CIS Consulting Group has sold its 24-year-old practice to a variety of interests, including a software company it once represented.
The firm, which also represented Sage’s Master Builder and Viewpoint Construction Software, sold its Timberline and Master Builder business in December to Maumee, Oh.-based reseller Aktion Associates Inc., top Sage partner Alliance Solutions Group, and Sage itself.
Specifically, nearly 1500 Timberline and Master Builder customers and 20 CIS employees went to Aktion Associates, and 400 customers – all on the West Coast -- are now handled by Alliance Solutions’ Manhattan Beach, Calif. office. The firm has sold Timberline for 17 of its 24 years in business. CIS also had Colorado-area customers, which are now being served by Sage direct sales.
CIS principals Chuck Elyea and Jim Campbell, as well as four sales reps, a marketing manager, two consultants, and a programmer are now a part of Viewpoint Construction Software, which will maintain an office in Charlotte, giving the Portland, Ore.-based company an East Coast presence.
The decision to essentially dissolve CIS Consulting came quickly, and was not without challenges, according to founder and chief executive Elyea, but it was one that had to be made.
Elyea noted the construction industry has been in a downturn in recent years, and as such his firm has seen some difficult times. He also said that pressure from Sage made it even more problematic to function without layoffs, as sales margins were trimmed because CIS was carrying a competing product, Viewpoint, which it only started to represent last April.
“I understood their point of wanting to make the channel stronger, but when I decided to be honest and spoke to Sage execs about our plan and how to minimize conflict, they couldn’t drop the fact that we were competing with them [by also representing Viewpoint], and they just made it difficult to do business,” said Elyea. “They initially said the only penalty was going to be losing a few points on commissions, but that wasn’t the case and their actions potentially threatened my business. I had the option of playing it out or just dropping Viewpoint, but with the current state of the market, I’d have to lay off 10 people, and I didn’t want to lose them.”
Elyea explained that late last year, he approached Aktion, whom he’d had a good and “trusting” relationship with, about buying the practice. They agreed and worked out the terms. However, Elyea claims Sage blocked the sale to Aktion, saying the entire practice could not be sold to just one firm and “strongly suggested” their West Coast business be sold to another major Timberline reseller and top Sage partner, Alliance Solutions. Sage in turn decided to service CIS’s Colorado clients.
While Sage did not comment on the specifics of this transaction, Jon Witty, vice president, and general manager for Sage Construction & Real Estate solutions, issued a statement on the matter.
“The construction and real estate market continues to be challenging,” he said. “Under these conditions not all businesses will meet performance expectations. When this happens, companies look at best options to refocus their efforts and exit the business. We understand this is the case with our former partner, CIS Group, and we wish them the best. Sage Construction and Real Estate continues to see strong year over year growth in license revenue and new customer acquisition through our partners. Through this partnership, we remain the market share leader and the gold standard in construction.”
For its part, Aktion would not have been able to properly service CIS’s West Coast clients, as it primarily focuses on Midwest business, according to Aktion director of marketing Libby Beemer.
“We have a very strong business here in the Midwest and around our headquarters here in Ohio,” said Beemer. “These are our roots, and we made an effort to cultivate that territory, as well as experiencing significant growth with all of our industry verticals, not just Timberline and construction. I think this acquisition really made sense. It’s a geography that’s close to us, and we’ve always had a good relationship with Chuck [Elyea] and CIS. They have a similar business model, but with their other customers [in Colorado and California] the territory is significantly further away than where our focus is right now, so it didn’t make sense for us to pick up that part of the business.”
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