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Post #1
02-08-2005, 12:46 PM
MylesJ
Newsletter/Forums Member
Does anybody know a distributor or regional VAR that does real verticals?
I've been contacting some that claim to do verticals. Their idea
of a vertical is general accounting. My idea is realtime operation of
a specific industry.
In our case this is mechanical service and repair (cars, trucks,
bikes, boats, etc.). We built a small group of VARs last time around
and sold about 3,000
seats of the previous program. The new program is less expensive,
requires less of the local reseller post sales and has higher margins.
It uses SQL Server/MSDE. We worked with Ingram and Computer Associates in the past with marginal
success. I'm not looking for that size of distributor.
__________________
Myles J Swift
Computer Assistance Inc.
Auto/Truck Repair Management
Software since 1977
Post #2
02-08-2005, 01:33 PM
Ken Beam
Moderator
You're going to have a real stuggle finding VARs with such a narrow
industry niche I'm afraid. Their interests generally run towards
a specific technology and will dip into industry verticals, such
as ERP,
CRM, Supply Chain, Portal skills with expertise in Health Care, Insurance,
Retail, Manufacturing and so on.
If the product is not a big ticket item with a services component
(revenue) that would at least equal the cost of the expensive application
there's just not much appeal to them.
Small regional VARs are typically known for their infrastructure capabilities
with an emphasis on Security, Messaging, LAN/WAN/SAN certifications
and other general SMB IT requirements.
Smaller ticket items requiring a minimum of support are being found
in the CDWs and other online retailers; but, as quasi-distrubutors
and order takers they'll never generate incremental dollars for you.
These observations are all painted with a broad brush stroke, but
fairly representative of the reseller marketplace as it is today.
Channel Cheers,
Ken
__________________
Kenneth G. Beam
Team Captain
The VAR-City
"
...solving the Partnership Puzzle"
Phone: 972.240.8793
Web: http://thevarcity.com
Email: kbeam@thevarcity.com
Post #3
02-08-2005, 03:01 PM
MylesJ
Newsletter/Forums Member
I know most of what Ken says is true, but I figured you guys would
be in the best position to know of someone. We have structured the
product so that the reseller should end up doing the network support
and integration. There are a lot of products in this market that
all need to run on the same network. No vendor in the market supplies
this
kind of local service. The reseller that supplies the shop management
software usually gets to be the IT department. The shops run live
connections to parts houses, to repair information databases, to
recall databases,
to Carfax and other providers in addition to the work done in house
on the shop management system. The better resellers on our last product sold about 100 copies of
our product and about half those customers have stayed as long term
support customers. Our deal with them was providing an extra 20% margin
to fund local marketing efforts.
__________________
Myles J Swift
Computer Assistance Inc.
Auto/Truck Repair Management
Software since 1977
Post #4
02-09-2005, 09:12 AM
pmorettini
Moderator
Myles, My experience is that it is very possible to find small, vertically
focused distributors internationally, but almost impossible in the
US. What Ken says about the reseller (VAR) market is very accurate.
__________________
Phil Morettini
PJM Consulting
phil@pjmconsult.com
858.792.1062
Post #5
02-09-2005, 11:46 AM
MylesJ
Newsletter/Forums Member
Can you point me to is disty like this in England, India or Australia?
I have one reseller running a beta right now in England and one considering
it in India. __________________
Myles J Swift
Computer Assistance Inc.
Auto/Truck Repair Management
Software since 1977
Post #6
02-09-2005, 01:32 PM
Charles Mills
Principal Moderator
Take a look at http://SoftDatabase.com .
__________________
Charles
CharlesMillsConsulting.com
StrategicDueDiligence.com
Post #7
02-09-2005, 01:51 PM
pmorettini
Moderator
It's not that simple, unfortunately. Charles points you to a good
place to start, but as others have pointed out, you are in a very
narrow
niche. My guess is that you won't find anyone in that database that's
suitable. You needs someone who is active in your marketplace. Simply
signing a "generic distributor" will be highly disappointing.
You need to dig around a little be to find that. You are likely to
be pleased if you find someone entreprenurial, probably small, who
will "act in that country as you would in your own". Someone
who will develop the market in that country, not an order taker like
you normally think of distributors. This takes a bit of doing. Start
networking with people in your industry, and ask about people who might
be suitable. If the market is really thin you might even have to go
with someone who is capable and interested in becoming a distributor,
but isn't currently in this business. Think creatively, and start talking
to people in and around your vertical - other complementary software
suppliers, the VARs you are talking to, end users, Industry experts,
etc. A great way is to attend a trade show in that country--people
in will often find you when you do. __________________
Phil Morettini
PJM Consulting
phil@pjmconsult.com
858.792.1062
Post #8
02-09-2005, 02:06 PM
Charles Mills
Principal Moderator
I should have also mentioned that several of our moderators in this
forum are consultants in the distributor relationship business, and
might be able to help you -- for a fee, of course. The moderators
in the International forum are in the International sales consulting
business
as well. Also, you could try a listing in our Jobs & Partners forum.
__________________
Charles
CharlesMillsConsulting.com
StrategicDueDiligence.com
Post #9
02-09-2005, 03:17 PM
Dave45000
Newsletter/Forums Member
Why don't you ask your customers who they buy from? The next thing to do is to look upwards to the top of the industrial
category for the supra category. In oil and gas the ultimate parent
is resource extraction. The supra is sufficently similar and much larger
spanning many different verticals. The supra might have a distributor
large enough for you.
Accounting can be horizontal or vertical depending on how specific
and partitioned the accounting requirements would be.
