Tell me about how HP deal registrations work
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Not really. Both are important. They're not mutually exclusive. I have two or three preferred VARs, carefully selected because of their winning combination of price and service. I'm monogamous when it comes to women, but not VARs. If anything, I believe I get better service when the VARs know that my business isn't guaranteed.
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@Carnival-Boy said:
Not really. Both are important. They're not mutually exclusive. I have two or three preferred VARs, carefully selected because of their winning combination of price and service. I'm monogamous when it comes to women, but not VARs. If anything, I believe I get better service when the VARs know that my business isn't guaranteed.
Having worked on the other side of the fence, I guarantee you do not get the best service compared to their loyal, trusted customers. We get so much better deals and service when our partners know that we are partners, not customers. It's a totally different world how things work when you are a team. Our VARs know that their business is not guaranteed too, but they also know that we aren't playing VARs against each other to get to the lowest price, we put value on the service and they know that they get to keep providing that service by doing a good job consistently.
If you split between several, you also eliminate your volume advantage with all.
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I've worked on both sides of the fence, and still do.
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@Carnival-Boy said:
I've worked on both sides of the fence, and still do.
So you understand that not having to compete for customers but having an open, trusting relationship and larger volume provides for more opportunity to do good work. It just enables more. It provides better trust, partnership, information sharing, cost advantages, efficiency, etc. There's just no way to keep margins as lean as possible without that monogamous, trusting relationship.
For example, the quote process alone means that if you have three vendors that you go to, each has to quote three times. If that is twenty minutes of work to generate a quote (which is reasonable for a simple order) then you turn twenty minutes of labour into an hour. So if $20 of cost of each purchase goes into the quoting process then for someone shopping around it has to be $60. That's three times the unavoidable overhead.
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We actually reduce that further. We rarely get quotes, we just order. A good relationship means that you can do that stuff, no need to verify quotes ahead of time. So our back and forth is reduced allowing that $20 overhead to get knocked down a tiny bit, maybe to $15 and the process to move much faster.
There is a reason that we can get really good prices on hard to get parts and have them in our hands in two hours while others struggle to get quotes in a day and still don't get the same price that we get.
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@scottalanmiller said:
@Carnival-Boy said:
Same here. Sounds like you should move to the UK where you're not locked in and can shop around.
Doesn't that cause VARs to be far less likely to do a good job? Once you shop around, you are going for low price, not service. If you value service, you go with who has been giving you good service. Once you start shopping around, the VAR drops the VA and becomes a reseller and all responsibility is gone.
You can't shop around and expect the value add, the two are exclusive.
This is a double edged sword. According to this logic if I'm paying $800/month for fiber ISP for X bandwidth, and it's not having any issues, what you're saying is that I should never shop around looking for a better deal. Of course if I didn't I wouldn't know that additional competition in my neighborhood has causes prices to have lowered and I'm just the idiot who continues to pay the high price.
Places like CDW come to mind. I bet they used to have really good prices, and only offer what people really wanted, when they wanted it, but now days their prices aren't that good. So if I don't shop around I won't know that.
I believe in real capitalism - supply and demand. One company makes a great product, starts ratcheting the price to high, so someone else comes along and makes the same, or nearly the same for lower, while still making a profit, etc etc until the price basically hits the lowest price that makers are willing to sell for while being the highest that the consumer is willing to pay.
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@Dashrender said:
This is a double edged sword. According to this logic if I'm paying $800/month for fiber ISP for X bandwidth, and it's not having any issues, what you're saying is that I should never shop around looking for a better deal.
An ISP is not a business partner, nor is it an VAISP. It's a utility service and not related to the discussion at hand.
I've said many times that you absolutely shop around resellers, but not VARs.
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@Dashrender said:
Places like CDW come to mind. I bet they used to have really good prices, and only offer what people really wanted, when they wanted it, but now days their prices aren't that good. So if I don't shop around I won't know that.
No but they famously provide terrible service, so you should have been shopping around not to get a lower price but to get a good value in that case.
