Technology Live 2023 returns to the Business Design Centre, London on September 12. The one-day event brings together vendors and resellers/MSPs from across the ICT space to make connections, build relationships and find out about new technologies.
Attracting suppliers from the IT, cybersecurity, AV, print and telecoms sectors, Technology Live has a strong focus on diversification and the opportunities that exist for resellers to expand into new product areas.
As part of Technology Reseller’s build-up to the event, we will be running a series of articles on Technology Live itself and on the themes of convergence and diversification generally.
This month’s interview with Colin Blumenthal, Managing Director of Sharp IT Services, previously known as Complete I.T., falls into the second category.
The company has been providing IT support to SMEs for 30 years, the last three and half under the ownership of Sharp, which acquired Complete I.T. in 2019 with the intention of adding IT services, including security and telephony, to its offering for direct customers and eventually to its reseller channel as well.
Sharp’s expansion into IT services was a logical move that has enabled it to give customers a complete product and service offering, including managed print, AV, IT services and telephony – a model it is now seeking to replicate across Europe.
Today, Colin Blumenthal is not just MD of Sharp IT Services in the UK but also Sharp’s Vice President of IT Services in Europe.
In this Q&A he outlines some of the opportunities and challenges that diversification has brought and explains why entering new technology areas requires careful management.
Technology Reseller (TR): How was 2022 for you and what are you looking forward to in 2023?
Colin Blumenthal (CB): Complete I.T. has been in business 30 years – three and a half of those as part of Sharp. So, at Sharp IT Services, as we were renamed in November, there’s not much we haven’t seen.
Looking back over last year, it’s clear that the momentum to cloud services
and more processes being done in the cloud, whether that’s public or private, is increasing. The pandemic kick-started that with remote working and Microsoft Office 365, and Teams and Zoom specifically, and we saw the migration to public cloud services continue in 2022. Businesses now have confidence in using public cloud, bar a few pockets like national security-type businesses. Our focus is SME businesses, which is why we were a good fit for Sharp to buy.
Internally, the integration with Sharp in the UK has continued, with more and more shared services between the teams. IT, marketing, HR and finance are all now shared services and we also share some offices. Sharp has moved into our Bristol office; we’re establishing ourselves in Yorkshire, operating out of Sharp’s Wakefield office. We are now also in their Birmingham office, in West Bromwich, from their Midshire acquisition. And we’ve got help desks in Manchester as well. We probably share half of our 7 locations with Sharp.
This integration, and the change of name, gives us a launchpad to really accelerate the cross-sell of our brand of IT services to Sharp’s SME direct client base. That’s what we’re looking to achieve in 2023.
TR: Are you planning to extend those services to Sharp’s reseller base as well?
CB: The pledge I made at May’s Future Workplace event was that we would arrange roundtables to discuss with print dealers the opportunity of introducing IT services to their clients, and we are still in that phase.
We have had some meetings with Sharp dealers. A lot of them are doing something in IT already, but the main feedback we get is concern about losing control of their client. They worry that with this big corporate coming in the client will start to use Sharp for everything rather than the reseller.
That opens up the question of whether we could white-label our IT services through Sharp dealers. It is certainly something we will consider, but my own view is that SME businesses really want to know who they’re dealing with when it comes to IT and would prefer to have a direct relationship with their IT partner rather than buying through somebody else. That’s my opinion and I could be wrong. As I say, we’re still in the research phase.
That said, selling IT services through Sharp resellers is definitely something we want to do, if we can make it work for everybody. I think we need to decide what we are going to do by the end of this financial year, by the end of March.
TR: What are the challenges that Sharp IT Services will have if you do decide to add IT services to your reseller offering?
CB: If it’s successful and we expand our client base by selling through Sharp dealers, then it is just the standard challenge of taking on more people. Right now it is difficult to find the right technical people who are both people- and service- focused. IT has a reputation for not necessarily having people-focused people.
As an MSP, we should be able to create a more exciting employee value proposition and career for an IT professional than an internal position in a non-IT company. We are better placed to attract people, in terms of training, access to expertise, colleagues etc.. And being part of a bigger company has benefits. We’ve seen some good career opportunities for our team outside Sharp IT Services, within the wider Sharp organisation in the UK and sometimes in Europe as well.
Recruitment is still a big challenge and it’s a very competitive market. We have seen dramatic salary increases coming out of the pandemic, which has been painful.
TR: Has Complete I.T./Sharp IT Services grown since you were acquired by Sharp in 2019?
