Home business ideas for transition out of 9-5?
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@guyinpv said in Home business ideas for transition out of 9-5?:
@Dashrender said in Home business ideas for transition out of 9-5?:
@BRRABill said in Home business ideas for transition out of 9-5?:
@Dashrender said
Then do the even better thing - tell that customer - hey as an FYI, if you buy this chevy, chevy is sending me $20 - just an FYI. Why don't you want to do that?
Because then the client would want that.
Is the argument here just to charge more up front for consulting, and ditch the reseller fees?
If you need that money, then yes! and see - we are right back to what motivates you? Money does, because you want that $20 bucks.
No, the $20 is simply FREE for the taking, so why pass it up?
Because it's pay for sales.
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@scottalanmiller said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
It is correct, we don't know each other, you don't really "know" the consultant you just hired. So do you ask them before any work is done, "if you are on commissions or use affiliates, I can't work with you?"
It's good to ask, but it is required that they tell whether someone asks or not in a situation where it applies.
For example, what if I resold Netgear equipment. I do consulting and I recommend Dell equipment. I need not disclose that I had a bias away from Dell. I probably should, but I don't have to. But if I consult and recommend Netgear, I must disclose that I'm getting paid to make that recommendation. I can explain why I'm not overly biased by that, but I must tell them, every time.
Disclaimer: I do NOT sell Netgear. It's an example.
Ok but what if you're NOT getting paid to "recommend" them? In fact you're not even getting paid to implement them. You're not getting paid if the customer goes and buys the equipment themselves and hands it over to you to install. You're not getting paid (via affiliate) to buy the product yourself and resell it and add it to the invoice (in affiliate programs you can't buy the products for yourself and resell to get the kickback).
So the ONLY way you get paid any bonus for anything is if the client buys the stuff themselves by using your affiliate/partner links, which they are free to not use.You might "think" you are biased toward Netgear but in reality there is a huge chance you'd never get the bonus if they want you to buy the stuff yourself, or they have someone else install, or they run to Costco and get the model there, or from their Staples or OfficeMax accounts, or BestBuy credit, or Newegg Business, or Amazon Prime accounts.
You have no guarantee you'll ever see that affiliate fee come pay day, so how much is it really affecting your consulting?@scottalanmiller said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
It's the same thing, you don't know them, so find out. Or DON'T find out, and put blind trust that they are objective.
Caveat Emptor is great life advice, but very bad for a consultant to use as their own motto. This suggests the idea that the consultant in question is the enemy of his clients and out to get them, rather than doing their job and working for them. Of course, clients SHOULD question everything and audit their consultants. But consultants should also make customers not have to.
Don't be the consultant that proves why the customer should have been wary. Be the one that rewards their trust.
The assumption is, again, that possibility of some affiliate bonus completely and utterly destroys all objectivity and they could no longer ever hope to provide good advice. It's a pretty big stretch.
The objection is that I don't think I am "out to get my clients" because I affiliate with some of my top recommended, nearly industry standard, vendors.@scottalanmiller said in Home business ideas for transition out of 9-5?:
@BRRABill said in Home business ideas for transition out of 9-5?:
So a sales person could be suepr technical, and really know how to implement something. But if they do that for free and only make money from the sale ... they are 100% a salesperson?
Wouldn't that be a VAR?
Correct and correct. People who are compensated through sales are salespeople. Whether they make sales by buying you a drink, showing some cleavage, knowing their product, having a low price, being in the right place at the right time or adding in some incentivized advice... they are sales people.
The assumption here is that the commission is their SOLE income, commissioned sales is not the sole income of someone who occasionally offers affiliate links. The pressure to upsell/oversell push the highest priced stuff only makes sense when the commission if the main source of income.
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@scottalanmiller said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
But I don't see myself as the "reseller" part. I don't resell, I just throw out a link and tell them this is my partner link, if you want to give an extra tip. No pressure.
This is how I read this....
I don't see myself as a reseller. I just resell.
Um... what?
I read the term "resell" as that I buy the product myself and resell it to the customer, perhaps with markup. Or that I use white-label products and rebrand it, resell, with markup.
