I wish I could tell you that the client has already returned to our service while sharing tales of Dells service follies. This unfortunately has not happened, yet, but I do believe there is a good lesson to share in this story and it is: LONG TERM CONTRACTS

Long term contracts may not seem that revolutionary but i would suggest if you have not moved to a two or three year contract on your services you are missing a big opportunity.

If you look around you will notice that most contracts being presented to prospects these days require a commitment of greater than a year allowing you to lock in the relationship and better predict attrition rates.

One of the easiest ways to do this is to provide hardware with your services. Prospects are use to the idea of a 36 month lease on equipment so when you tell them you will provide all your services and include X hardware if they sign a 3 year deal they don’t think twice about signing up. If you are not providing hardware with your services you need to look at both the Zenith BDR solution as well as the guys over at Chartec that allow you to do so with very little investment on your part.

So how does this all relate to the client Dell managed to coax away from our services? Well, the reality is that they are still our client and will be for the next 17 months. We had signed a 36 month agreement with them on part of our service and they they still look to us to provide this service today.

This is great from a few perspectives:

1. they are still our client and we held on to over $12,000 in revenue
2. the margin on providing a piece of service is often greater than being a complete IT team for a client – which it is in this case
3. when the client is looking for something the new provider, Dell, does not provide or for a second opinion on something that has been recommended they still call me for advice – i spoke with the CEO not more than a week ago and guarantee i will be top of mind if and when they decide to change providers again!

So the silver lining to the Dell managed services story is that we did not actually lose the client, we only lost a piece of the revenue, and I look forward to the post telling you the client has come back to us.

Dust off your contracts and find a compelling way to make them 36 months!

Josh

As I’ve said in previous posts on this site, I’ve been confused as to why an MSP would want to partner with Dell to provide managed services.  Dell has clearly never been a supporter of the channel, but is now making some strategic shifts that may make it a channel-friendly vendor.  I stress may, because obviously many people are unclear as to if this is true, or if Dell is a sheep in wolf’s clothing.  Given this, I’ve never understood why I should jump into bed with them.

That’s what I’m trying to figure out by watching this presentation.  Here is what I learned:

1. Deal registration – you don’t have to worry about competing with Dell
2. Get to use Dell/Silverback technologies and processes, including the “Business Builder” services in which Dell helps you get your managed services practice off the ground if you are not yet a developed MSP
3. Sales and marketing materials and training
4. Sales and marketing campaign assistance/lead generation
5. Dell has a “warchest” of capital that people believe is going to give them and their partners a competitive edge in the marketplace

I think the presentation left me with as many questions as it answered, which doesn’t surprise me too much as you can only go into so much detail in a webinar.  If I have the time, I suppose that I will have to contact Dell directly to find out the real details of their offering.

I for one will definitely plan on sitting on the sidelines and watching how everything shakes out, but it seems that Dell’s partners featured in this presentation are happy with their relationship (of course).  As Peter Klanian from Dell pointed out in the presentation, Dell’s behavior and track record over time will determine how much the channel trusts them.

I think I will really start giving Dell some real credit is when I’m at a managed services conference and someone runs up to me and says “I’m working with Dell and I’m making so much money – it’s the best!”.  Will it happen?  We’ll see!

MRC

I was reading a recent article on MSPMentor about the 150 or so partners that had signed up, and I was racking my brain to figure out why they would do it.

From my understanding of Dell’s program, which is admittedly very limited, it seems that you can resell their MSP offerings, taking advantage of their tools and infrastructure.  But what does the service provider get in return?

My original thinking was that it must be the following:

1. Some margin from the managed services deal (which couldn’t be that much in $ value given their pricing)
2. A guarantee to get first crack at all onsite work done for that customer

But I was looking at some responses on the MSPMentor site from one of the senior people at Dell, and it sounds like Dell is planning on doing all of the onsite work through their nationwide onsite contracts.

Obviously, I’m missing something.  Are service providers marking up the Dell services and packaging them as their own?

Can someone explain this to me?

MRC

PS – this is a topic I probably won’t be covering in our member site MSPCoach.com, since I know nothing about it.  But there is a lot of other good stuff in there!