Home business ideas for transition out of 9-5?

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

@Minion-Queen said in Home business ideas for transition out of 9-5?:

NTG uses a VAR when needed to get things for our customers, but they never purchase directly through us, they purchase from the VAR.

And is getting a finder's fee or whatever from the VAR also verboten to a consultant, I presume?

I like how all these new terms come up.... lol. Affiliate, finder's fee, kickback. It's just sales commission however you put it.

Yes, that too is verboten no matter what word is applied. With our largest VAR, our customers do know that while we don't get a commission, by using them they do (voluntarily) join our buying group for volume discounts. So we all get discounts together by raising our collective volume. But it's a cooperative, not a commission structure.

scottalanmiller

@Dashrender said in Home business ideas for transition out of 9-5?:

Are we saying that people who DO the work and have to buy the solutions can do this but it's only the consultants we have to worry about?

Yes, that was stated above.

I'm unclear what is meant here. Basically if you are paid to give advice, you can't resell without it being a problem. If you don't give any advice and just press the buttons that someone else tells you to press, you can resell, sure, because you are not doing anything that involves selling advice.

Problem is, implementers in IT normally give a lot of advice, even after the initial consultations. IT isn't a mindless button pushing job, in general.

Dashrender

@Minion-Queen said in Home business ideas for transition out of 9-5?:

We have small companies that hire NTG for consulting.

I did. I wanted a whole plan of how to install configure, setup a FreePBX system.

scottalanmiller

@Dashrender said in Home business ideas for transition out of 9-5?:

@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, because as Scott mentioned earlier, it's really hard for the owners to not realize how much money they can make on kickbacks and in the end start putting pressure on their consultants to only offer solutions with their kick back partners.

Scale makes a huge difference here too. You as a single person might, MIGHT be able to not allow the kick backs to influence you.. but as a company... the owner isn't a consultant.. he hires consultants... the owner wants to make money.. see above.

I actually think that a larger company makes it easier, because if they truly care, they could mandate some things that would help a lot in reducing the influence (actively forbidding commissions, ensuring that there are no reports typing people to sales, not telling people who is an affiliate, etc.) It would still have bias, but a larger company could enact more of a barrier.

scottalanmiller

@Dashrender said in Home business ideas for transition out of 9-5?:

@Minion-Queen said in Home business ideas for transition out of 9-5?:

We have small companies that hire NTG for consulting.

I did. I wanted a whole plan of how to install configure, setup a FreePBX system.

And if we sold FreePBX, Yealink phones, voip.ms SIP lines, Sangoma cards, or whatever else we recommended (I have no idea on specifics, even if I was the one that did it, i just don't have that kind of memory) it would have been a conflict of interest, no matter how small it was.

scottalanmiller

@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

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.

Most places that are Dell partners, they plaster that fact all over the place! so it would be near impossible for the consultant to not know.. and your customers would know too, because of the plasterings... so at that point you stop being real consultants, and instead become VARs for Dell.

Not all Dell partners can resell. We are non-reseller Dell Partners specifically because Dell respected our choice to be consultants, not vendor representatives. But both we and Dell wanted us to have VAR-like internal resources for support and such because we have too much value to add for the customer.

We bring the VA without the R.

scottalanmiller

@guyinpv said in Home business ideas for transition out of 9-5?:

You are applying false motive here. It's assuming that the only reason I pick a product is BECAUSE I get kickback. ..... If such pure objective work is so important. If so, enjoy paying your $200/hr fee to basically end up with recommendations for Dell and Microsoft anyway.

In one case, you are assuming that the kickbacks don't drive the solution. But then you assume that one contrived solution that mostly only exists due to reseller kickbacks is the only one that will survive. This doesn't add up.

If you think that consultants that don't resell are always coming back with the same basic answers I think you are dealing with resellers and they've been hiding this from you. As a consultant, I can tell you that no two customers are the same, ever. It seems like they will be, but they never are. Each is very unique. Real consultants don't end up with cookie cutter solutions at all. Sure, get big enough, do similar enough companies and maybe some patterns will start to emerge, but rarely and only on the surface.

If you have a true consultant doing their job, this won't happen at all. Hence why we keep pointing out that affiliate programs based on a "normal case" are false hope. There is no such case. Not for home users, not for business.

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

@JaredBusch said in Home business ideas for transition out of 9-5?:

@BRRABill said in Home business ideas for transition out of 9-5?:

I, personally, do not think I understand what a true consultant delivers. I mean, if I go and ask for a server, correct, how many different types of servers are there?

You do not hire a consultant if you know you need a server. you go to the vendor or VAR.

You go to a consultant to determine the best server for your needs.

