Don't Let SMB Profit Margins Slip

There is a myriad of data pointing to growing SMB sales opportunities for VARs and integrators. For example, a recent survey conducted by the Computing Technology Industry Association (CompTIA) revealed that nearly one-third of the North American SMBs polled intend to buy new phone systems or make significant new investments in their current phone systems in the next 12 months. But, there's another side to the SMB growth trend that has many VARs worried: shrinking sales margins. Just about every SMB wants low-cost, easy-to-implement solutions. This is true for almost every technology, but particularly with VoIP (voice over Internet Protocol). VoIP vendors have responded to SMBs' requests with 'VoIP-in-a-box,' 'all-in-one,' and 'plug and play' solutions. If you're used to earning most of your profit margins from hardware sales and implementation services, you're going to be disappointed. And, it's only going to get worse. Don't despair, however; there are plenty of ways to keep your SMB profit margins from slipping. Consider the following four suggestions (note: many of these apply to non-VoIP implementations, also):

1. Perform Network Assessments
Quality phone service is important to any customer. Plus, if their VoIP phone service experience is noticeably poorer than their traditional phone service, you're going to be the one to blame. So, make sure to include a network assessment as part of a VoIP sale. Network monitoring equipment should be used to monitor the network's bandwidth over a one-week period to accurately detect anomalies that cause spikes in network usage. This service also gives VARs an opportunity to identify networking equipment that needs to be replaced (e.g. some firewalls do not support real-time voice packet throughput).

2. Don't Settle For Default VoIP Configurations
I spoke with a university professor who recently went through a transition to VoIP. When I asked the professor how she liked the new phone system, she said the voice quality was fine, but the voice mail system was "a total pain in the [behind]." Don't let your customers say that about your SMB solution. Take the time to understand how your customer's legacy phone system worked, as well as how clients calling in interacted with the phone system. Understanding your customer's business makes you a more valuable business partner, and it enables you to provide configuration services, which are something customers are willing to pay for.

3. Insist Upon Employee Training
Even if you've done a good job configuring the new phone system, there are dozens of features your customer won't use unless you provide training. You could start with a 2-hour training session on five features other customers like, such as unified communications (e.g. having voice mail messages sent to your e-mail), simultaneous ring, fixed-mobile convergence (using a dual-mode phone that seamlessly switches from a Wi-Fi network to a cellular network), find-me follow-me functionality, and caller availability (i.e. call presence). Training opens your customer up to the real benefits of VoIP, and it's another billable activity for you.

4. Make Managed Services Mandatory
You can help ensure your customer's phone systems don't go down by providing managed services such as remote monitoring. Additionally, you can partner with your customer's ITSP (Internet telephony service provider) to receive alerts if there are network problems on the ITSP's end. It's also a good idea to develop a failover plan in the event a T1, cable, or DSL line goes down. Each customer's business continuity needs are different, which is why it's necessary to create a range of managed services offerings (e.g. 24/7 immediate response, 2-hour response during the work week, next-day response).

Selling professional services may not be as immediately rewarding as receiving a lot of money all at once from a hardware sale. However, after experiencing monthly recurring revenue from multiple sources, you'll agree that it's much more rewarding in the long run.