I don't see how an affiliate link is "reselling".
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@scottalanmiller said in Home business ideas for transition out of 9-5?:
@IRJ said in Home business ideas for transition out of 9-5?:
@Dashrender said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
@Dashrender said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
They have zero say in the final analysis. I don't send them the estimates and invoices, they don't send me anything. If their product happens to be the right solution, then a bonus is there.
Here's a question - Why do you deserve the bonus? You did a job, you were paid for that job - consulting fee. Why do you deserve a bonus for doing that job? Why doesn't the client deserve a discount instead?
Excellent question.
In previous jobs for some residential clients or non-profits I literally gave them extra discount for using the affiliates.
Don't misunderstand me, I literally have 3 affiliates to my name. Amazon, InMotion, and I think VULTR. I signed up BECAUSE I love them, not because of wanting the most kickbacks. I only think of it as free money. But obviously this raises a lot of ethical questions for people.
Again, this isn't about you - this is more - would some stranger think you're taking advantage of them... if they paid you $50 for an opinion, and if they buy a product on your opinion list you get affiliate kickback money - will they be OK with that? it's about what the other guy thinks.. not what you think.
Hell I think the "for Dummy's" series is a horrible name the first time I saw those I thought it would tank.. what the hell do I know? Look around today, there are dozens of 'for Dummy's' books, clearly other people thought the name was catchy, and it worked.
If somebody says my service is $250, but if you buy from Amazon, I will only charge $235 sounds really sketchy to me.
Sketchy, but honest. So not unethical. But certainly weird and/or sketchy.
Sketchy is not a nice feeling to save $20
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@guyinpv said in Home business ideas for transition out of 9-5?:
@scottalanmiller said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
But I don't see myself as the "reseller" part. I don't resell, I just throw out a link and tell them this is my partner link, if you want to give an extra tip. No pressure.
This is how I read this....
I don't see myself as a reseller. I just resell.
Um... what?
I read the term "resell" as that I buy the product myself and resell it to the customer, perhaps with markup. Or that I use white-label products and rebrand it, resell, with markup.
I don't see how an affiliate link is "reselling".
Fair enough. It's selling, not reselling, technically. You would be a seller or VAS. But people just call it a reseller when someone does this. It's incorrect, you are correct. Reseller is a sloppy term, but industry standard, whether you resell or just coordinate and get paid for the process. 99% of resellers don't actually resell. That's actually quite uncommon outside of little stores. When IT people say reseller, they don't mean people who buy and resell (but don't rule them out, either.)
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@guyinpv said in Home business ideas for transition out of 9-5?:
I don't see how an affiliate link is "reselling".
It's basically identical to being a Dell Reseller. If you are a Dell reseller, you are really only an affiliate. Affiliate is the most common reseller model.
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To be fair here, nobody has ever hired me for pure consulting. I have a feeling this is only something larger companies do who are facing huge budget, big ticket items and don't want to be screwed. Projects which may span pages and pages of requirements and require a ton of business intelligence and research.
This leaves me with only one conclusion to all this mess.
On one side you have pure, unadulterated "consulting" which must be absolutely objective and bias free in every way possible. Also, where the consultant or consulting company will not be implementing the solution or selling/reselling/linking to the products.
On the other side, is EVERYTHING else, which must needs be called VAR since they are no longer consulting, but are being paid to implement solutions and fix problems.
Am I on track here? Consulting, and VAR are the only two options? Perhaps "solutions provider" could be thrown in as a synonym?
I don't see any wiggle room for "consulting + implementing" as this breaks the absolute unbias rule, thus it's not consulting, just VAR and biased opinions. Therefore, either someone is consulting, or they are a VAR, with no grey areas.
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@guyinpv said in Home business ideas for transition out of 9-5?:
To be fair here, nobody has ever hired me for pure consulting. I have a feeling this is only something larger companies do who are facing huge budget, big ticket items and don't want to be screwed.
Nope, we get it from small companies all of the time.
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We have small companies that hire NTG for consulting.