But that is the point I think @guyinpv is trying to make.

His customers come to HIM and say "I want a server". They trust him to pick the best solution for them.

If it was ME, I'd ask a ton questions first ... do you really need a server? being the first.

For example (and keep in mind this is NOT my line of work, doing this sort of stuff) a non-profit comes to me recently, with 3 users, and really, really says they need a server. I immediately explain why they don't need one. And I've been arguing back and forth with them on it. They are adamant they need one.

Good example. If you were getting paid to sell servers, you'd be much more likely to just do what they think that they want rather than actually trying to consult and help them.

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

@guyinpv said i

People who contact me, they aren't thinking at this level, they just want it done, fast, cheap, now.

Same here.

And while some will say that's why they are small business and will never grow, it is what it is.

That's great. They want a VAR

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

Really, what the difference as @guyinpv has said between charging $400 to say buy DELL, and just knowing that 9 out of 10 times they need a DELL?

The difference is determining if they are the one time out of ten. But what I can't explain enough, is that it is not 90%. It's 20 - 40% at best. Consultants don't see this cookie cutter world. VARs do because they let the product drive the decision, not the need. They take a solution and see if they can make it work, rather than looking for what is best for the client.

So if you word it the way that you do, it sounds reasonable. If you look at it in the real world, it's totally crazy,

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

So, isn't it possible that a person in a smaller shop (or independent) really could provide honest advice, help the customer, and also get an incentive?

I don't see how they could reasonably do so. If they disclose the incentive, then it's perfectly ethical. But the customer is an idiot. If they want "advice" from a VAR, that should be free. Why pay a consultant to act as a VAR?

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

I, personally, do not think I understand what a true consultant delivers. I mean, if I go and ask for a server, correct, how many different types of servers are there?

If you ask for a server, you've already misunderstood how to engage with IT (or any advice driven group.) You are proposing their advice and telling them what to tell you. That's not good. Tell them your problem, let them solve it. Don't lead with the solution.

So how many types of solutions are there? Endless. Servers alone range from $300 to millions. And they come in all shapes, sizes and styles from many different vendors. They come hosted and on premises. They come with different storage, CPU, memory, for factor, purchasing, controller, power supply and other options it's crazy. Many different architectures.

There is realistically nothing in IT that is cookie cutter enough to feel like you could have a stock solution, ever.

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

And if the insinuation is that if a client says "I need a server" and some places sell them a $20K server when they need a $2K server ... well, I have never seen that, and I have never done that. Though, I guess I have seen it because a lot of times I'll come in to help when they've been oversold already. But I would not do that.

A consultant is a lot like a psychologist.

Customer: I need a server.
Consultant: Why do you feel this way?

Consultants help, we hope, to determine what the need is. Consultants very rarely oversell, they are paid specifically not to. If someone is getting oversold, while it's not absolute proof, in reality you know that it was a VAR taking advantage of someone and selling consulting hours and using a salesman.

BRRABill

I haven't posted in this thread in many hours.

Yet I still see my name coming up!

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

Or is this really all about semantics?

In that what @guyinpv is describing is a VAR, and there is nothing wrong with that?

I mean, do people not think someone is making money on the hardware? DO people think it all gets passed on for free? Like it costs DELL $250 to make the server, and that is what the client will pay? I think everyone understands markup and its place in business.

Being a VAR is fine. Everyone knows that there is profit. But Dell doesn't sell you advice. The first that there is money to be made selling is not relevant. The issue is that you can't be both the buyer's agent and the seller's agent without compromising something.

scottalanmiller

@BRRABill said in Home business ideas for transition out of 9-5?:

I haven't posted in this thread in many hours.

Yet I still see my name coming up!

I'm still like 100 posts behind!

guyinpv

@BRRABill said in Home business ideas for transition out of 9-5?:

@Dashrender said in Home business ideas for transition out of 9-5?:

@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.

I think this is the takeaway from this massive thread.

That's the takeaway?

I wish the takeaway were some actual definitions and viable business models!

Scott suggests that so much bad IT, so many bad companies, so many biased recommendations, are due only to partners and affiliates being used. And that many of these also "scam" because they don't disclose when they recommend something with a kickback.

I want to point out some things.

All these companies and vendors have affiliate programs for a reason. WHO are they meant for? They aren't meant for the end users, since they can't get kickback for buying their own products. They aren't for resellers, since I can't buy a Dell laptop and put it on my shelf and resell it with markup and affiliate bonuses coming back to me (in other words, stores).
The affiliate programs are precisely designed FOR IT people to use, and specifically for IT people who are implementing solutions FOR clients, i.e. clients making purchases through affiliate links/partner programs recommended by their trusted service provider.
We can't simply conclude that all these programs are just evil. This is what they are FOR, for IT servicing companies. It's FOR them. But if the company uses it, they are sleazy? Yes yes, they can disclose the kickback, but that doesn't change the opinion that they are still a sleazy company, mastered by affiliates, beholden to vendors and not their clients, they are not IT people, they are sales people, etc etc etc.

