UCASS cost of sale for an MSP
Read about Joe Schiavone’s view on the technical and economic aspects of VoIP/UCaaS deals, about ‘’finger pointing” in the industry and the ideal scenario for MSPs to succeed in UCaaS sales.
With his new appointment to LANtelligence, Joe Schiavone brings on board not only decades of VoIP sales experience but also a deep understanding of an MSP's everyday business. Throughout his career, Joe has helped hundreds of MSPs to make their VoIP deals easy and profitable. One of the first conversations we had with Joe when he started working at LANtelligence was about the issues that most of the MSPs experience selling, implementing and supporting telephony solutions for their customers. We couldn’t help sharing this conversation with you.
Editor: We see that a lot of MSPs are hesitant about selling telephony solutions, even though it can be a profitable business. In your opinion, what is the main reason for that?
Joe Schiavone: There are many reasons and all of them are driven by either a technical or economic aspect. For instance, for most of the MSPs, the cost of a UCaaS sale is too high and it’s always too much of a hassle whenever they have to troubleshoot an issue with the customer’s telephony system.
Editor: Could you please tell us a little bit more about the cost of a UCaaS sale?
Joe Schiavone: I have done this research with one of my previous teams. Over the course of 60 days we handled 645 customer support calls per week for our MSPs, with an average time of 6 ½ minutes per call. It is 70 work hours just for answering the phone. Now, imagine an MSP that doesn’t have a dedicated partner for their UCaaS installations has to handle those phone calls on top of diagnostics, troubleshooting with the carrier (which they don’t have to do at all) and do the actual problem solving. If we talk about a new installation, we should consider the set-up time, provisioning, end user training and support within the first 30 days, and more. On average, an MSP spends up to 42% of what they make on UCaaS projects to cover these activities.
Editor: You have mentioned that MSPs are troubleshooting with the carrier whenever there is an issue with the customer’s telephony. Most of the MSPs are not telephony specialists, which means it takes them way too much time to do it. Can they rely on the carrier or a solution vendor in this case?
Joe Schiavone: Here’s the thing, an MSP is a one-call, one-responsibility contact for their customers and they like keeping it that way because a big share of their success depends on these relationships. To maintain customers’ trust, MSPs are ready to go this extra mile. But you are right, there is usually more than one party in the troubleshooting process and it often creates the situation where everyone is “finger pointing” at each other, but for the customer the only responsible party is an MSP.
Editor: Can you be more specific about this “finger pointing” situation?
Joe Schiavone: When something happens – phones stop ringing, calls are routed wrong, audio delay, and so on – there are several different scenarios that might include a carrier issue, software bugs, hardware defects, human error, Internet bandwidth, mis-configured deployment, etc. The customer may or may not have an in-house IT manager and if they do, this person is typically not a telephony specialist. When receiving a call from a customer, an MSP will run their typical network tests (usually multiple speed tests throughout the day), will check all connections and run internal diagnostics at the station level. After that they will have to contact the carrier and a solution vendor to troubleshoot on their level. In many cases, if the carrier or vendor don’t see an obvious problem, they will “finger point” at each other or back at the MSP without deeper diagnostics. To minimize this situation, some MSPs get their staff certified in telephony solutions but for most, it is just not profitable, especially if they have multiple vendors to get certified with.
Editor: It seems like the best way for the MSP to avoid VoIP hassle is to get everything under their own control which is extremely expensive and time consuming. What would be the optimal scenario for them as you see it?
Joe Schiavone: As I see it, MSPs should be able to delegate VoIP projects to a reliable partner. It is too complex and too much of a niche specialization, and UCaaS installations (depending on their size and complexity) often require a very dedicated staff to oversee them. There is no reason for MSPs to give up on this business just because they can’t afford such staff and can’t fully rely on the vendor. A partnership with an established UCaaS provider eliminates the technical headache and doesn’t create competition for the customer on other managed services. One of the reasons I started working with LANtelligence is because they offer exactly this, and this is what most MSPs need to be successful in the UCaaS arena.
About Joe Schiavone:
Joe Schiavone is a Director of Channel Sales at LANtelligence. He has over 30 years of experience in the telecommunications industry, along with a proven track record of working with channel partners to build out new markets and grow revenue. His experience spans throughout the United States and internationally with companies such as FreedomVoice, VoiceNation, Toshiba, HTG, Connect Wise, Tiger Paw and more.