Is Wholesale Mobile Right For You?
Posted on September 11, 2012
Moving into mobile can be a richly rewarding experience for the traditional comms reseller. With mobile data becoming a dominant force in today’s converged network arena it’s no surprise that more companies are reinventing themselves to complement existing products and services.
Choosing the right path is often the key to success – for new or existing mobile providers. Should they embrace a commission-based model or partner with a wholesale provider? It can be a difficult conundrum.
To help cut through any confusion and provide an objective viewpoint, distributor Nimans has produced a handy guide entitled: Is Wholesale Mobile Right For Me?
Ultimately it’s not good burying your head in the sand. The reality for resellers is that many of the networks have moved into other arenas such as fixed line, broadband and data. Potentially a reseller risks customer erosion and losing margins.
Wholesale gives them complete control so that they can bill under their own name and retain client ownership. WholesaleMobileoffers a host of opportunities for resellers both from a customer retention and cross-sell position and to increase business value. But it’s not for everyone. Resellers need to realise that customers will come though to them for orders, hardware support, billing enquiries and faults, so they need to have the necessary resource to manage this.
As a wholesale service you own the customer and it’s your financial responsibility. This means you do the billing, the credit checking and ultimately take on the retrieving of your customer payments and arranging of customer agreements. With this in mind you need to ensure your mobile services provider can support you in these areas, such as offering a bureau billing service and providing comprehensive training when you become a wholesale partner. As you own the customer you will also take on first line technical support.
O2 Wholesale for example is a SIM only model, meaning handsets are not included or subsidised as part of the deal. With this in mind, if your customers require handsets it’s helpful if your wholesale service provider can offer you leading models on a SIM free and network locked basis.
You need to be prepared to consider ways of funding handsets for you and your customers. There are a few ways to establish a ‘kit fund’ and your wholesale provider should be able to offer advice on this. Leasing is another tangible solution as it relieves any cash flow problems that may occur if working capital has to be used to purchase hardware.
If you decide you don’t want the responsibility of doing the billing yourself and collecting customer debits, you may want to consider a mobile service provider that offers white label bureau billing services. This will help free up your time should you choose not to manage the billing yourself.
Whether you are currently selling mobile through a commission structure or deciding to offer mobile for the first time, there are many things to consider. The truth is, wholesale mobile isn’t right for every reseller. But for those that it is, it really can make a positive difference to revenue streams, profit margins, business value and customer retention.
With the increase in remote and field based employees, mobile spend within organisations is naturally on the rise as well. As well as fixed line, calls and broadband, mobile makes up a significant part of a company’s communication spend today, so by being able to offer mobile and bill along with all other network services, this adds significant value to a reseller's offering.
Mark Curtis-Wood is Head of Networks at Nimans.