Apparently one cannot have it both ways, you cannot use an affiliate program and NOT be a salesman at the same time. I reject that idea though personally. I could easily be a salesman for a company even without a kickback. Maybe a friend works there? Maybe I'm trying to be impressive and get a job there? Maybe I just know the product the most and push for it by default? Maybe a lot of things non-monetary, I can still be a shrill for them. Likewise, if there is the presence of monetary gain, it does not necessarily mean I'm their salesman. Maybe I have the affiliate program because it's easy to sign up for, but I don't particular like the product and rarely push for it due to many other negative biases? But in the event it really is the best choice, the bonus happens to be there.

It almost seems like affiliate programs should not exist at all. Because their very presence, or availability, for IT companies to use (for which the programs are create for in the first place), automatically makes those companies sleazy sales companies. Just a VAR, picking through a catalog of affiliates pushing for the highest kickbacks. Nothing more.

There does not seem to be any wiggle room whatsoever in human nature or ethics for an IT company to use the affiliate programs created for them to use, but also be considered a fair, objective, quality IT company. They are automatically suspect, biased, serving two master, overselling, and dangerous. Maybe even illegal!

What option is left for a company to who wants to BOTH be a high quality IT company, AND be a "real company" who must think of profits, AND can do objective work, providing the best solutions, AND thus take advantage of affiliate programs clearly created exactly for them by almost every vendor, which is essentially just free money when those vendors are purchased.
What option is there for them to be respectable, quality, service providers?
How an affiliate kickback any different than aiming for a bulk discount? Group buy? Combo/bundle purchase? There are lots of ways to "save" money by being choosy about products and vendors, but none of those are thought of as so sinful over against affiliate commissions.

Will the world be a better place if vendors could not offer any commission programs?

scottalanmiller

@guyinpv said in Home business ideas for transition out of 9-5?:

Scott suggests that so much bad IT, so many bad companies, so many biased recommendations, are due only to partners and affiliates being used. And that many of these also "scam" because they don't disclose when they recommend something with a kickback.

Do I? Maybe I said or implied that, but if I did, I'll correct it. I'd say that so many bad companies choose to take kickbacks because they are already bad. They weren't going to (and often are not even remotely capable of) delivering competent IT consulting so are already working under questionable pretenses. They try to complete with better consultants by lowering the price, but find that they need (or want more money) so double dip. They are taking advantage of customers anyway, so why not take advantage more. Their advice is already bad.

The issue, in most cases, is that they are bad companies with ethics and skill problems from the beginning. The secret reseller thing is just a reflection of that.

That's not to suggest that becoming a reseller doesn't turn a good consultant bad. But the general case, I believe, is that the "consultants" is already not doing what he should and since that is the case, turns to the dark side because really, he's already there.

scottalanmiller

@guyinpv said in Home business ideas for transition out of 9-5?:

All these companies and vendors have affiliate programs for a reason. WHO are they meant for? They aren't meant for the end users, since they can't get kickback for buying their own products. They aren't for resellers, since I can't buy a Dell laptop and put it on my shelf and resell it with markup and affiliate bonuses coming back to me (in other words, stores).
The affiliate programs are precisely designed FOR IT people to use, and specifically for IT people who are implementing solutions FOR clients, i.e. clients making purchases through affiliate links/partner programs recommended by their trusted service provider.

THey are for anyone willing to get paid for pushing a product. It's no more complex than that. VARs, consultants wanting to double dip, internal IT running server buying scams on their bosses... legit or not, the vendors don't care. You sell on their behalf, they pay you. Easy peasy. Drug lords don't sell to local drug pushers to sell in specific ways or specific customers. They pay them for selling drugs. To whom, how or why isn't relevant.

You are implying that because one company will pay people to sell, that all people who sell are then blameless because someone paid them. That's like the argument that software must be legal for the assumed use case because someone was allowed to sell it, ignoring the fact that there is a perfectly legal use case that the users are just ignoring. The users were still stealing software.

scottalanmiller

@guyinpv said in Home business ideas for transition out of 9-5?:

Apparently one cannot have it both ways, you cannot use an affiliate program and NOT be a salesman at the same time.

Exactly. I read this as "Apparently someone can't be a salesman and not be a salesman."

Logically, that's correct. Calling someone an "affiliate" is not a thing, it's just another term for salesman.