Should you choose a One stop Shop or go with Integrated Systems from Multiple Providers?
It's difficult to decide between a single solution and integrated solutions. No one can tell you which is best for you. There is no one correct answer.
The bottom line is that all POS, Shopping Cart and Club solutions integrate with other solutions. It is simply how we represent ourselves and our products that call ourselves a one-stop shop or not. We integrate with merchant gateways, shippers, and more.
Single service providers usually start by being experts in a particular area. One solution on the market today started as an accounting solution and grew to add POS, a club solutions and so forth.
The Benefits of choosing a single solution provider:
#1 – ONE-Stop: You get a one-stop-shop that may provide you with convenience of one place to go for service and support. Verify this as some companies that offer a single service solution are actually several companies who have merged together. Support may still be distributed to many locations.
#2 – INTEGRATION: Integration between multiple departments should be standard. With old technology, integration projects were costly. In today’s world, integration between different companies is not a significant task.
There are 4 immediate downside of purchasing a business-wide solution for your company:
#1 – RISK - All your eggs are in one basket. If the service or features of the software you purchased are not what you expected and you want to discontinue service, it can be a major expense to transition off the Single Service Provider’s solution. If service is great – you made a good decision. If service is not up to your standards, you may find your self “stuck” with little room for negotiations.
#2 – INVESTMENT = A COMMITMENT OF TIME: The investment that is required to purchase a company-wide solution from a single service provider is significant. Due to that investment, customers find that they are committed to a solution for several years. This can causes losses in productivity if the systems were not fully investigated by all departments, prior to the purchase.
#3 – OVERALL PRODUCTIVITY: Fewer Features may result in a reduction in your company’s productivity. Each department of a business requires specific knowledge and expertise. It's difficult to be an expert in all areas of business and provide the best features for all departments. A company that provides a system-wide solution has to make decisions on where to add functionality. Instead of being able to focus and spend development dollars on powerful features in each specific departments, companies must distribute enhancements across the entire solution. This often results in feature packages and upgrades falling short.
#4 – INTEGRATION – Today’s technology allows systems to easily integrate. If you like service provide for 80% of their product and want to add a service from a 2nd or 3rd provider, you should know in advance if the primary provider will allow the integration. Many companies are happy to integrate with other providers. This allows businesses to pick the best solutions for their own specific business needs. However, some providers refuse to integrate solutions as they don’t want the competition. This is a provider which makes decisions based on protecting their business and not on supporting their customers. This is a concern that should be questioned upfront.
Positives of Multiple Service Providers:
#1 – PRODUCTIVITY & EXPERT SOLUTIONS: The strength of selecting multiple service providers is that you can choose the features that best meet your specific business needs. People who specialize in one area usually become experts in their field. Accounting, Club programs, Shopping carts, websites, POS, Inventory, etc. all have their quirks. Hiring people who are experts in each area (or a few areas) can provide you with the strongest feature set. These features can be big time savers in the long run and are worth considering.
#2 – LEVERAGE COMPETITIVE SERVICES: As the providers know it is easy for you to discontinue service you can often leverage changing to a competitor if you have any service difficulties.
#3 – PRICE NEGOTIATIONS: Pricing negotiations can be leveraged for purchases and service when you have competitive offers on the table. This can be significant as the general rule for software is 80:20. The 80:20 rule is that the purchase price of software is 20 percent of revenue the provider generates from the sale. That leaves 80 percent of the revenue to be generated after the sale with upgrades, service, and price increases.
#4 – FLEXIBLE TO LEAVE: If you become unhappy with a provider and need to change providers, switching out a single service is much easier than changing an entire company-wide solution.
Downsides of using Multiple Service Providers
#1 – SERVICE: The largest concern is service. Coordinating service between multiple venders can be a challenge. If you have a vender who is not open to integrate solutions this may cost you some time. However, if you have a provider that is not willing to cooperate, then you can easily discontinue their service and choose someone who will. At least all your eggs are not in one basket.
It's a tough call as to which option is best for you.
Theresa Dorr
Active Club Management - Powerful and Affordable Solutions for Clubs
www.activeclubmanagement.com
925-447-CLUB (2582)
www.activeclubmanagement.com
www.acmwineclubsoftware.com
www.wineclubsoftware.net
Edited by Theresa (Wed Sep 12 2007 10:15 AM)
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