I have to admit, I have been in the technology industry for many years. I like to refer to myself as a “seasoned professional”. In my years in the industry, I have seen my share of technology solutions come and go. Some go away because they are replaced by more sophisticated versions. Many have gone away because they are replaced by better technology. Have you used a fax machine lately? While they are still around, they are certainly heading the way of the dinosaur. In today’s world, technology rapidly deteriorates. How long has your last appliance lasted compared to your parents’?
But what does that have to do with the title of this blog? Everything. Quality organizations realize the need to spend money on technology but they also are frustrated by the “nickel and diming” they perceive their technology providers are always doing. A monthly payment can remove that perception. As opposed to your customer asking you, “How can I get this for less?” they’ll evaluate and tell themselves, “We can afford this payment.”
Stop Nickel and Diming…
Most studies typically indicate that the overall 5-year total cost of ownership (TCO) on a technology solution is only 20% of the actual up front cost of the solution. The remaining 80% of the cost is the ongoing support. These costs include hardware support, software assurance, server enhancements, end of life replacements, etc. These are just the costs of supporting the technology solution, not including enhancements or upgrades.
If this 80% is accurate, what can your business do to address this and help companies not just control the costs but adequately budget and prepare for the future? An all-encompassing monthly cost or “managed service program” that includes the overall costs of operation for the time frame requested is a great option and growing in popularity.
The overall benefits to the business financially are very strong as well. Recurring revenue is revenue you can “take to the bank” in more ways than one. It provides for a much stronger balance sheet that potential investors or acquirers look for when evaluating a company.
And as one of my industry colleagues once stated, technology ownership is highly overrated. Do you want to own a dinosaur?
For more information, download a guide from GreatAmerica entitled “13 QUESTIONS to Differentiate Yourself and Position Financing.“ This guide will help your sales people ask needs-based questions that will impact your ability to set your sales organization apart from your competitors and position you to sell more long-term contracts with recurring revenue.
For more information on this blog post or any other CorsPro functionality to help you position monthly payments, please email us.