prompt customer interaction. Hence CSPs can appeal to customers’ buying habits without administrative headaches or overheads.
It comes down to one simple business principle: what do you do better than your competitors? If the answer includes any of the following: cost consciousness, flexibility, engagement, reaction, information sharing, accuracy or timeliness, then come talk to Astel about GlobillCSP.