The work of resellers is critical to the health of the two-way radio industry. Just as a tree cannot survive without its roots, manufacturers and distributors cannot survive without the resellers that sell to and support customers at the local level. At the same time, if profit margins are to be preserved across the industry then resellers have to avoid competing on price alone.
Richard Russell, business development manager at Tait Communications, argues that for resellers, competing on price is “often not sustainable” and adds: “A radio system sold on price may not be designed properly, configured correctly or installed appropriately. This can result in a bad experience by the end-users, even cause interference to others and impact their communication.
“Differentiation is therefore crucial to the long-term sustainability and profitability of resellers and manufacturers. If a radio device becomes a commodity then it loses its value and it becomes a race to the bottom and everyone loses.”
So, how can resellers differentiate themselves from the competition? It could be argued that the ‘default’ way in which resellers have historically differentiated themselves is geographically, although Guy Hopkins, managing director of Logic Wireless Europe, says: “In the radio industry it’s pretty much every man for himself and [you do have] companies competing for bids quite a distance away from where they are located.”
This is enabled by the “shift over to IT and the ability to remotely monitor, diagnose and even fix faults remotely… so you could have a customer that is up in Scotland and is being served by a [reseller] down in London”, Hopkins adds. While this is not always appropriate, particularly for mission-critical deployments, where resellers able to provide 24/7 support and rapid turnarounds may have an advantage and be able to command a premium, it will be interesting to see how resellers’ natural territories evolve, especially once PTT over Cellular grows in popularity.
An alternative strategy is to focus on one or more vertical markets – which is what Radiocoms has done. “We’ve picked some key sectors and then have our sales staff trained so that they understand that sector better than competitors, says Mark Blythe, director at Radiocoms. “If it’s a fire and rescue service for example, we have a salesperson and an engineer that work just in that sector who learn about how they use the equipment. We make sure we understand the sector that we’re working in and then when customers in that sector come to us and ask questions about a requirement we can point them to our previous experience, advise them of what we’ve done and how we’ve done it, along with probably how to resolve some of the issues that they’ve come across.”
Blythe adds that as part of Radiocom’s focus on local and central government customers, it has had to slowly build up the qualifications they require over the years. “Many of the tenders that we look at require ISO9001 for quality, [ISO]14001 for environmental, [ISO]18001 for health and safety, and we have recently added Cyber Essentials and [are] reviewing the requirement for ISO27001. It has become a mandatory requirement to have all of those qualifications.”
Hopkins highlights the difficulty resellers have when it comes to differentiating themselves from the competition “because they’re all pretty much selling the same [products from] the same manufacturers, [and] if an opportunity comes up and you’ve got three or four companies going for it, nine times out of 10 they will all be proposing the same solution and then it comes down to a price battle… the good resellers that we work with, that are able to separate themselves from the competition, think about it in a different way. They look to present not just what the customer has asked for, they also try to see if there are any other problems that they can solve for them as well.”
He adds that resellers should ask themselves how the system they are proposing is either going to save the client money or perhaps “solve a key issue, for example improve health and safety, protection for the employees, save on insurance premiums and give better job satisfaction because the employees know they’re being properly monitored and protected. [They need to] talk about the wider business benefits [to] the organisation, not just focusing on the technology.”
However, Hopkins says these “business benefits” have to be presented in a coherent manner, and “the way the end-clients are looking to procure radio systems now is changing”. He adds that end-user organisations’ “radio experts” are fast disappearing, “so a lot of people who are looking at the procurement decisions don’t know anything about radio, they come from an IT background and they just see the radio as a piece of the wider ecosystem”. At the same time, customers now expect to see “proposals and marketing and sales material [and demand] quite complicated and extensive pre-sales activities – a lot of the resellers simply don’t have those resources and skills available. So, where we’ve been trying to help the resellers [on] the pre-sales side is maybe help them write proposals, help them with their marketing and sales activities [and] respond to tenders, [as] that’s a quite a costly thing for them to do and they don’t always have the resources and the money to do that themselves.”
Hopkins adds that at the same time, young people are increasingly handling procurement for end-user organisations and they tend to “procure and source systems in [a much different way from their predecessors], so social media, [the] internet, YouTube, videos [all play a part]”.
