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Some of Incortech's clients that typically spend $30,000 to $50,000 a year on services hadn't purchased anything but an hour of support help in the past four months.
Then came the layoffs.
His clients' employees started approaching him claiming to be power-users of the Sage products the VAR resells and asking for jobs in anticipation of losing their positions.
These were controllers, CFOs and accounting managers. Then he called a 300-person manufacturing company and the president answered the phone.
"We thought, 'This is not good. How are we going to stay in business through this,'" Birdwell recalls.
Well, when the selling gets tough, the tough get creative.
"We [decided] we're going to have to make it easy for our prospects to find us on the Web. If clients aren't buying and suppliers like Sage and Intuit don't give us leads, we have to generate our own."
Aggressive growth requires companies invest roughly 15 percent of their gross revenue on marketing, Birdwell estimates, but Incortech was only spending 1 or 2 percent.
"Marketing was an event, not a process," he says. "It was a matter of go grab a few leads and then stop to sell."
The process had worked for the VAR up to that point, with Incortech earning top sales recognition for Sage's MAS 500 product for several quarters. But now Birdwell needed to adapt to the fact that manufacturers in Southern California just weren't shopping - at least not at his store.
He hired a woman from Duct Tape Marketing for whose services he was reimbursed 50 percent as part of Sage's co-op marketing dollars.
The initial 12-week program to analyze Incortech's business consisted of weekly calls about different topics every week and then developing a marketing plan for the VAR, totaling $5,000 (of which Birdwell paid $2,500).
But Birdwell wanted more, namely a way to execute on that plan.
"I didn't just want a to-do list. I wanted her to also tell me how to do it and give me the people to do it, because I don't have them," Birdwell says of his 10-person business. "It was more than double the original estimate, but I knew I would be wasting the first half if I didn't do the second part."
| Visiting Customers and Prospects|
No matter how much the Internet lets consultants connect to clients and prospects, there's no underestimating the power of face time, especially in a down economy.
Sixred is a reseller of Intacct and NetSuite, both Web-based products that partner Sean Heneghan could demo remotely. Nevertheless, he chooses to focus on areas his teams in Dallas and Chicago could drive to easily, which he says has helped him compete.
"It's important for opening meetings and discovery sessions. If Intacct's second or third in line and no other people showed up, we've closed the deal," Heneghan says. "When people don't want to spend money, actually seeing a face helps them feel better about it."
His company usually conducts a two-hour whiteboard session, which his prospects-turned-customers say make them feel as though Sixred understood their business more.
Steve Birdwell of Sage VAR Incortech, says his firm is cutting down on using GoToAssist remote help during support calls and asking to stop by the clients' offices instead.
At the end of a call, when consultants ask whether they can help with anything else, clients usually say no and hang up. In person they ask others whether they need help, and often they do, he argues.
"In the office, you can turn a two-hour support call into an entire day, and they're happy because you're adding value," he says. "We're also doing more drive-bys. It's like the route salesmen used to do. With gas prices, it's not practical to just drive around without business, but if you're in the area and it's on the way, it's worth it and clients feel we're more in touch with them."
Otherwise, they could just get support from the vendor over the phone.
The first thing he did was change his vertical focus from manufacturing to professional services and people-based businesses such as engineering companies or architect firms and picked up two additional product lines-Deltek Vision (for project-based businesses) and Intuit's QuickBooks Enterprise Solutions.
Then he assigned one of his own employees to revamp his Web site (which had barely changed in three years). After all, the employee wasn't as busy as usual and had an extra skill set he could use. Birdwell also used outside experts for Search Engine Optimization and Google Analytics, a free tool to measure traffic.
By the end of October, the investment had already paid off.
"In the last five years, we got one lead off our Web site, we are now getting five to 10 leads a week. And these are good local companies that have software and need help, or they're looking for software or an upgrade or add-ons for Sage and Intuit," he says.
Incortech received about six QBES engagements within two months of the new site going up, with six more expected to close in the near-term. The VAR received top sales honors in the United States for Q32008 for QuickBooks Enterprise after being a partner for four months.
Since starting Google Analytics on July 1:
*Web site visits per day had gone up more than 1,000 percent.
*Average time visitors spend on the site had gone up exactly one minute for each visit - which Birdwell attributes to more interesting/relevant content.
*Pages viewed per visit was up almost 10 percent.
*And new visits were down 2.5 percent, which means more repeat visitors.
Surviving through a tough economy does mean just attracting new business, but also staying connected to current clients. That does not mean forcing them to buy things they don't want, but checking in to see whether they are OK and whether consultants can do anything to help.
One QuickBooks consultant, Laura Madeira, has seen a 220 percent increase in software consulting revenue from January to September 2008 compared to the same period in 2007 due, in part, to an increase in billable rates for services by both current and new clients.
Madeira, who also consults on Sage Master Builder, also experienced a 385 percent increase in gross software sales, particularly in construction and manufacturing/wholesale verticals and a gross profit increase of 241 percent.
"We see a renewed interest by prospects in taking care of their business financially first and foremost, and they don't want to wait for months to get that type of reporting," Madeira says. "Additionally, a good number of our new customers are subject to more restrictive banking lines of credit, so having reliable financials for them is the only way they can stay in business."
Madeira is busier than she's ever been before and she attributes that to the fact that every dollar counts to her customers and prospects. And software is what they turn to in order to keep track of those dollars.
"Companies are downsizing, and with that comes performing more tasks with less. There's a huge market for buying software to solve that need," she says. "We teach them how to use the software to be self-sufficient."
In certain parts of Texas, where Madeira is based, construction companies are doing well, but they come to her in order to track costs better and collect money faster.
Smart companies are using downtime to find out how they can be more situated to handle volume in the good times, she says.
"Unless they're brand new, they've been through good times and bad. They realize this is not a permanent downturn in the economy, it's just a setback," Madeira says. "They see the opportunity to learn when they have time. They're spending money on my consulting to do that."
Investing in Software
As far as investing in actual software, most resellers and the vendors themselves say customers are willing to spend if they can see how the applications will either save money or boost productivity.