Telecoms Resellers who want to sell the new Cloud Based Communication Services have a challenge – how they turn their mostly CAPEX based business models into an OPEX based service business without destroying their cash-flow in the short term.
Many Telecoms Resellers who install and maintain PABXs (telephone systems) rely on the upfront profit generated from companies purchasing their equipment, whereas cloud based services are all OPEX based monthly service fees. These upfront margins generated from equipment sales help pay their staff and sales commission and without them it is hard to incentivise their sales people with very low month on month service fees.
However, Telecoms Resellers recognise that capital equipment purchases are on the decline as CAPEX budgets are cut (both in the public and private sectors). Resellers also realise that Cloud based software and telecoms services are expanding quickly and want to move to a more future proof business model.
Hybrid Cloud Communication Services can offer a potential answer because these types of solutions work with and complement the existing telecoms equipment supply model but also provide a way to move the reseller business over to a service revenue model in incremental steps rather than a big leap.
It’s also great news for the end customers who will see their initial PBX capital investments future-proofed, capabilities extended and allows them to expand their phone systems without requiring further capital investment.
For the reseller, the incremental service revenues generated from selling these new Unified Communication services will soon start to build up and eventually overtake the cash generated from the CAPEX sales allowing a far smoother transition to the cloud.