David Locke
Post #10
02-09-2005, 04:10 PM
MylesJ
Newsletter/Forums Member
In the US we run roughly one tech per 300 families, so roughly one
shop open for 2,500 families, if you limit the market to auto and
light truck businesses. Figures go from 100,000 to 300,000 potential
customers
in the US, depending on what figures you use. The new product is
appropriate for about half that market. The dealers that have been
selling our
products for years are local VARs who wanted a local market they
could own, not people associated with the automotive industry.
The local
warm body is what the customer needs to commit. I can get them 90%
of the way from here. If we were selling $20,000 systems then direct
sales would be better. If the $1Kto $6K market it needs to be someone
local. We've been participating in the catalog show section of some US trade
missions which is where the overseas contacts I have were found. There
is one big trade show in Europe but $30,000 and a months focus is not
a good idea for us. The main US trade show is not until November.
__________________
Myles J Swift
Computer Assistance Inc.
Auto/Truck Repair Management
Software since 1977
Post #11
02-09-2005, 04:13 PM
pmorettini
Moderator
So these local VARs are also selling into other verticals? __________________
Phil Morettini
PJM Consulting
phil@pjmconsult.com
858.792.1062
Post #12
02-09-2005, 05:17 PM
MylesJ
Newsletter/Forums Member
Some sell into other verticals, some have picked up other products
in the auto/truck area like body shops (completely different paper
trail from mechanical) or combined gas station/convenience stores. We co-operate with two companies that sell F&I software to small
car dealerships and used car dealers. Sometimes we get there first
and sometimes they do. We are currently adding features to allow realtime
access to the inventory of the largest import parts reseller in the
country. That company is not interested in any affiliation with any
service management vendor.
__________________
Myles J Swift
Computer Assistance Inc.
Auto/Truck Repair Management
Software since 1977
Post #13
02-10-2005, 08:43 AM
pmorettini
Moderator
Have you talked to the other 2 companies about what they do internationally?
You may be able to leverage any efforts they have made. If they've
down nothing you may be able to band together to "find or create" distributors
in countries you'd like to attack. __________________
Phil Morettini
PJM Consulting
phil@pjmconsult.com
858.792.1062
Post #14
02-10-2005, 09:42 AM
MylesJ
Newsletter/Forums Member
Neither of them has any interest in a larger market. They are more
interested in the service revenue than the product revenue. One of
them is a Canadian company so we make a little progress there. I
know that the Canadian guys have been through several hires trying
to find
the right skill set. Another Canadian company in the F&I market
has just gone away so they are focused on picking up those customers. __________________
Myles J Swift
Computer Assistance Inc.
Auto/Truck Repair Management
Software since 1977
Post #15
02-10-2005, 10:15 AM
Dave45000
Newsletter/Forums Member
How would your product enable them to generate more demand for services? David
Post #16
02-10-2005, 11:07 AM
MylesJ
Newsletter/Forums Member
For the F&I people, it would take them from a 4 to 6 user network
to a 10 to 25 user network. It would get them training time on MSExcel
and MSWord. It lets the sales people add options to new cars. It lets
them dicker with used car buyers over what improvements can be made
at what price when they can pull up the price and time to make those
improvements from the shop system. This increases sales and everything
that goes with that, like training new hires, etc. For the customer
we provide tracking of services not done, services due, emailed, and
printed reminders to increase service department sales. We provide
comprehensive pivot table analysis so that shops can find and persue
the highest margin jobs. __________________
Myles J Swift
Computer Assistance Inc.
Auto/Truck Repair Management
Software since 1977
Post #17
02-10-2005, 11:54 AM
pmorettini
Moderator
One last idea for you with respect to international distribution
and thinking creatively. I'm sure that you have print publications
or websites
which the endusers of your product read. Put a small ad in one or
a few of them: "Auto Service Shop Software Provider seeks distributors
in select countries worldwide. Exclusive territories available. Contact.....
for more information at....." See if it generates any interest. It may seem to be a bit of a longshot,
but shouldn't cost you much. You may get no responses, or alot that
you don't care to get that you have to wade through. But with a little
luck you also might get someone with experience in your industry, who
happens to be software-savvy and entreprenurial-minded. IMO, this could
be a great match for a vertical supplier like you.
__________________
Phil Morettini
PJM Consulting
phil@pjmconsult.com
858.792.1062
Post #18
02-10-2005, 12:09 PM
Dave45000
Newsletter/Forums Member
Adding to what Phil suggested, you could go with a contextual ad.
These ads appear on results lists for certain keywords. These would
be seen
globally and in a lot more topic categories. Do this after you run
an ad at your own site. David Locke
Post #19
02-15-2005, 11:21 AM
ytekale
Newsletter/Forums Member
in India? Myles,
i know the indian landscape relatively well and i am surprised that
you have a potential reseller with such a focus? i wld have thought
if such focus is rare in the US and UK, it would be rarer still in
India, and i am not sure if the indian market is mature enough for
this
yadu
__________________
yadu
Post #20
02-15-2005, 12:56 PM
MylesJ
Newsletter/Forums Member
If you think of our products as providing 80 to 90% of the function
of ADP or Reynolds and Reynolds at 10% of the price you can see how
that would be attractive to a market such as India where vehicles sell
for 10 to 20% of US and European prices. We've had features that the
big guys don't pick up on for years. We had a feature that came out
in the mid 80s that Reynolds added as a big new feature to their 2000
version. They sell a comprehensive turnkey in the $80,000 initial price
range. Our product combined with MS Office and Quick Books (or other
accounting) is far less expensive and has features that they do not
have. __________________
Myles J Swift
Computer Assistance Inc.
Auto/Truck Repair Management
Software since 1977
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