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@Dashrender said:
I believe in real capitalism - supply and demand. One company makes a great product, starts ratcheting the price to high, so someone else comes along and makes the same, or nearly the same for lower, while still making a profit, etc etc until the price basically hits the lowest price that makers are willing to sell for while being the highest that the consumer is willing to pay.
Absolutely, but you have to include the value of services and relationship. Capitalism applies 100% and it is the very factors that you mention that make long term partnerships and relationships so important - because that's the means to getting the best value.
that does not imply that you stick with bad suppliers, it means you find a good one and you stick with them.
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That service only has real value if you are a volume purchaser. If you're a one off buyer like I am, the VAR is little more than a reseller - I'm not buying enough for them to care.
Considering that NTG doesn't resell, I'm surprised you have these relationships yourself. If your customers don't have their own VAR already in place, of course you can steer them toward a VAR you've used in the past - I guess if you do that long enough and with enough volume, the VAR will recognize your value to them.
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@Dashrender said:
That service only has real value if you are a volume purchaser.
This is not true at all. You are taking your personal experiences that have been a problem, assuming that the issue is volume and then applying that to the category. There are good VARs that take care of you regardless of your volume.
The more volume you can bring the better the relationship can be simply because everyone has more money to work with and more efficiency all the way from you to the OEM Vendor.
But the idea that your small volume means you can't have a good VAR relationship is simply not true.
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@Dashrender said:
If you're a one off buyer like I am, the VAR is little more than a reseller - I'm not buying enough for them to care.
Caring is not the issue. The real problem that comes in is that you fall out of their cache, so to speak. A large volume customer will have a rep that they talk to all of the time and they know each other and know the needs and can have quick, meaningful conversations.
You can have this same kind of relationship if you work through an MSP. I always mention this. Both there are VARs that will take care of you at any volume and there are mechanisms to make sure that your small volume is never a factor to a VAR regardless of point one. I don't think that anyone under a medium sized business should be dealing with VARs directly in any case. VARs are useful when working with large departments or MSPs. VARs are party of your MSP/ITSP ecosystem, ideally not someone you would interact with directly.
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@Dashrender said:
That service only has real value if you are a volume purchaser. If you're a one off buyer like I am, the VAR is little more than a reseller - I'm not buying enough for them to care.
Same here. But even with volume, if a VAR has a customer that it knows will never shop around and will only ever buy from them, it's natural that that VAR might get a little complacent over time. A bit of loyalty is ok, but you also need to keep them on their toes. It's like marriage, can you honestly say you always treat your spouse as well as you did when you were just dating, or do you sometimes take them for granted. If my VAR doesn't buy me flowers any more, I might start flirting with someone else.
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@Dashrender said:
Considering that NTG doesn't resell, I'm surprised you have these relationships yourself. If your customers don't have their own VAR already in place, of course you can steer them toward a VAR you've used in the past - I guess if you do that long enough and with enough volume, the VAR will recognize your value to them.
We are an ITSP and an important part of our value catalogue is handling these relationships for them. Many customers want to deal with their VARs and resellers on their own, that's fine. But the best value is when we are tasked with that because we can handle the entire relationship end to end. That's why we are a partner with the vendors as well. Let's take Dell as an example...
Our best customers (that want to work with Dell) work only with us. They have us interface with the Dell VAR (we use xByte which is no secret) but we are also peer partners with Dell. We have access to both xByte and Dell with incredibly good relationships with both. We can get things done, we have insight into the supply chain, the road map, etc. We are able to get NDRs that customers cannot, we have conversations and information and pricing that customers cannot get. We provide a lot of value in having trusted VAR relationships so that our customers have the options to never have the kinds of problems that you have described. We keep the overhead low, the volume high and the relationships strong so that little customers can get the value of a big ecosystem.
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@Carnival-Boy said:
@Dashrender said:
That service only has real value if you are a volume purchaser. If you're a one off buyer like I am, the VAR is little more than a reseller - I'm not buying enough for them to care.
Same here. But even with volume, if a VAR has a customer that it knows will never shop around and will only ever buy from them, it's natural that that VAR might get a little complacent over time. A bit of loyalty is ok, but you also need to keep them on their toes. It's like marriage, can you honestly say you always treat your spouse as well as you did when you were just dating, or do you sometimes take them for granted. If my VAR doesn't buy me flowers any more, I might start flirting with someone else.
