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5 Big MSP Benefits of Working with Fewer IT Vendors

Author: Brian Babineau

As a managed service provider, you probably have partnerships with a number of hardware and software vendors. However, you may reach a point where you ask, “How many vendor partners are too many?” When you consider the impact juggling a wide range of vendors can have on your business, the answer is that less is more.

Channel consolidation is doing some of the work to pare down the number of vendors for you. As companies merge or are acquired, channel partners gain the ability to provide more solutions through fewer vendors, meaning fewer partnerships that must be managed to meet your clients’ needs.

As you consider your current vendor line card and the possibility of narrowing down the list, be mindful of the number of partnerships your company has formed over the years and the challenges that have come from managing those vendor relationships. Here are five benefits your company could gain by working with fewer vendors:

1. Less finger pointing. When MSPs try to be too “vendor agnostic,” it can lead to having to manage a wide variety of solutions from different hardware and software manufacturers. When something goes wrong with a customer’s network, having too many vendors can make it much trickier to find the culprit. Plus, if multiple vendor helpdesks are involved, you can expect there’s going to be blame shifting, which will inevitably waste additional time and cause frustration for you and your customer. If you can minimize the variety of brands you work with, you’ll reduce finger pointing and find resolutions more quickly.

2. Integrated solutions. Partnering with fewer vendors will make it easier to offer end-to-end solutions without searching for hardware and software that integrate or developing integrations on your own. A prime example is working with the same company for backup and disaster recovery (BDR) and security. Partnering with a company that offers complementary solutions also makes it quicker and easier for an MSP to expand its offerings in these areas.

3. Streamlined administration. Fewer vendors to work with means less paperwork, fewer contracts to manage, less time-consuming training, and fewer certifications to obtain and maintain. It also makes it easier to keep track of partner benefits such as marketing development fund cycles, so you don’t miss out on opportunities to attract more prospects.

4. Stronger relationships. If your time is divided among multiple vendors, it’s harder to develop deeper working relationships with any of them. Working with a limited number of vendors enables better communication and more opportunities to meet face to face at partner meetings and training sessions. You may be able to leverage deeper vendor relationships to strengthen your industry and technology expertise, and receive invaluable feedback that can guide your business growth strategy.

5. Better margins. Top sellers are often rewarded by a vendor with discounts on equipment or software licenses, or other perks that can boost sales morale and ultimately lead to higher profit margins for your business. When your attention is divided among several vendors, however, it’s more difficult to reach sales and service levels that generate price breaks or other rewards.

Don’t forget to do your due diligence

Regardless of the number of vendors you decide to work with, never enter into a relationship lightly. This is an especially important message for MSPs to heed because unlike a project-based VAR that makes a sale and moves on to the next opportunity, you’re going to be forming ongoing relationships with your customers, and the vendors and solutions you choose will play an important role in your customers’ experience with your company.

Be sure to do in-depth research before signing a partnership agreement with a new hardware, software, or services vendor. Look closely at key metrics such as the vendor’s history and financial health, partner program benefits, and, of course, the breadth and quality of its solution offerings. Make it your primary goal to form a few close business partnerships that make the most sense for your business now and for the foreseeable future.


Brian Babineau is general manager, Intronis MSP Solutions, for Barracuda Networks. Read more Intronis MSP Solutions blogs here.

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1 Comment

Comment

    Nick Bock:

    Great article, and spot on. Very much in line with SLI’s “Stack” mentality. Great contribution Brian!

    Nick

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