Hi Folks,
I created an account here to clear up some misinformation. I’m John, the owner of an IT Solutions company in the greater Chicago area. You’re a little off base- they don’t connect IT companies with clients, they connect IT Companies’ Clients with Broadband and Telecom companies. If you help your clients find broadband or telecom services, and you’re not receiving monthly revenue from it, please read on.
Sandler Partners is one of the largest, if not the largest, of what are called Master Agents. They are essentially aggregators of businesses that are selling broadband and telecom services. There are several of these such as Intelisys, Telarus, Telecom Brokerage, etc. Essentially what they do is help you to get bids and sell telecom services. I’ve just learned about this over the last year, and so I want to share my experience.
First of all, vocab time. You have NRC and MRC. NRC is Not Recurring Charges, or one time charges. MRC is Monthly Recurring Charges. Next we have Commissions and SPIFS. Commissions are just what they sound like, it’s a commission on the MRC that you sell (excluding taxes.) If you’re in a master agent’s top tier, you can expect your commission to be 80% of the MRC. SPIFS are Special Pay Incentives for Sales. SPIFS are one time payments to the sub-agent (you) based on x times MRC. Last is Evergreen: An evergreen contract is an agreement between parties that automatically renews (or rolls over) after each maturity period or completion, unless one of the parties gives notice to terminate or defaults. These master agents set up evergreen agreements with most providers to ensure that the commissions continue to come in.
So, here’s an example:
I sell a 10 seat Hosted VoIP system from Voyant to a client, and their NRC is $50 (for shipping) and their MRC is $250 + tax, or $300 total.
Voyant (as an example, not really) has a structure as follows:
25% Commission, Evergreen
5 Seats = 1X MRC
10 Seats = 2X MRC
25+ Seats = 3X MRC
So on that Voyant deal what would I get? Well the amount agreed upon with Voyant is what the MASTER AGENT gets. So to use Sandler as an example, they would receive $62.50/mo. (25% of the $250) from Voyant. The agent (in the correct sales tier) would then receive 80% of that, or $50. Every month, as long as that client remains a customer of that company. Holy recurring revenue! Not bad, but they also have a SPIFS specified… so the sub-agent (you) receive 2X MRC, or $500 just for making the sale.
So some folks will say, eff that, I’m not taking a percentage… I’m losing money! I thought so, but it turns out, until you’re really big, churning $100k+ in new deals per year, that it really makes sense to partner with a master agent. Using the Voyant example above, let’s say I register with Voyant to become a partner and resell their services. They know that I’m a smaller player, so they don’t have to pay as much. They offer me a commission of 12% and SPIFS of 1X MRC for 25+ seats. Taking my 80% share of 25% is better than taking 100% share of 12%. Make sense?
There’s one more thing. Buried in that Voyant contract is some details outlining that if you don’t maintain $1,500/quarter in new sales volumes that all commissions will stop being paid. What if you have a bad quarter? You lose that monthly recurring revenue, forever! The same clause is in the contract Voyant has with a Master Agent too, but guess what? Sandler as a ‘master’ partner has the ability to stay above those sales numbers, because all of our sales count towards that number. It’s literally power in numbers! So partnering with a master agent is a no brainer if you ask me. I’ve helped my clients for years purchase and install broadband and telecom services, and I didn’t realize I was leaving money on the table.
The last thing a Master Agent will provide is muscle. Let’s say you have a customer struggling to get support from Comcast/Charter/Spectrum, etc. You can go through the normal business support channels and not get anywhere… but after you try that, you can go to the Sandler escalation contacts (if it’s a Sandler deal.) So then Sandler calls on behalf of this customer, the same Sandler that is bringing millions of dollars into these companies each year. Guess what happens? It gets attention, immediately. When your customer’s phones are down, it’s something you want to have in your back pocket.
I’ll tell you that I was very cautious, and I shopped master agents pretty hard. Initially I was referred to Sandler, but I didn’t sign with them for several months because I wanted to vet them and find the best one. I also wanted to understand how they worked, and why it made sense to work with one. It lets me play ball with the big guys, and helps to level that playing field. I did some deals with other masters, but Sandler is MUCH easier to work with. They have people that are accountable and respond to your calls and emails. In my experience you didn’t get that with the other masters. So I know this paragraph reads like a pitch, but really I just want to help other IT companies get set up with them. Happy to refer you to my contacts there. If you would like to get started PM me your Name, Company Name, Phone # & Email address and I will forward it directly to Sandler Partners. Following that, I’m out of it. If that makes you uncomfortable, feel free to just PM your email, and I’ll tell you more about my company and do a call with you if you want. Any questions, I’ll subscribe to this post (if I can) and drop in to answer from time to time. Thanks for reading.
TL;DR: Let me help you get set up with Sandler Partners, a Master Agent, so you can make recurring monthly revenue for selling broadband and telecom services.