Updated: Sep 9, 2020
In our constantly evolving and fast-paced industry, businesses are increasingly moving to independent technology agents and IT consultants instead of siloed direct sales reps. There are a number of factors as to why this is happening. In this article, we will examine the Top 7 Reasons why businesses are moving from direct sales to an indirect channel sales model.
1. Single-Point of Contact
Having a single point of contact to recommend information technology (IT) solutions and providers is becoming increasingly important to CIOs, CTOs, and IT Directors and Managers. This is highly valuable to IT departments that are focused on managing the day-to-day technology demands of the business. A single-point of content helps IT source providers and vendors for their projects and streamlines the communications process by filtering the back-and-forth phone calls and emails from multiple sales representatives from different providers.
Many service providers and authorized resellers see a high turnover when it comes to their sales reps. On the other hand, an independent agent will be there to support your project from start to finish. Their business and livelihood depend on it. Subsequently, technology agents will be there to support your account after the sale with an account management team to assist with customer service issues, trouble tickets, billing issues, and escalations.
2. Unbiased, Independent Approach
It’s the job of a direct sales rep to sell the products and services that only they offer through their employer. After all, direct sales reps are pressured to hit their monthly sales quota and are compensated by commissions, bonuses, and SPIFFs when they are successful in selling the products and services they represent. Therefore, they have every reason to sell as much as they can to their prospective and existing clients to boost their numbers.
Unlike direct sales reps, independent technology agents like Netari represent over 300 service providers and vendors. With hundreds of providers and an almost unlimited amount of solutions to offer, independent agents are client-centric (versus quota-centric) and focused only on finding the right technologies and provider(s) for their clients based on client-specific requirements. Independent agents do not need to push unnecessary products or services or solutions that are not the right fit for their clients.
3. Technology Solution 'Price-Parity'
There are a lot of misconceptions when it comes to the indirect sales channel. A major misconception is that you will pay more when you go through an independent agent than going direct. Most direct sales reps and even some businesses believe that there is a markup or margin added to products and services sold in the indirect sales channel. This simply isn't the case.
If you look at the economics of direct sales, you are likely to see how expensive it is to employ sales reps. For example, overhead costs such training, salary, benefits, bonuses, commissions and related expenses such as office space are necessary to support internal sales departments. Turnover only adds to the cost.
With the indirect sales channel, independent agents are paid commissions only after successfully providing the client with the right technology solutions for their business. Subsequently, technology agents do not receive commissions until after the client’s project is successfully completed and operational. This can be months after the sale.
4. Customized, End-to-End Technologies
At the end of the day, enterprise IT is highly complex, involves a lot of moving pieces and is a giant puzzle. We are talking about business phone systems, unified communications platforms, wide area networks (WAN), business internet, cloud servers, data storage, and backup.
Independent IT consultants and agents can train on all of the latest technologies by the service providers and vendors they represent. Master agencies like also have in-house Solution Engineers to assist in highly technical, technology solution design and architecture. They can use a multi-vendor approach to build a highly custom, end-to-end technology solution for your business. This is especially important for businesses with multiple locations in different cities in the U.S. or around the world.
5. Highly Experienced IT Professionals
If you look at the indirect sales channel and its agents, you will see that a large percentage have worked in the industry for 15-20 years and for multiple service providers and vendors. In fact, most agents have worked for at least two telecom carriers, ISPs, MSPs, or network providers.
The benefit of using an independent agent is that they have the experience to ensure that you get the right technology solutions for your business. They also have insight into the strengths and weaknesses of each provider from a pricing, product and service, and support perspective.
6. Project Management Capabilities
You have narrowed down the technology product, service, and provider for your project. Now, all that’s left is installing it and integrating it with your other technologies. It’s never easy installing a new business phone system, internet circuit or deploying a network to all of your branch offices or headquarter locations. Project management involves weekly or bi-weekly calls with the provider to check-in on the progress being made as well as timelines and costs.
When you go with an independent master agent, you have access to a fully-staffed back office that will sit in on project management calls and help manage the process in the right direction. This is an additional layer of support that going direct simply does not provide. Your agent will also be on the conference calls to ensure things are progressing as they should.
7. Ongoing Account Management
Employee turnover at all of the major telecom carriers, ISPs, network and other providers is inevitable. Many direct sales reps and account managers jump from provider-to-provider and job-to-job. There’s a great deal of turnover in the industry. The account manager you have today could easily be gone tomorrow.
As mentioned earlier, independent technology agents are reliant on retaining their clients for the long-term. It’s their entire business and livelihood. As a result, independent agents are highly focused on providing the best customer service and support possible. This includes performing regular account reviews with the client and staff to resolve any issues and learn more about how the solutions and providers are performing. They’re here to alert clients to expiring contracts and renewals as well as areas where your business could save money on their technologies.
8. Customer Service Escalations
Service outages or disruptions are two words that IT Managers and direct sales reps do not want to hear. When businesses go direct and they have an issue with their service, they typically are routed to the customer service call center for all of the provider’s business customers. This process can take hours to get a trouble ticket resolved.
By going through the indirect channel, an agent can often use their relationships with the provider or vendor to drive visibility and resolution more quickly. Instead of using the traditional channels for customer service, an agent has access to a different customer service team members and can escalate up the indirect channel to the highest levels.
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