unfortunately, we may no longer be the right provider for you.’ De La Haye originally decided to use Giacom’s cloud marketplace to consolidate his licensing for cloud services, for antivirus and for backup solutions, which meant he wouldn’t have the inconvenience of paying several different suppliers. However, with this new surcharge he is now making alternative arrangements. “That financial squeeze is untenable when all I’ve got is half a dozen 365 licences with them and a good few Bitdefender licences. It would literally double my costs to Giacom, so I’ve just moved all my Bitdefender licensing across to Atera, which I’m now paying for as part of my Atera subscription to their CRM and RMM. I find it a really useful tool and the great thing about it is that with Atera’s licensing model you have a licence for your user, not for each of the endpoints, so I pay one fixed price to use the service and I can add as many endpoints as I like at no extra cost.” Two years ago, FOIT experienced another penalty faced by smaller IT service companies, minimum monthly spend commitments, when Simwood, which provided the trunk line for its VoIP services, increased its minimum monthly spend from £100 to £250. “I had to move away from Simwood when they put up their minimum spend by £150, because there was no way I was going to put that amount of money on the trunk every month. I moved to aql, where my trunk costs are about £100 a month.” More recently, FOIT's broadband supplier has thrown sand into the gears by shifting FOIT’s payment terms from 28 days to 14 days, putting it out of kilter with customers’ payments. While De La Haye has been able to find alternative suppliers that are perhaps better suited to FOIT’s requirements, he still resents the time that he has been forced to spend on identifying providers that are happy to support smaller customers. “It has cost me an awful lot of time that I could have spent selling to clients, which is what I desperately need to do at the moment, with margins being squeezed ever further and prices going up. My datacentre costs are going up by 12% at Hetzner. I haven’t seen Microsoft drop their licensing prices lately; there’s no backpedalling on service costs. It costs me X amount of pounds just to keep the lights on and heat the office. Utility prices are going through the roof. And for these companies to turn around and ask for extra cash just for the pleasure of doing business with you is another blow.” De La Haye is reluctant to pass on these added costs to customers who will be facing many of the same pressures he does but fears he won’t be able to put off price rises for much longer. “It’s now getting to the stage where I have to consider putting at least 12% on my prices to my clients, and I’m not the cheapest service provider by any means so it’s going to make me uncompetitive compared to some of my rivals.” Stop discrimination So, what should vendors and wholesalers be doing to make life easier and fairer for the thousands of small IT companies like FOIT that exist across the UK? First, says De La Haye, they should stop discriminating against small resellers by applying minimum spends and surcharges to small accounts. Second, they should offer attractive terms for new technologies like SoGEA (Single order Generic Ethernet Access), which BT Wholesale currently only provides on a one-year contract. “If they want us to get clients off FTTC and onto SoGEA, businesses like me are not going to be able to do it with oneyear contracts hanging over our heads,” he explains. “At the moment I provide broadband on a monthly contract, which is very attractive for small businesses – and for me because small businesses have a failure rate of something like 60% to 80% in the first three years. If I was to provide broadband on a one-year contract, as my provider asks me to do with SoGEA, I would be locked into providing that service for one year and would pay for it even if my client went bust. There’s a high degree of risk in providing services on long-term contracts to the kinds of company that I deal with. “One-month contracts, with the ability to cancel at any time, are also a selling point for the customer. If I can’t offer that on SoGEA, which I can’t with all the service providers I’ve gone to so far, why would I choose SoGEA rather than a one-month contract for FTTC broadband. We’ve got to go to SOGEA eventually, with the 2025 switch-off, but how am I supposed to do that when I can’t offer my clients a onemonth contract?” Ultimately, the future success of smaller resellers and IT support companies will depend to a great extent on the choices made by wholesalers. For as De La Haye says: “We’re beholden to wholesalers, so the wholesalers have got an awful lot of power. If they want to change things arbitrarily, we’re stuck with it, because we’ve got nowhere else to go.” Giacom Response Responding to De La Haye’s criticism of its £100 ser vice fee, a spokesperson for Giacom said: “We have a very diverse partner base, from businesses spending £1 to those spending millions of pounds, and we’ve always strived to provide them all with the same level of ser vice. This hasn’t always been easy, especially with factors like NCE, where we saw more tickets raised in one day than we’d previously had in a month. This ultimately detracted from our partners with whom our proposition is a great fit, so we took the uncomfortable decision to apply a small charge to those spending small amounts.” technologyreseller.co.uk 39 VIEW FROM THE CHANNEL
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