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@guyinpv said in Home business ideas for transition out of 9-5?:
On one side you have pure, unadulterated "consulting" which must be absolutely objective and bias free in every way possible. Also, where the consultant or consulting company will not be implementing the solution or selling/reselling/linking to the products.
Implementation is part of consulting in most cases. There IS a conflict of interests, but it is not the same as the reselling one because it is a preselected vendor scenario. There is nothing to hide, there is no means of hiding it.
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Those same companies also hire us to implement about 50% of the time. This does not include selling them anything. We always lay out choices for them this is the one we like and here's why. This is a lesser option and this is our least favorite option. They pick they purchase we install/migrate etc.
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@guyinpv said in Home business ideas for transition out of 9-5?:
Am I on track here? Consulting, and VAR are the only two options? Perhaps "solutions provider" could be thrown in as a synonym?
We actually rarely use consulting as a term. We call ourselves an ITSP. We outsource all the IT functions... which are consulting and implementation.
That's actually a key differentiation... what does an internal IT person do? They tell the business what is needed and they implement it, right? Does the internal IT staff also resell to the company that they work for? Do they use affiliate programs? No, they do not. So it makes for a pretty obvious line as to what is the "IT" tech functions and what is the reseller/VAR functions.
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@guyinpv said in Home business ideas for transition out of 9-5?:
I don't see any wiggle room for "consulting + implementing" as this breaks the absolute unbias rule, thus it's not consulting...
Many companies hire consultants ONLY for the implementation piece. There is plenty of wiggle room because it is all the same IT function.
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@guyinpv said in Home business ideas for transition out of 9-5?:
On the other side, is EVERYTHING else, which must needs be called VAR since they are no longer consulting, but are being paid to implement solutions and fix problems.
There is no good term for the "everything else" piece when sales is included. And it is the majority of the market. IT suffers from this. The average company like this, by far, is horrible. They don't really consult, they are outright scams and they have destroyed the IT industry. There are some that are good, but I'm not sure that I've ever met one. We spend our careers cleaning up after them. The "average" and "majority" positions in this realm are not good places.
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There are two base functions in discussion. IT and sales. They are easy to separate because we all know what IT does. And we all know what sales does. It's paying IT folks via sales channels that makes things complex.
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@guyinpv said in Home business ideas for transition out of 9-5?:
I'm wondering how does this conversation even happen? Where is this information disclosed? How is it stated and yet still appease doubts about bias? Is it from the first minute?
Client: "Hi, I need some consulting, do you do that?"
Me: "Yes, I can help you out, but be aware I might make a finders fee on solutions I recommend, should you use me to implement them."This seems quite....intense.
That's what we do, almost exactly. We make it ridiculously obvious. We make them acknowledge that they understand.
In fact, it works the opposite of how you are imagining. Instead of being like "oh, I can't use these guys" they tend to say "awesome, I'm sure everyone else does that too and just doesn't tell me."
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@guyinpv said in Home business ideas for transition out of 9-5?:
@BRRABill said in Home business ideas for transition out of 9-5?:
@Dashrender said
and Scott has said that this is what NTG struggles with all the time. A huge difference there is that they have consultant, Scott, and they implementors, Gene, etc. Keeping these roles separate enables the consult to remain a bit more unbiased as long as he doesn't know who or what is an affiliate with the company.
But that is ridiculous from the sales side. (If there IS a sales side.) If you were running the sales department, and 4 out of 5 recommendation is from Company ABC, why wouldn't you want to become a reseller?
For that matter, why not get kickbacks from every possible vendor possible?
If sales is completely removed from the consulting process and recommendations, why shouldn't the implementers who are told "do this stuff" use all the kickbacks they can get? Now that the bias part is removed?
Well, I think you have been reading my stuff but forgetting it
I mentioned this before, both how it helps and how it doesn't.If you are going to get kickbacks, you want them from all over (if you are going to consult along with it.) So, like I used in a previous example) if you are doing Cloud IaaS you might do DO, Linode, Vultr, Rackspace, Azure and AWS... right? You don't have to do ALL. You can explain to clients that you don't use Cloud@Cost, for example, because they are crap and you could never recommend them anyway. You don't have to resell everything, just everything reasonable. This eliminates a certain aspect of bias, but only a little bit.
