Getting untangled from a relationship can be time consuming, costly, and angst filled. That’s why it’s so important to choose wisely when it comes to a vendor partner. You’re not just adopting their product or service; you’re banking on their commitment and expertise to help you optimize those solutions and grow.
“We should be choosing vendors judiciously because they offer a service that we really need,” says Ed Correia, president and CEO of Sagacent Technologies, an MSP in Santa Clara, California.
Beyond product fit and cost-effectiveness, there are some intrinsic parts of “partnership” that can lead to mutual success and should not be overlooked when you’re vetting a vendor.
Lean On Me: Can You Count On Your Account Managers?
For Michael Goldstein, president of Fort Lauderdale-based LAN Infotech, the ability to form a relationship with a vendor is a key criterion, and that starts with account management. “When we’re vetting vendors, we make sure we’re getting the proper support,” he says.
Here are some key considerations when vetting MSP vendors.
Goldstein expects his vendor representatives to help him clearly understand their contracts too: “I think it’s important to make sure you understand what you’re getting.”
Account managers should act as “an advocate, knowledge source, people/resource connector, and obstacle remover/smoother,” says Dawn Sizer, CEO of 3rd Element Consulting, an MSP in Mechanicsburg, Pennsylvania. “I would also expect them to be honest, have integrity, and be personable. While they may not be able to accomplish everything you ask for or want, they should know what is within the realm of what can be accomplished in their organization.”
They should also be setting quarterly business reviews (QBRs) with you, she adds.
Wanted: Marketing Materials And MDF
The availability of marketing materials is also very important to Correia. “You should be able to create white-labeled marketing material I can take content from,” Correia says. “If you don’t have that, it’s a big negative for me.”
The availability of market development funds (MDF) ranks high for Goldstein, although it’s not the primary qualifier. “If a product solves a problem, has great support, and a good representative, yes, it’s important to have MDF.”
While MDF gives LAN Infotech the resources to run events, Goldstein knows that comes at a price. “My grandfather always said, ‘There’s no such thing as a free lunch,’” he notes. “I understand most MDFs require you to sign a small client,” while some vendors have stricter guidelines.
This has prompted Goldstein to try and be more creative and bring in the vendor to demo a product to clients rather than make an overt sales pitch. “For every dollar they invest in us, we hope to turn that around to a 20% return,” he says.
Sizer, on the other hand, considers MDF to be essential to an MSP’s strategy. “There should be a conversation around [funds] before you sign up for any product or service,” she stresses. “Don’t have the conversation after the fact.” This should include what you need to do to qualify, for what amount, and how to increase that amount if some type of return on investment can be established.
Nuts And Bolts: Contract Flexibility And Tech Support
Contract terms vary, but Goldstein likes it when there is some flexibility. However, he adds, “If someone gives me a better price to commit for three years, I’m not opposed to that.”
LAN Infotech is a Kaseya partner, and Goldstein says the firm’s Partner First Pledge (see Sharing The Risk: A Look At Kaseya’s Partner First Pledge) “is probably one of the first times we’ve seen a vendor be upfront” about price locks. Kaseya also offers one- and three-year contracts, and part of the Pledge includes one-year pricing that is now more competitive.
His main priority is having 24/7 support and accessibility to representatives. Goldstein also likes it when a vendor has a certification program. “I want to be the best I can be,” he explains.
Sizer is open to any contract commitment—as long as 3rd Element can leave for any reason. “I won’t sign for long periods of time without an out, especially where [an] acquisition is concerned,” because you may no longer be dealing with the same decision makers. “So have that written into any contract with a vendor so you don’t have to do business with those companies that don’t do business the way you do,” she advises.
When it comes to training, Sizer says the importance depends on the product. “The more complex and essential to the business a product is, the more meaningful training is,” she notes.
Watch Out For Red Flags
Goldstein says limited support, a lack of representatives, and a bad reputation are red flags for him. Both he and Correia say they rely heavily on their peer networks before selecting vendor partners.
“I want to see what references I can get and what other partners are using,” Goldstein explains. He relies on his peer network for information on how long a vendor has been around and what their customer base looks like.
Correia tries not to sign on with any vendor “until I run it by my community.” He also posts in online forums, “and if I hear horror stories, it’s enough to stop me in my tracks and do a much deeper investigation or abort completely.”
Sizer also has a list of issues that would cause her to pass on a vendor partner:
- Shady business practices. Evaluate them to determine whether “they are ethical and in moral alignment with the way you do business,” she says, agreeing that it’s important to check with your peers and online sources “to be sure you aren’t blindsided by a vendor partner’s actual business practices.”
- A poor security track record/lack of certifications.
- If they only build products for acquisition.
- If they aren’t channel-only. “I don’t need to compete with a vendor, especially [with] my own clients,” she notes.
- Long-term contracts.
- If the product doesn’t do what the vendor claims it does.
- If they expect a transaction as opposed to a relationship. “If it’s a transaction, that’s a hard pass,” she says.
MSPs are right to be discerning, given the plethora of tech vendors there are to choose from. While relationships with vendors don’t have to be a marriage made in heaven, a careful selection process will most certainly help avoid a messy breakup.
