You know how when you have to fast 12 hours prior to a medical procedure, everything you see, hear, and smell reminds you of food? Or how when you’re considering buying a Honda CR-V, it seems like every fifth car you see on the road is a CR-V?
That’s how I’m feeling now about recurring revenue. I go south to Florida for the PAR PARtner Summit … I hear questions and comments about recurring revenue. I head north to Minnesota for a reseller workshop at CRS … questions and comments about recurring revenue. I stay in my office making phone calls and reading email … questions and comments about recurring revenue. I start writing this blog post … recurring revenue, of course! It seems appropriate that I share with you what I’m hearing and learning about the business model that’s the #1 focus for so many VARs and ISVs in the POS channel.
PAR PARtner Summit – Jupiter, FL
The most convenient way to communicate the recurring revenue chatter from PAR’s conference is to pull excerpts from my Twitter feed from the event.
- My first conversation at the @PAR_Tech #NextLevel Summit: one of the top US resellers sharing w/ me their quest to add more #RecurringRevenue. Analyzing data analytics partners currently. #CatchTheRecurringRevenueWave
- A highly-regarded reseller here at the @PAR_Tech #NextLevel Summit just made my day. He said he saw my list of 38 recurring revenue products and services at the @InsideRSPA Inspire Conference earlier this year, keeps the list on his desk, and ...
- ... has already converted two new services to recurring revenue for his business. It’s super-gratifying to see the work we’re doing through @Vantivip @Worldpay PaymentsEdge Advisory Services impacting our partners’ top and bottom line.
- “With a subscription model, there are different expectations from the customer. They keep paying for it, so there’s the expectation we’re going to keep upgrading it.” Paul Rubin, @PAR_Tech Chief Strategy Officer
- I just talked with a POS reseller who was beaming about his org’s recent success. His secret? (1) Shifting to recurring revenue biz model (2) Hiring for character; he held out for the right salesperson for his culture.
This final Tweet from the PARtner Summit has nothing to do with recurring revenue, but it’s a good segue to my trip to Minnesota (land of 10,000 lakes and sub-zero winter temps):
- I tell the bellman at the hotel here in Jupiter, FL I’m going to wait outside for my ride. He says, “It’s a little breezy.” I’m like, “I’m from Erie, PA where we shovel snow drifts in our shorts while drinking a cold beer.”
POS Reseller Growth Workshop – St. Paul, MN
Vantiv/Worldpay teamed up with partner CRS to hold a free workshop at their headquarters May 17. We invited area resellers to attend the three-hour event which focused on best practices for increasing sales, and the most spirited discussions centered on recurring revenue. Some workshop highlights:
- When I first showed my slide that lists 40 Recurring Revenue Products & Services offered by POS resellers, there was skepticism from a few of the attendees. “We don’t have a large staff” – everyone in attendance had fewer than 20 employees – “I don’t see how we can do that many new things.” I shared that I’ve seen organizations with as few at six FTEs (full-time equivalents) execute on 38 items on my list. They do that thorough automation (e.g. PSA software, remote monitoring software), leaning on vendor partners for heavy lifting, and acquiring only customers who fit their managed services business model. It takes initiative to start down the recurring revenue path and rigorous discipline to stay on it.
- One VAR said he was selling an online ordering solution to his merchants but was struggling with the overhead it caused. He told the group he was planning to drop that offering from his linecard to which most everyone in the room responded, “No!” (In a Minnesota-nice way, of course.) The discussion revealed that this reseller’s online ordering wasn’t integrated with the POS which was causing him extra labor, rework, and headaches. We talked as a group about the importance of integration and automation in order to make the recurring revenue business model work. You can’t execute on the as-a-Service model using manual tools from days gone by.
- That anecdote also revealed the importance of selecting the right vendor(s) when you’re expanding your recurring revenue menu. Other resellers in the room who chose POS software and online ordering vendors who integrated with each other were feeling all benefits and no pain.
Emails – Erie, PA
Despite trying to keep up with email on my phone, my inbox was stuffed when I returned home from Minnesota. I saved two of my email exchanges with channel executives to share with you:
Thanks for sending over your latest list of potential recurring revenue sources. What are Facebook services? That’s one I’m struggling to grasp.
I’ve only talked with one reseller who does this, and their explanation was that for a monthly fee they will create and manage the content on the merchant’s Facebook page. It’s similar to web content management and digital signage content creation where the reseller acts as a “publisher” for the merchant. It’s not giant revenue, but it’s another service that creates MRR (monthly recurring revenue) and a stickier relationship with the merchant.
We are working on our first SaaS deal with an ISV partner for the project. Any thoughts/comments on structure of legal agreements including customer agreements and things to include?
Thanks for reaching out to me – glad to hear that you’re moving forward with a SaaS deal. You are certainly on the right path updating your agreements to make sure you’re protected. Here are a few options for you:
- If you’re an RSPA (Retail Solutions Providers Association) member or CompTIA member, they have reseller-friendly legal templates that should cover all those areas. I believe those templates are free to members.
- If you’re not a member of either of those associations, there are some consultants who might be able to provide you with that information for a fee. Consultants I know who I believe can help you include:
- Finally, I would recommend connecting with reseller colleagues of yours who have experience with as-a-Service agreements. You can pull language from their contracts. Bottom line, there are several VARs who have experience with this so you shouldn’t have to start with a blank sheet of paper.
RetailNOW 2018 – Nashville, TN
I don’t have a time machine, but I guarantee Aug. 5-8 I’ll have recurring revenue on the brain when RetailNOW takes place. I’m moderating two sessions titled “How Leading POS Resellers Implement Recurring Revenue Products & Services.” Our industry’s top-performing resellers regularly add new recurring revenue streams to their offering. This session will go in-depth with executives from those organizations detailing how they select, evaluate, bundle, market, sell, and service their recurring revenue products and services. We’ll discuss headaches and success stories plus practical tactics and techniques for transitioning your business to the highly profitable recurring revenue model.
These six industry experts have committed to share their experiences, and we could add a couple more between now and when the show kicks off:
- Josh Byers, Lonestar POS
- Jeremy Julian, CBS NorthStar
- Mike Maudlin, C&M Business Machines
- Scott McClannahan, Simple POS Solutions
- Chris Rumpf, Flyght
- Jim Stewart, Advanced Data Systems
And if you can’t wait until August for more recurring revenue information, watch the on-demand version of my latest PaymentsEdge Advisory Services webinar: 40 recurring revenue recommendations for profit-conscious POS resellers. I’ll be playing it on a loop until my laptop wears out … because you can never hear enough about recurring revenue!