Is Sage Bouncing You Around?

Are you one of the Sage partners who received an email today from Accountmate?

The title of the email “Is SAGE Bouncing Your Around?” asks several questions – and implies that Sage doesn’t treat their resellers with respect.

I’m not sure I see where Sage is disrespecting their resellers though I guess the constantly moving tier commission structure is what Accountmate is implying is disrespectful.

I have a different opinion.

I couldn’t care less if Sage (or any publisher) paid me 100% commission on a sale.  The margin on software or maintenance is only covering most reseller’s costs.

What do I care about?

What I am increasingly seeing – and I am VERY concerned – is that customers on locally installed software products expect their upgrades, server moves and all other maintenance work including upgrades (ie – Non Projects) to be performed at a moments notice with no concern to their setup.

And personally I agree with them – to an extent….

The era of consultants getting away with drafting a spreadsheet to quote a customer the cost to upgrade a system or move to a new server is largely over.

Those days will begin to wind down within 3 years.

No longer do customers consider upgrades or server moves magical or worthy of a high level of attention (and expense) and as such there’s very little value placed on those services.

Customers use zero maintenance systems like Facebook and Google and never worry about installing upgrades or bug fixes – so why should they have to worry with ERP or CRM?

I realize there are MANY reasons why the customer DOES have to worry. Especially with customizations or systems with large numbers of users. I get it. There are exceptions.

Increasingly customers don’t understand this. And if as consultants we quote a price that seems high (to their expectations) they’re happy to go find a less successful partner who will cut our pricing in half — or more – and perform the work.

Which brings me to my point….

Any on-premises software publisher can give me 100% margin on everything — but if they can’t deliver a product the customer WANTS then at best they’ve only been able to slow the erosion that I believe we will all see in the on premises market.

Some of us may be able to fight the erosion by cutting rates or doing work for free in order to maintain the illusion that upgrades and other maintenance are effortless. At best we probably are just delaying the inevitable.

Perhaps it’s the same with Accountmate. And I don’t know what their product looks like but if Accountmate’s main argument is better margins — but you still futz with the same low perceived value services (upgrades, server moves) — I’m not sure that Accountmate is worth a look.

Is Accountmate’s call to Sage partners “Hey the 1980’s are back – come on in and return to the way that things used to be”?

Maybe it’s just me but I get calls weekly that go like this:

“Hi Wayne this is XXXX , my IT guy is here. He is putting in a new Windows 2013 server. Can you talk to him? ”

Half the time the customer is 5 levels back on their ERP (or worse they are trying to do year end payroll reporting and have not realized that the publisher no longer issues patches for their old version)….

I believe the true issue we have to deal with is the maintenance of existing systems. In surveys that I read online it’s called Total Cost of Ownership.

Customers don’t want to pay for things like upgrade labor when they deem that feature should be included in the product already (and from my vantage point most do).

As consultants we can collectively bounce from software publisher to software publisher chasing higher margins – but is that truly the problem?

3 Replies to “Is Sage Bouncing You Around?”

  1. ERP customers today and younger and more sophisticated, and they are going to begin demanding (or already have started demanding) software that is low-maintenance, cheap, sexy, in the cloud, and still totally functional. If these publishers don’t keep up (and they aren’t), there are plenty of entrepreneurs who will fill the market with new options. Selling a box is … over.

Comments are closed.