IT and Business Insights for SMB Solution Providers

The Cloud Solution Recipe for Cyberspace Success

Want to make money in the cloud? Think solutions, not products. By Rich Freeman
Reader ROI: 
CREATING CLOUD SOLUTIONS is far more profitable than reselling cloud products.
SAAS MIGRATIONS, server workload “lift and shift” projects, and business process optimization are three examples.
SUCCESS requires salespeople who understand business needs and technologists who can translate those needs into deliverables.
CULTIVATING SUCH PEOPLE from within is often more cost-effective than hiring outside experts.
PARTNERING WITH OTHER CHANNEL PROS is also an option, provided you define clear guidelines in writing.

CHRIS PLOESSEL is a big-time Amazon Web Services partner who generates a lot of revenue reselling that vendor’s applications and infrastructure.

Profit? Not so much.

“It’s almost more of a burden than it is a benefit,” says Ploessel of selling AWS licensing. “We make very low margin on it.”

That hasn’t stopped RedNight Consulting, the Aliso Viejo, Calif.-based cloud service provider he heads, from making plenty of money, though. To the contrary, the company has been growing steadily since its founding in 2015 and routinely clears 30% to 40% margins on its offerings. The key is that those offerings are cloud solutions built on top of AWS products rather than cloud products alone.

Indeed, as many channel pros know all too well, simply selling Office 365 licenses and maybe a little Microsoft Azure capacity is a dead-end street financially. Blending several such products and adding services to the mix, by contrast, is a recipe for durable cloud success. And you don’t have to reinvent your business overnight to get started.

Cookie-Cutter Profits

Almost any kind of software product an SMB might require is available in the cloud these days. A cloud solution combines one of them with complementary systems and proprietary expertise. The simplest examples bundle an anchor product, like Microsoft’s Windows Virtual Desktop (WVD) offering, with Azure Active Directory services, security, backup, and ongoing remote management. Ploessel, who sells Amazon Workspaces to clients rather than WVD, has found a virtual desktop deal to be a good source of follow-on projects too. “Everything else just rides on its coattails,” he says.

Chris Ploessel

Providing SaaS migration services is another easy starter solution. Every first-time Office 365 adopter needs help configuring applications, moving data into the solution, and getting user accounts established. Vendors like BitTitan and SkyKick make affordable tools that automate much of that effort, so the work is generally very simple. At $100 a seat or so, it’s also very profitable, and you can supplement it with end-user training.

Migrating on-site server workloads onto infrastructure-as-a-service platforms can be even more lucrative. So-called “lift and shift” projects require a great deal of assistance with tasks like needs analysis, asset inventorying, cost planning, and security. “Every customer we talk to is interested in getting out of their on-premises stuff,” Ploessel says. “The migrations themselves, if you have the right toolsets, are pretty simple.”

About the Author

Rich Freeman's picture

Rich Freeman is ChannelPro's Executive Editor

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