There was lots of interesting content out there in the past week or so but the most interesting and perhaps overlooked ones are about the new trend where SMBs are starting to avoid large vendors, another factor when choosing SaaS vendors and the funding of cloud services tracking startup, Cloudability.
(By the way, we are in no way affiliated with any of the companies mentioned in this post)
Small companies abandoning large vendors
CloudPro identifies an interesting trend in this recent article of theirs. Cloud-based CRM provider Workbooks claim to have most of their clients have a legacy, on-premises solution for their CRM needs and come asking for a more modern, flexible and lean cloud approach.
That’s to be expected, but in addition to this, Workbooks Online notices a flow of SMB customers from large providers – namely Salesforce – to their customer base. In other words, an increasing number of small business try their luck with an established, enterprise vendor – and then decide to abandon them and adopt a smaller, leaner provider.
The cited reasons are cost & customizability but obviously the trend is much broader. Overall, it makes sense. It is easy and cost-effective to identify other, more viable vendors – or even to hire a consultant to do that for you. Once there, it’s only natural for an SMB to decide to jump ship for a more efficient solution – it has the flexibility to move that fast and comparatively minor change management pains to address.
Future-proofing yourself from your vendors
Chris from VM Associates has an interesting insight about companies offering Software-as-a-Service. In essence, he provides a couple of other factors regarding how to choose such a company, e.g. to handle your CRM or ERP needs.
It’s all about reliability in the long term really – since most of the times we’re not talking about established companies of considerable impact and size (e.g. Microsoft or SAP), there is always the danger that your vendor will either shut down completely, be merged or taken over (and then shut down) or similar disaster scenarios.
Actually, it may or may not be a bad thing for them, but it’s definitely a huge issue with whomever has included the company in their workflow and now have to change everything to an equivalent solution, migrate data, train their staff etc. So a bit more preparation when choosing providers is a good idea:
- The younger a company the more volatile it (still) is – obviously months old ones are risky but once a few years have set int they should be ok.
- If a company has taken external funding there is pressure to pay it back – quickly and in volume. This means going for an all or nothing approach – which usually turns out to be nothing.
- Is enterprise the target group – and only incidentally do they offer a ‘Basic’ SMB-oriented account? If so, that’s a giveaway of a (hoped) buyout and subsequent changes down the road.
In short, answering questions such as the above should part of an SMB’s evaluation when choosing a vendor who may themselves be an SMB. And in case you’re wondering, we’re less than 3 years old, with no external funding and our main target group is SMBs – but with strong enterprise options though.
Putting the cloud in order
Now such an infuse – apart from providing additional pressure for the company to perform – is a huge confirmation of their business model. Cloudability aims to help you keep track of all your cloud-related costs, from monthly fees to usage spikes related e.g. from unpredictable online traffic to your business, etc.
Given that more and more business functions are transferred to the cloud we agree that services such as Cloudability will be more and more crucial for the modern online entrepreneur.
Dimitris Athanasiadis oversees Operations and Customer Relations in Megaventory.