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VAR Best Practices: Building Your Business By Doing What's Right For Your Customers [51:18]

Join Larry Henry and Bill Hersh as they discuss best practices for an IT business using data gathered from thousands of VARs in the SMB channel. Here is your chance to learn what steps other VARs have taken to achieve the level of success that they have reached. Regardless of the success of your business, good or bad, there are tips and directions for everyone in this discussion. Take your business to where you want it to go!

Topics of discussion include...

Getting more of the customers that you want
Tools for getting more from each sale
Image changes to bring you and your customers closer together

Resources

Downloads:

D&H Resources:

D&H Partner Services

Webcast Q&A

Q: When you're talking about not itemizing, are you referring to when building a computer or equipment or are you talking about giving a total for computer and labor?
A: we are addressing both points, but primarily the overall solution total. The VARs that use this strategy report greater success, both in overall profit and in customer satisfaction.

Q: Do you happen to have any templates regarding the Business Assessment Check List or is that the link you were just referring to that I didn't see?
A: We have both the Business Assessment Checklist and the Assessment Follow-Up Template. If you have not received either or both of these documents, please e-mail solutionslab@dandh.com. Our Partner Services program also offers a wide variety of applicable templates for growing your business via additional advertising and marketing. For more details on this program and its offerings, please go to www.dandh.com/partnerservices or e-mail partnerservices@dandh.com.

Q: How do you get started when you're a start-up, one-man show, or actually two or three? Hard to compete with the "Big" boys and girls.
A: What we hear is that the vast majority of small customers, typically 3-15 employees, are overlooked by larger VARs. A few of our most successful VARs have built their practices on appealing almost exclusively to those businesses with little or no IT infrastructure at all. While this strategy requires a little more patience as you winnow through those potential customers that really don't want any IT, it also results in a much stronger relationship, since there is nothing to compare the VAR with and they are used to paying for a solution from Day 1, as opposed to those customers that have gotten used to double-checking their VAR against on-line pricing.

Q: I have a customer setting up a second storefront and wants to have the storefronts able to connect to each other. Without going to a third party, how is this easily accomplished?
A: To be honest, this sounds like a simple connectivity opportunity. You may want to start by talking to the business team at their existing ISP. If that conversation doesn't get you what you want, you may want to talk to competing connectivity providers (cable vs phone company, etc). If this isn't something that you're interested in, then you may want to search for a business partner that specializes in WAN connectivity.

Q: How can we introduce leasing into the client presentation?
A: We find that leasing and other financing options are best introduced as a prepared offering (payment amount) during the Assessment Follow-Up. The discussion usually starts with the solution conversation and turns to the leasing/financing conversation if the customer balks at the overall price. The other upsides of offering leasing or financing options are: A) potential opportunity for increased depreciation on the solution, B) opportunity for the customer to move the solution from being a capital expenditure (incremental cash outlay) to being an operational expenditure (budget line-item), and C) opportunity for you to turn their solution into a regularly-refreshing hardware/software/infrastructure offering.

Q: Was this session recorded for viewing gain later?
A: Yes, US customers can find it available for on-demand viewing at www.dandh.com/solutionslab, while Canadian customers can view this for up to 90 days at the same link that you used to view the live presentation.

Q: I like bottom line solution price. Any suggestions for those accounts asking for itemized lists? Some say they need it for tax purposes, etc.
A: Other partners typically find out what level of granularity is required for reporting and then their pricing is kept to that level. For instance, if you did a Windows Server implementation with an Exchange Server, a few clients, and some network upgrades, you may be able to offer pricing for each piece of that: one for the Windows Server, another for the Exchange Server, one to cover all of the clients, and then a last one for the network upgrade, resulting in four prices. These four prices are still not as granular as the line-item pricing that we're looking to get away from. If your customer requires still more detailed pricing, we recommend breaking out into component solutions as suggested above, breaking out each into hardware, software, and services. Using this strategy, you still aren't being pushed to list out a per-hour service fee or a per-item hardware or software components list.

Q: What about something like GFI Max?
A: Assuming that you're asking about offering cloud-based services, we recommend that every VAR not only be aware of what's available, but have some of those services available as your own customer offerings. Cloud services can be priced and addressed in the same manner as other parts of the solution, since there is still installation, configuration, and maintenance involved.