It's also natural that they might worry more and more about their bread and butter leaving. Complacency is indeed a risk. One we watch out for, but one we have not experienced from good partners.
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And sometimes the only way to find a good partner is to shop around. Otherwise, how do you know if your existing partner is giving you a good price, if you only ever buy from him and don't even get quotes?
I'm surprised you're so trusting of VARs, because on other threads it seems that you think everyone is out to rip you off and you should never trust anyone.
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@Carnival-Boy said:
I'm surprised you're so trusting of VARs, because on other threads it seems that you think everyone is out to rip you off and you should never trust anyone.
Because I empathize with what they do and how they make their money, never go to them for services outside of the scope that they are supposed to be working it and make sure that I know what they are incentivized by. I don't say that you should not trust resellers, I say that you should not go to them for advice, those are very different things. I trust resellers the same as anyone else - when I'm not violating the social contract that they are there to sell me things that they have and that they will attempt to do so. Because I never give a VAR an opportunity to sell me something that I don't need, I don't have any of those kinds of issues.
Our VARs get told what to quote and the scope is kept appropriate. Our relationship with vendors is so good that we've had vendor management actually pull sales people out of conversation chains because they found out that they were trying to make a pitch to a customer of ours. They don't get to do that. They know that their relationship with us depends on them sticking to the rules - and that is no recommendations.
I've said many times, I trust sales people completely. Trusting them and being able to get advice from them are totally different things. I trust the salesperson to try to sell me what they offer.
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@Carnival-Boy said:
And sometimes the only way to find a good partner is to shop around. Otherwise, how do you know if your existing partner is giving you a good price, if you only ever buy from him and don't even get quotes?
Because price is not the important piece. Service is. I keep saying that if we are always talking price, we should not be dealing with a VAR, just a reseller. If you feel that price is the driver and that the products are a commodity then talking to a VAR makes little sense.
I'm not saying that you should never, ever price check, but doing so is quite easy. We talk to customers, for example, who buy directly all the time and have very good ideas as to prices on a wide range of products. We don't have to pressure vendors to run through a quote process just to research prices in all but the rarest cases.
And remember, for us, we are also a VAR on paper. We don't sell anything, but we have the components in place to do so, so we can look up prices just like any other VAR can.
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Adding a MSP or ITSP to the pile - how does this not add even more cost? I suppose you could say that because the MSP brings so much volume to the VAR, the VAR gives better pricing to the MSP than I could get direct.. and that savings is what pays the MSP. I suppose that could be true with an MSP, because they are selling you the hardware themselves. But the ITSP, the customer is paying you to manage that, at your hourly rate, which seems so more likely to be more than the savings difference between what I can get for a product and what the MSP can get it at. Granted I'm getting the MSP rate directly, but I'm paying you to manage that relationship/quote building, etc - that requires a fair amount of time, aka costs in billable hours, no?
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@Dashrender said:
Adding a MSP or ITSP to the pile - how does this not add even more cost? I suppose you could say that because the MSP brings so much volume to the VAR, the VAR gives better pricing to the MSP than I could get direct.. and that savings is what pays the MSP. I suppose that could be true with an MSP, because they are selling you the hardware themselves. But the ITSP, the customer is paying you to manage that, at your hourly rate, which seems so more likely to be more than the savings difference between what I can get for a product and what the MSP can get it at. Granted I'm getting the MSP rate directly, but I'm paying you to manage that relationship/quote building, etc - that requires a fair amount of time, aka costs in billable hours, no?
Correct, but someone has to do that. Whether you or the MSP.... the difference is if you are using an ITSP/MSP as I recommend in a small environment, none of that comes up because it is far less work to have them do everything than to have any handoffs back and forth. Assuming that the MSP has to determine what to buy, how to get it, install it, etc. the cost of them doing the VAR management is offset by the savings in the efficiency of the entire system end to end - it would easily reduce the total time spent by the MSP. Plus, larger MSPs would have lower cost staff to do that, not engineers.
