Is Your Cloud Provider’s Pricing Model Cutting Into Your Hard Earned Profits?


Sep, 13

Is Your Cloud Provider’s Pricing Model Cutting Into Your Hard Earned Profits?

Even if you’re selling all the right IT solutions and your engineers and salespeople have all the right training and certifications, there may be a couple of serious financial drain sources right under your nose that you’ve been overlooking.

I recently spoke with Jim Turner, founder and president of Hilltop Consultants, who reminded me of this reality. Turner founded his company 10 years ago, and he’s projecting 32% sales growth this year. A big theme that led to his company’s success was paying attention to details. And, one of the biggest areas Turner discovered he was losing money was his internal businesses processes. Check out what he discovered once he started taking a closer look at things:

“We were constantly failing to adjust customers’ monthly bills whenever they would buy new IT products or services from us. For example, if a sales rep added 10 seats of antispam filtering to a law firm customer, the salesperson would be paid commissions for the sale, but often the message wasn’t getting to the billing department to increase the customer’s monthly invoice by $100 per month. Each error by itself wasn’t a huge loss, but combined, they become very costly.”

Internal errors weren’t the only source of revenue loss; he also discovered a couple of his vendor partners — including his cloud provider — were costing him money:

“[Our previous cloud provider] used a complex algorithm to determine customers’ monthly charges, which was impossible to figure out, let alone to explain it to customers who expected a flat fee each month. We ended up losing money on several customers’ cloud storage during months where they had spikes in data and/or bandwidth usage.”

Like Turner, so many business owners get so caught up working their business, that they just can’t seem to find the time to work on their business. As a result, what started out as good business processes and reliable vendor relationships can erode over time. Check out some additional words of wisdom Jim Turner shared with me by reading my full interview with him, titled: “Get Your Managed Services Act Together!

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