Making the Leap into the Corporate Market

Traditionally, the SME market has been the domain of the resellers and dealers. Times however are starting to change. The convergence of voice and data; the re-emergence of hosted voice services; the continued expansion of BT Openreach and WLR3 and the narrowing of margins across all suppliers are all triggers which are opening up opportunities for value added resellers to compete against the established corporate carriers in the corporate sector. Matt Atkinson, managing director of Aurora Kendrick James (AKJ), the UK’s leading tailored billing provider, shares his tips on how resellers can win business in this market.

Change Your Pricing Model

The economics of the corporate market are not the same as the SME telecoms market – there are not enough margins to go around. As a reseller your margin comes directly from the difference between your buy and sell prices; however the prices that you can buy at don’t seem to be falling so quickly anymore. As an example, to compete in the UK corporate market today on price alone expect to be offering lines at between £10 and £11 per month and making less than 5% gross margin on traditional calls.

One of the models that some resellers are starting to adopt to overcome this continuous price erosion is open book or fixed margin pricing. In this model the corporate customer is charged a fixed monthly service fee plus services at cost prices. Therefore, the customer automatically benefits from the latest market leading pricing without the requirement to go to market or constantly renegotiate; whilst the reseller retains a constant margin to support the services provided.

Focus on Value Added Services

Many Corporates simply do not have the time, knowledge or resource to effectively manage their telecoms estates. This gap of knowledge and expertise provides an array of opportunities for value added services to help resellers differentiate themselves from the traditional carriers. Some of the most common issues faced include:

Reducing telecoms costs on an ongoing basis.
Improved visibility, apportionment and accountability of costs across the business.
Streamlined administration of supplier billing and validation of invoices and costs.
Accurate management information and advice to support business decisions on new technology and capital investment.
Support of homeworker’s telecoms and IT.
Managing usage, capacity and policies.
Inventory management.

Remain Independent

As traditional services like voice, become applications over a converged network, the ability to blend services from multiple vendors becomes a reality and the reseller is perfectly placed to create best of breed solutions for corporate customers from the market as a whole.

By retaining independence, the reseller is able to offer Corporates impartial advice and the best solution for the customer as well as continuity of service even if the network or service provider changes. This again is a unique selling point enabling long term relationships to be created and is a competitive advantage above the main carriers.

Use Changes Such as WLR3 to Your Advantage

The creation of BT Openreach was a major milestone in allowing resellers to compete with BT and other large carriers. WLR3 offers further opportunities for resellers to expand the support they offer to customers including access to a much wider range of support tools than previously, including improved fault management, diagnostics and managing engineer visits (which previously were only available to BT directly).

Resellers are currently leading the way with the adoption of WLR3, and by using the additional facilities offered will add significant on going value compared to some of the larger carriers, many of whom will not have this technology.

Tailor Your Billing and Management Reporting

It is estimated that Corporates are wasting £1 billion per year by not controlling the cost of telecommunications. Offering corporate customers a true onebill solution can add immense value and really enable the corporate customer to improve the management of their estate. This type of approach is extremely difficult for the large carriers to provide and as a result billing and management information are often cited as some of the poorest aspects of their service.

In addition by generating quality management information based on this billing data, the reseller is in an ideal position to act as a trusted advisor to the corporate; identifying issues and trends and proactively recommending solutions along the way.

In summary

The barriers that used to exist which ensured that resellers struggled to compete in the corporate market are falling. Customers are starting to recognise that resellers can not only offer them the ability to independently select best of breed services from across the market, but also that they can improve these services by providing proactive management on top.

There has never been a better time to consider your corporate market strategy; and resellers today are starting to make a real difference by addressing the challenges that the large carriers have been unable to solve over the last 15 years of deregulation.