Q: Is there a way to start having the customer start thinking about upgrading old hardware to increase productivity, after telling them their systems are old or not as secure as new OS's?
A: The two strategies that we've seen be most successful are either a productivity story or a security story. Older systems typically offer slower response times, both client and server. How much time is being wasted by employees waiting for their system or the server to respond? How much longer is it taking an employee working with a large spreadsheet to make changes? How many are restricted by older versions of Office to a certain top-level spreadsheet size? Older systems also offer a much larger vulnerability footprint, and, contrary to popular thought in the SMB community, small businesses are now the prized targets of malicious hackers. They offer less chance of really following up on a theft of funds, and usually don't have the resources necessary to chase their lost money or other assets. The security difference between Windows Server 2003 and Windows Server 2012 is significant, as is the difference between Windows XP Pro and Windows 7 Pro.

Q: Adding to that, the technology assessment opens the opportunity to offer technology asset management - which most small business don't have.
A: Excellent point.

Q: When do you say no to a client or let them know they are NOT a good fit?
A: When you no longer want to deal with them. If you avoid their phone calls or physical visits, it is time to introduce them to a new "computer guy".

Q: You guys seem to be advocating staking out a middle ground between break fix computer guy and full on managed services. Can you talk to that please?
A: No, we are actually advocating examining the overall customer opportunity and choosing what parts you, as a VAR, want to offer. There is no reason to make a choice between break-fix and managed services; both of them offer income opportunities and customer-interaction opportunities. The key, in our opinion, is to be aware of the complete extent of your customer opportunities, so that each of you can make an informed decision as to what you want to offer and how you want to work with your chosen customers.

Q: Any competing points to beat Dell, etc?
A: "Beating Dell" is exactly what we're addressing here. Dell's entire value-add is price, and nothing more. You, on the other hand, offer product selection, installation, configuration, on-going maintenance, and hands-on partnership. Dell may offer low pricing, but they will never offer a technology assessment or the kind of interaction that you can. Your customer may bring a Dell price to you, and they may even point out that they've talked to a competitor of yours about handling the other services. This still leaves you in control of the situation. By specifically pointing out interactions like the Business Assessment Checklist and your on-going interest in their ability to leverage technology, you're either going to A) eliminate your competitor and Dell as an option, or B) expose this customer as being more price-focused than you may have initially thought. At this point, you can determine whether or not you want to keep them as a customer.

Q: What is the best way to transition clients from break/fix to managed Services?
A: The easiest transition is a slow one: adding services to your existing business and slowly eliminating your break-fix services. You can move faster than this, obviously, but your chances of alienating many of your existing customers is fairly high.

Q: How much effort should you expend getting a new customer that is just shopping for the cheapest price?
A: NONE

Q: What is your input to the value of quarterly business reviews with vCIO?
A: QBRs hold huge value for a VAR. They not only show your customer that you are a professional, they keep you top-of-mind for any/every technology consideration that your customer has or will have, and they enable you to gather substantial data on your customer's satisfaction or a fairly frequent basis. We highly recommend them.

Q: Do you feel that certifications still have any value in the reseller/end user community?
A: As long as you advertise it and speak to the additional value that you feel any given certification offers, yes, I believe that they still have value.

Q: How am I supposed to have a business assessment conversation with long-time customers? I've been their computer guy for years; this is going to be awkward.
A: You start the conversation with existing customers much like you would with a brand-new customer: you'd like to have a deeper relationship with them and help them to leverage their technology more effectively. Thus far, you have most likely addressed their needs on a today-only basis; going forward, you'd like to address their needs on a rolling basis, working within their own business plan.

Q: Why should my customer want to tell me about their business?
A: Because you are in a position to help them get the very best value out of every dollar that they put into technology, as opposed to them just buying what they might need at any given time.

Q: I tried this with one or two customers and they told me that they don't want me to do more than I already am.
A: Okay, that's their prerogative. At the same time, that means that they have no interest in using technology more than they have to, also their prerogative. Talk to other existing customers, talk to new customers. If you choose to keep being a computer guy to some of your customers, that's okay. If you decide to pick and choose among your existing customers for the ones that most want to work with you on a deeper basis, that's okay (better, in our opinion).

Q: I'm not sure what to look for when talking to my customers about their businesses; how do I figure this out?
A: The easiest way to start is to sit down and run through the business assessment checklist for your own business. This will help you to figure out what you need to know in order to serve those customers best. Please note, when you do the BAC for yourself, you have to make sure that you're painfully honest, and that you take the time to figure out your long-term goals, too, if you don't have any specified right now. You may also find it helpful to leave a copy of the business Q&A with your customer when you do the technology assessment, so that they can possibly have more answers ready for you when you come back to do the business assessment.

Still Have Questions?

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