Manufacturing matters above all else to MISys, founded in the early 1980s as Manufacturing Information Systems. MISys formed as a vertical application designed to work hand in hand with Sage's Accpac ERP system.
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Like Accpac, MISys SAE was-and still is-sold primarily through the channel, which today has grown to roughly 200 resellers worldwide, many of whom got in from the ground floor.
"Because Accpac was being sold by the channel, we quickly saw that was a very large, very capable sales force that saw the value in (MISys) for them," says Scott Beavers, vice president of sales and marketing for MISys. "Why would we go out there and hire loads of sales people when this was staring us in the face?"
Many of those resellers already had customers in the manufacturing space but were looking for functionality specific to that industry.
MISys Manufacturing starts with core modules companies need in Level 1, including Inventory Control, Multilevel Bills of Material and Job Tracking. Then, as companies grow, they can move to Level 2, which includes Master Production Scheduling and Material Requirements Planning, and to Level 3, which includes more complex shop floor controls for keeping detailed track of shop operations and the stages of various orders.
ADSS Global serves about 1,400 registered Accpac users, of which about 50 also are MISys customers that start as small as $3 million companies with two to three users, though the typical size is 10 to 15, according to vice president James Campbell.
Campbell points to MRP and master production scheduling as two features that serve his clients well.
"With MRP, I can see if I have enough materials to make what the customer orders and how long it will take," Campbell says. "Master production scheduling [shows me if] I have time, resources and plant capacity to make this stuff."
The answer can be yes, but doing so may put a company behind because of other projects coming down the pike, he explains.
Some of that functionality is a bit too complex, or costly, for smaller companies, however, which served as a deterrent to both the vendor and resellers looking to sell downstream, according to Beavers.
So MISys created a scaled-down product called MISys Small Business Manufacturing in early 2006, looking to serve smaller companies through those who sell QuickBooks, Peachtree, Simply by Sage (in Canada) and Microsoft Office Accounting.
"It hatched out of the fact that we and our business partners were getting frustrated with having to walk away from deals because it was too expensive or [the prospect] didn't have Accpac," Beavers says, adding that MISys and Accpac each cost about $10,000.
MISys SBM was built on .Net technology and is sold in seven different modules, at about $1,500 each, plus $1,000 per concurrent user. This year, the company added a version for Accpac as well.
"You can splice out what you don't need and it costs less even though you get the same functionality pretty much," Beavers says.
SBM is a perfect segue for Forepoint, an Accpac reseller that has about nine or 10 of its largest clients using MISys but that is looking to add different products to its mix this year, including QuickBooks.
"We wanted to specialize in a strong vertical, but give small clients a good strong solution with the ability to move into Accpac as they grow. It becomes a feeder," says Forepoint vice president Sonia Gray.
Only about 25 resellers have signed on to this program, but the number is growing, especially since MISys inked a deal with the Sleeter Group for its QuickBooks consultants to become MISys SBM VARs as part of their Sleeter membership at no additional cost.
MISys does sell this product direct because it had to start from scratch with only a handful of Accpac dealers but Beavers hopes to grow the channel to as large as that of the SAE product with support from inside sales.
The costs and requirements associated with each product are slightly different.
Both start with what Beavers calls a "get-your-feet-wet" level, where potential VARs could test the software. The cost to get in the door is $249 with a $110 annual renewal for SAE and $100 with a $100 annual renewal for SBM, plus a 15 percent margin for anything sold. This is called a "reseller" on the SAE side and a referral partner on the SBM side.
"The reality is very few people at that level end up selling the product. It's more a chance to evaluate the product and get involved with us," Beavers says.
There is a separate Web affiliate program, however, to simply give MISys the name and number of prospects. If the vendor sells it, the person doing the referring gets a check for 10 percent.
Tier 2 ups the investment and the benefits.
For the flagship product, the Tier 2 category is called Business Partner. The cost is $1,195 plus a $250 annual renewal. This level entitles members to a 25 percent margin, unlimited technical support, lead generation, and ongoing training workshops, along with a listing on the MISys Web site.
Gray and others applaud the unlimited tech support, though she wishes the hours were longer.
"I've always really appreciated their tech support. They return calls and emails promptly, they're clean and concise and descriptive," Gray says. The only problem is that she's on the West Coast, and support hours end at 5 p.m. eastern. "If I'm in a sticky situation, I have to time it with tech support. If it's 5 o'clock, you can bet you're not going to get a hold of anybody."
On the small business side, a Tier 2 partner is called an Authorized Reseller. Participants pay $995, with a $250 annual renewal. It comes with much of the same benefits, but a 35 percent margin.
Both types of partners can take advantage of the vendor's Professional Services Group, which provides free help with demos, needs assessments and other sales assistance, but takes back 10 percent of their margin if a deal is sealed.
"They're willing to take a hit on margin because PSG is a huge help," Beavers says.
The top level is called Certified Business Partner in SAE and Certified Reseller in SBM.
Certified Business Partners are required to take two courses - Basic and Advanced - that cost $1,500 each. Upon completion, these partners receive a 35 percent margin and the best sales leads the internal team receives, as well as priority on tech support and discounted retraining.
"We don't believe business partners are some great profit center for us," Beavers says, adding that there is no sales quota. "If a business partner sells more than $25,000 of MISys software, we waive the renewal fee next year. That's one very good sale or two sales."
On the other hand, sales volume rather than training drives the Certified Reseller designation.
Small consulting firms tend to have a harder time learning a vertical market and selling a manufacturing application, so almost every SBM sale will work with a PSG person and have access to online user group meetings, Beavers says, adding that his goal is to have those VARS eventually feel comfortable selling on their own.
As a result, if Certified Resellers sell three systems in the calendar year without help from the PSG, they get bumped to a 50 percent margin, which is retroactive for that year.
Another added bonus this year came in September, when MISys acquired Sage's Endorsed Development Partner designation, which means that MISys is on Sage's price list so Sage resellers can have their MISys sales count toward Sage's tiered margins.
Not only does it benefit MISys-Beavers says that some resellers would focus more attention on Sage products to hit their quota in the past-but it cuts down on having to deal with multiple companies.
Jan Senecal of Answers Accounting, of southern California, has been an Accpac and MISys reseller for more than a 12 years. She's used the PSG extensively for presales support and is delighted that she can go directly through Sage rather than splitting customer orders.
"Now I can place everything directly and it hasn't impacted my margin from MISys, which is awesome," she says.
Alexandra DeFelice is Associate Editor of Accounting Technology and can be reached at email@example.com.
Headquarters Woodstock, Vt.
Number (802) 457-4600, Ext. 286
Web site misysinc.com
Number of resellers 225
Key products MISys Manufacturing System for Accpac ERP; MISys Small Business Manufacturing for Accpac, QuickBooks, Peachtree, Simply by Sage (Canada), Microsoft Office Accounting