Going up the value chain
One of the key ways in which resellers can move away from a commodity-based business is to gain the expertise and confidence required to sell large, high-end two-way radio systems. Blythe says: “The larger manufacturers have been very helpful with [that], so what we’ve generally done is put together a design [in-house] and then put [it] to the manufacturer (generally it’s Motorola Solutions or Hytera for large systems that we’ve worked with), discussed it with them technically and they’ve come back with any feedback. Each design change is documented and [we] make sure that any changes are implemented into the next system. ”
Tait’s Russell adds that his company provides “reseller support through official online training from entry level through to in-depth technical solutions, hands-on detailed training on how to configure and optimise bespoke equipment and entire system solutions and [more]”. It also offers its resellers services “that include conceptual system design, ensuring the correct RF coverage with a balanced RF budget with contingency fade margin and frequency planning”.
It’s worth noting that the support that manufacturers can offer extends beyond technical support and training. For example, Matthew Napier, channel sales director at Hytera, adds that it and its distributors also provide “financial support for websites, campaigns and events. We (Hytera and distribution partners) offer direct pre- and after-sales support as and when required. We also ensure that capable resellers are openly shown as partners of Hytera and we plan to make it far easier to ascertain which resellers are most capable in each technology/discipline.”
CRM and business processes
As a reseller’s business grows, procedures and administration systems that were previously fit for purpose start to creak under the strain. Even before that point, Sam Ogles, sales and marketing executive at Syndico, recommends the use of customer relationship management (CRM). He adds that since Syndico (while it is a distributor rather than a reseller, the underlying problem – handling an increased number of customers/orders – is the same) implemented its CRM system just over a year ago, “the operational side of our business has just improved so much. The number of errors has gone down [and] the transparency of every process has improved.”
He adds that the latter aspect is particularly useful when trying to resolve a customer’s technical issues or problems with “a certain system that you’ve put in place”, as you can then look back at a full audit trail that can help you understand how the issue arose in the first place. This capability is made all the more valuable, given that there is “a lot of mission-critical communication systems that need to be right all the time”. Ogles adds that there are plenty of CRM systems on the market, and while it is possible “to spend a fortune” on them, “the amount that you can get from a platform like MailChimp is really good, and for a lot of small businesses in particular that might be the only tool they need”.
Ogles says Syndico’s use of a CRM system has benefited its sales team. “We have a dedicated salesperson who is out on the road four days out of five; he was having real problems keeping up to date with what was going on apart from the one day a week that he was back in the office. Now all he has to do is to log into a CRM system before he goes to meet a customer and he can see every quote that we’ve done for them, every case that’s come up for them, every task that somebody has done in the office which relates to their account – any problems, any good/bad feedback.”
It’s not always organic growth that triggers the need to formalise and professionalise operational procedures. Radiocoms’ Blythe says when his company acquired London Communications PLC in 2010, the overall business’s size increased by more than 70 per cent, and this change required the introduction of standard operating procedures, CRM and other back-office computer systems, “so it didn’t matter who came into the business, they could pick up the manual and they could understand the processes.
“As a business we probably underestimated the amount [of] time and work that took to implement [these]. Although a painstaking task, the work completed in those first two to three years set us up to the next level, so we now have the systems in place that means that we increase the business by another 30-40 per cent and still know that we can manage that level of business.”
CRM systems can help sales staff keep track of when it is time to get back in touch with customers. Ogles says this after-sales contact is important, as even in the case of e-commerce-focused resellers who might be prioritising providing the best possible price for certain products, “with every sale, there’s always a potential for another sale”.
He adds: “Our best resellers have a clear plan to make sure no sale is wasted, in the sense that every sale they make could potentially result in another sale, but also to make sure their relationship with the customer goes beyond the sale. [After] a certain amount of time after a sale, whether it’s a radio or a big system, they will always follow up with that customer and nurture that relationship, so even if two years down the line there’s another opportunity, they will be the first people with a chance of getting that business.”
No single point of expertise
Radiocoms’ increased scale from its acquisition of London Communications created a need to have a broad skills base across the whole business. “We tend to find that some people will invest [in] one or two people in the business, but when you’ve got multiple contracts and you’re trying to support them 24/7, it’s absolutely critical that a large number (if not the majority) of [your] staff receive that training, so you’ve got a high skillset throughout the business rather than one or two specialists being supported by a more junior member,” says director Mark Blythe.
Another benefit of this approach is the way it improves the business’s ability to continue trading as normal in the event that several key staff were to leave. Blythe adds that such a situation “can be a huge risk to a small business; if they are dependent on an individual or even two then [they are] very much at risk [from a] business continuity [perspective]”.
