November 17, 2016
Vendor Relations Made MSPeasy: Choose The Right Vendor
Managing vendor relationships has long been a challenge for IT service providers. However, with the right strategies, you can avoid a lot of headaches.
The vendor/service provider dynamic has changed in the last 10 years. Historically, vendors held the majority of power—dictating margins, charging for partner program participation, and imposing sales quotas. These days, many channel-focused vendors have done away with these unpopular practices. Today’s leading vendors strive to develop great, trusting and rewarding relationships with the managed service providers (MSPs) with whom they partner.
Good relationships begin with choosing the right vendor in the first place. There are many things to consider before signing on with a vendor. Another important part of developing strong vendor relationships is setting expectations up front. This can bring clarity to the relationship by defining each party’s role and responsibilities.
Carefully choosing vendors with whom to partner will save IT service professionals a lot of trouble in the long run. There a lot of factors that should play into the decision making process, the most obvious being the vendor’s product. “For us, it starts with addressing a business need,” said Steve Weeks of Netcetera, a Vancouver-based Datto partner. “For example, we have a client that wants to put a generator on their roof right now, and we don’t have a vendor yet.”
Client needs should be the main driver when evaluating a company’s technologies. “Don’t even look at the margin. You want the product that provides the most value to customers,” said Weeks. “Give them the product that best suits their specific needs.”
Once you’ve confirmed that the product or products you’re reviewing address the needs of your target audience, IT service professionals should assess based on reliability, ease of use, performance and maturity. User forums and channel networking events are a great place to start searching for reliable product feedback - who better to learn from than those who’ve experienced the product first-hand? Speaking with people who use the product regularly is a great way to get unbiased information about it. They will tell you how the product performs in the real world, what the product does well and where it falls flat. They’ll also tell you about their experiences working with the vendor. For example, if they’ve had problems with a vendor’s tech support, they’ll be more than happy to let you know.
“Networking with peers is the best way to vet products and vendors,” said Weeks. “I meet with a group of IT providers semi-annually to discuss what’s working and what isn’t. This information sharing is essential when selecting a vendor. How is their support, sales, etc? Talking to someone who has first-hand experience is the best way to get the information you need.” MSP groups, such as HTG, are a great way to meet and learn from peers.
Kyle Etter of Computer Integration Technologies, a Minneapolis-based Datto partner, said that he starts with online research and networking with peers. Once he’s narrowed down the search, he schedules an initial conversation with the vendor and then a hands-on test. “We attend all of our partner conferences: Connectwise, HP, Dell, Datto,” he said. “It’s a great way to open up dialog with other IT providers. I also work with Datto’s Advisory Board, which is helpful for all involved because everyone has similar businesses and challenges.”
Make sure to consider whether or not a product is designed with managed service providers in mind. After all, the best products for MSPs are often the products designed for MSPs. This is not to say that you must only use products designed specifically for MSPs, but these solutions may be more in line with your needs. “I definitely prefer a turnkey solution. I don’t want to buy a piece of the puzzle,” said Weeks. “For example, part of the reason we partner with Datto is because it’s an end-to-end solution for MSPs. That takes some of the risk off of us. If you build it yourself, you don’t have that safety net.”
According to Etter, it is important that the product is geared toward MSPs from a pricing perspective as well. “Look at the cost structure of the program,” he said. “If you need to make a large capital outlay at the start, that can be a hinderance to getting a program off the ground. Some vendors require you to pre-purchase licences and hardware, and invest in training up-front. Then you are in the red before showing a profit. More gradual is better. Less of a commitment.”
Finally, search for a vendor that is truly willing to partner with you. According to Weeks, the relationship should be mutually beneficial. “It should be a partnership not just ‘will this retire quota?’” he said.
This is just a bit of what we have to offer in our new eBook: Vendor Relations Made MSPeasy. If you're looking for more information on technology evaluation, contract negotiable, key features of a best-in-class partner program and more, then download the eBook today!