Jola Cloud Solutions' Blog

One of my better decisions in 1996 was to come home from the USA and after 10 happy years with C&W leave in favour of a port-a-cabin start-up on a chicken farm in Leicester. These days the cloud has enabled companies to start-up with little capital investment, renting enterprise-level applications on monthly contracts and allowing staff to work from anywhere. If you can live on your savings for a few months you may even be able to get going without having to sell any of your company to external investors. Reduced start-up costs could be one reason why there were a record 608,100 UK startups in 2015, up 4.5% on the previous year which was itself a record year.

If you are considering taking the plunge, breaking away from corporate life and having a go at working for yourself there will be many thoughts occupying your mind right now so let me add one more.

What kind of entrepreneur are you?

1. Lifestyle

This entrepreneur has turned something they love doing, into a business. They have no immediate plans to sell the business which exists primarily to fund their lifestyle. If they are doing well they will be approached by people who tell them they could be millionaires by expanding, getting new investors or preparing the business for sale. After several months of stress and expense it fizzles out and the lifestyle entrepreneur breathes a sigh of relief. I know many lifestyle entrepreneurs who have learned to be comfortable in their own shoes and resist encouragement to expand or recruit. If you are one, you probably know you are not attractive to professional investors because they need an exit to return a gain to their fund in a specific period. If you need money for growth or new equipment, then borrow it. Interest rates are low and most banks are happy to lend you money if you will give them a personal guarantee. There is also a government-backed scheme, offering loans of up to £25,000 at 6% interest.

Internet bandwidth is getting cheaper and faster and as a result, revenues from business cloud products are growing quicker than ever before.

Most voice resellers and IT support companies that were not already selling connectivity, cloud voice and mobile SIMs are now actively looking into it, either to protect their customer bases or to add valuable recurring revenues and margins.

Unless you intend to build your own network and switches you will probably need to select a supply partner. This subject has been well covered in previous blogs so we need make no further comment here.

This article is about how you engage with your chosen supplier(s).

Dealer or reseller?

The most common question we get as we recruit new partners is if they should become a dealer or a reseller. This is not as straightforward to answer as it may seem. In general terms a reseller has the contract with the end customer and they bill and support them directly. A dealer often sells the solution to their customer but the billing and support will be done by the supplier who will often then pay the dealer a commission. The decision to go dealer or reseller can differ between products and contract terms so the first thing to say is make sure you pick a supplier that offers both schemes with options to transition between them. Here are a few more things to consider;

How do IT and Telecoms companies choose their suppliers?

In the many years I have worked in the IT industry I have been supplier, reseller and end customer. 

Big Telcos

As a decision maker in both a small and medium sized business I wanted a local supplier that I knew and trusted that could offer a range of options with good support. Obviously I wanted a good deal but I know from experience that the best deal is rarely the cheapest. I tended to avoid the big telcos even though I knew they were probably supplying my local reseller. Companies like BT, TalkTalk and Virgin are not geared up to deal with SMEs. Their overheads limit the time they can spend selling and supporting their products and once you get underneath their headline prices they often come out the most expensive.

I am not a lawyer and anything I write on business contracts cannot be relied upon legally, however I have been reading, drafting and negotiating telecommunications agreements since 1986. Of course every agreement is different but over the years I have noticed three contractual areas that come up regularly.

Initial period extensions

This is a very common trick and one you and your customers definitely need to look out for as often it is buried in the small print. Customer A signs a 36 month contract and a day after the 36 month period expires tries to cancel the service.

Online Checkers

To get a definitive answer to the question what broadband speed is available, there are several web-sites you may need to check in with. The definitive guide to if BT Fibre is available is www.openreach.co.uk (after all these are the guys actually building the network and installing the service). If you don’t have a BT phone number this site will work with just an address however it won’t tell you what speeds are available or, if fibre is not available now, when it might be. It also won’t tell you if you are in a Market A or B (until recently Market 1,2 &3) exchange area. This information can be found at www.samknows.com and it matters because BT charge more where they don’t have any competition and this affects prices from their resellers too. Samknows will also list all the carriers operating from your local exchange but it cannot tell you if you can get fibre broadband because it only goes to exchange level, not cabinet level. There will be hundreds of cabinets attached to every exchange and not all of them will have been enabled for fibre broadband.

Why do you need to improve your internal call handling?

According to a recent American Express survey, 78% of customers have terminated a purchase they were going to make because of poor customer service. 96% of customers won’t report bad service, choosing to buy from someone else instead. On average loyal customers are worth up to 10 times their original purchase and a key factor in keeping a customer loyal is their satisfaction when they contact you. These statistics raise the important of effective call handling to help retain and build loyal customers. With this in mind we have compiled 5 ways to improve business call handling as follows:

1. Set a target for answering calls – of course it would be easy to answer all calls within two rings just by hiring more staff but this is probably not commercially feasible. The industry standard target for business to business call centres is 80% of calls answered within 20 seconds with the best performing above 90%. Balance what your customers expect against what is affordable and make sure everyone understands these targets.

Buying a telephone system used to be a headache for businesses that needed more functionality, expected to grow or had spikes in demand.

Higher specification systems that could do things like CRM integration, call recording, advanced statistics, intelligent call routing and advanced call handling were designed for large Enterprises and came with a large Enterprise price tag. For growing or seasonal organisations the dilemma was also what size of system to go for. Do they pay through the nose for a system now that will accommodate their needs during peaks in demand (e.g. Christmas) or for the number of staff they might have in 12 months time? Or do they go through the disruption and expense of upgrading nearer the time? What if they had to scale back, move office or simply didn’t grow as quickly as they had anticipated? Then they were stuck with an overhead they just didn’t need and probably couldn't afford. Also SMEs want to spend their capital on acquiring and growing customers, not on infrastructure. What if there were a reliable alternative where they could get everything they needed CAPEX-free and only pay for what they use? Now there is.

Anyone in the recurring revenue business that tells you they are 100% channel-only is mistaken. Friends, family, legacy start-up customers, end-users of resellers that have gone bust – even the most exclusive of channel suppliers has them. This doesn’t mean they’re not to be trusted. There are companies, like Jola, that were set-up specifically to serve the channel and there are others that started with direct customers and decided later on to sweat their assets and build volume through wholesale. Most companies that understand and are ‘invested’ in the channel are unlikely to deliberately or carelessly allow their channel credentials and reputation to be questioned.

Partnering with the voice and data channel means we get to work with a lot of entrepreneurs. They are usually straight-talking, candid individuals that have a passion for their company, customers and staff. Jola Partners are unapologetic about calling me up on evenings and weekends and the conversations we have are often as much about our businesses as they are about customers and products. Working everyday with entrepreneurs is inspiring and I always encourage people thinking about starting up on their own to consider the business communications sector (and to partner with Jola).

1. Know your true value

What are your strengths and your real competitive advantage? Do you have a product that is not only unique but for which there is also a demand? Are you the lowest cost provider or do you add value through the expertise of your sales and pre-sales support. So many suppliers to the channel kid themselves they can charge a premium because of their service wrap and the quality of their salespeople. In actual fact the resellers they serve would outsell any of the ‘experts’ their suppliers put up as their ‘value-add’ and few would put them in front of their customers. If you are offering leads to your channel Partners then don’t over-promise and if you also operate a direct channel then know that this will raise concerns and address them head-on.