What it doesn't fix is:
- The bias towards selling something, instead of nothing (this is the biggest bias problem we see, the vendor selection bias that we fixed above is trivial in comparison.)
- The bias to sell bigger solutions that necessary.
- The bias to sell the one with the biggest kickback.
It removed a secondary or tertiary bias, so that's good. But recommending a vendor isn't all that important in IT. Think about it, no one pays you to tell them to buy HPE or Dell. That's ridiculous. They pay you to tell them if they need a server at all and reselling all servers doesn't change the fact that you only get the kickback when you sell something, anything.
We see this with storage. Someone might sell 100 different things, but SANs make so much commission that no matter what problem you have, they think that a SAN is the solution because selling one SAN earns so much money that nothing else matters. We often estimate that losing 90% of your clients, but managing to sell SAN to the remaining 10% is a huge financial win for most companies.
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@BRRABill said in Home business ideas for transition out of 9-5?:
@Dashrender said
because it's counter to one of your primary business cores - being a consulting company that gives unbiased opinions.
How can you possibly say you're unbiased if your company sells one of the products you're recommending?Well, in theory these sides never meet. But what I am saying is if the consulting side recommends DELL 80 out of 100 times, and the sales side says, holy cow, we sell a lot of DELL, we should get a kickback, then what's the difference?
Yes, the consultant TECHNICALLY doesn't know if they are a reseller on the sales side, but of course it would make sense.
I would think the a consultant should NEVER sell, or have anyone else associated with them selling.
This would work, I feel, in a situation where you could maintain total air gaps and that the consultants could not find out that you had a sales side. Like if NTG had a secret sales team that would transparently grab sales mid-stream and inject themselves without the engineering team ever finding out. That would be great. But reality is.... customers would mention it, we'd find out and we'd be influenced by the knowledge. Maybe not a lot, but a little. Maybe a lot, depends on the person, I guess.
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@scottalanmiller said in Home business ideas for transition out of 9-5?:
@IRJ said in Home business ideas for transition out of 9-5?:
@guyinpv said in Home business ideas for transition out of 9-5?:
@IRJ said in Home business ideas for transition out of 9-5?:
AH!! This summarizes the entire objection. You guys think the use of affiliates means a person is "chasing", perhaps obsessively, for pennies to screw over clients where the actual money is.
I've been fighting this whole time against this idea. The affiliate thing changes NOTHING. I and probably no one else whose though about this have any intention of screwing their clients and their "pounds$$" over pennies.
Your assumption is that this is exactly what we do. I don't know what else to say. The pennies are literally bonus money on the sidewalk. Just bend over. It's really not hard.
Do whatever you want. We all adults here, but making $20 on the side could ruin your whole business. I know what amazon affiliate links look like as many other people do and it could put your reputation at risk.
Here is an idea. If the $20 is that important to you then just add it on to the bill. No one will complain then.
I doubt that it will ruin his business. Chances are, no one is going to catch him. This kind of thing is super common in IT shops. Getting away with it is easy. Living with it is what is hard. If he can clear his conscious, that's his business. Well, and his clients' business. It's obviously unethical, maybe illegal, but likely to get caught or found out? No way. This is purely about professionalism and ethics, for all intents and purposes. It definitely will help him make a viable business out of the SMB market.
Well, the reality is also that it's likely that the OP will never do real consulting work either - and by that I mean a job where is he paid to do research and present the options for a project for a customer. It's much more likely that he will have clients who come and say - I want a server. Then he is welcome to be a VAR all day long with no ethical/legal concerns.
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@BRRABill said in Home business ideas for transition out of 9-5?:
I would think the a consultant should NEVER sell, or have anyone else associated with them selling.
That's the idea. I think consultants should often have good VAR relationships, but not always. But that's a way that we often handle it. You need the value that a VAR brings to the table, but you don't want to be the one benefiting from the money. But you do want to benefit from the clout and volume. And you want to pass that to the customer (we get better service from Dell than normal consultants, for example, because they know us even though we are not a reseller, for example.)