CB: When we were acquired, I think we had 175 people and we’re at 210 people now. We’ve sold our services to about 150 of Sharp’s 7,000 SME clients, despite the pandemic. This represent around 10% of our revenues, but it shows the potential.
I make a bold statement that if we get the cross-sell right we will be the largest provider of IT services to SMEs in the UK and across Europe, if we manage to replicate the model successfully there.
TR: So, 90% of your revenue still comes from your relationships rather than Sharp’s customer base in print, AV and other areas?
CB: That is correct, and it just shows the potential we have. That cross-sell opportunity is something to be very, very excited about and something that Sharp in the UK is now investing in. For example, we’re creating a new Pareto graduate scheme for business developers who can sell and position what we call the wheel of services.
I think we’re unique in the UK in our ability to sell almost everything a prospect or an existing client needs for the workplace and the future workplace – traditional print, managed print, IT services, platform, telephony, business applications, document management, GDPR, signage – everything.
Security obviously is an important part of those services as well, and on the print side Sharp has some fairly unique print security offerings that combine nicely with our security offering. The wheel of services is quite a compelling proposition.
TR: I’m surprised you’ve only sold to 150 of Sharp’s customers so far, because as you say that wheel of services is compelling.
CB: Don’t forget we had the pandemic bang in the middle of those three and a half years. I think also there’s the realisation that it’s a big job to transform Sharp and its team from being a print business to being a technology business.
There are two things there: a) the marketing angle, changing the perception of the business; and b) transforming the account managers who have the relationships with those 7,000 SMEs from being able to sell a product to being able to sell, or position, a service. That’s a big transformation. And we’ve got to do that throughout Europe.
There’s a very big divide between selling, knowing about and being experts in print and suddenly being able to talk about IT and services rather than a product with an 18 pages per minute print speed and 2p per copy or whatever it might be.
TR: Will account managers also have to develop relationships with different people within their customers’ businesses?
CB: They will, absolutely. But that’s also very important for protecting print revenue because we’re finding that the people who own the print relationship now are increasingly IT people and not office managers or facilities managers. It’s often the tech department, the IT department that’s responsible for printing. So, by owning the IT relationship, because that’s ultimately what we at Sharp want to do, we will protect our print revenues as well.
TR: Do those 150 Sharp customers you have done business with have any needs or characteristics in common?
CB: Not on the IT services side, but one thing we have noticed is that a large proportion of those 150 clients have bought our telephony service. One of the reasons why we’ve been more successful there, I think, is that it’s more of a product than a service. We’ve found that account managers are more comfortable talking about a cloud telephone system than an esoteric IT service.
Within IT services, clients have a whole mix of needs and requirements. What we want to do as an IT partner is to help them make the right decisions when it comes to IT. Our service is called the Complete IT Manager and three quarters of our support agreements are with clients that don’t have any internal IT resource and typically have 50 or fewer IT users, where we effectively act as their IT manager.
TR: For someone who likes simplicity, the wheel of services concept is appealing, but are some clients resistant to the notion of a one-stop-shop?
CB: What we’re hearing is that companies want efficiency and having to manage fewer relationships helps in that regard. We’re nowhere near having one account manager, one invoice, one helpdesk, one service centre, but that’s the ultimate aim.
TR: Are there lessons you’ve learned in the last three years that are now influencing your European expansion?
CB: Yes. It is all about winning the hearts and minds of the MFP account managers to get them to open up their clients to the IT service side of the business. We always knew they held the keys to the kingdom, and it isn’t very easy to go around them. Not that we want to. We want them to be involved, but it takes a lot of time and effort to work well with the account management team and involve them.
I think the other thing is to make it clear that IT services is not an initiative that’s going to go away. All sales teams will have faced new initiatives before and know that if they keep their heads down, it’ll go away and there’ll be something else along in six months’ time that they can sell. But IT services is here to stay. Sharp, being a technology business, not just a print business, is here to stay and they need to get on the train.
TR: Are you talking to your customers about print?
CB: Yes, we are cross-selling print services and visual solutions to our existing IT support clients, though the cross-sell the other way is the real focus. For an IT person, print isn’t the exciting bit, so we continually have to remind them that print is still important and needs to be positioned when talking to clients.
TR: The thing you often hear from the print side is that because they regularly go onto their customers’ premises, they have a closer connection with them than perhaps some of the IT providers do.
CB: I would say it’s almost the other way around actually. On the relationship side, I think an SME business wants to see their IT company more and have a closer, much deeper relationship than they do with their print provider.
TR: What advice would you give technology resellers in 2023?
CB: As we enter a potentially difficult economic climate, it is important to focus on upselling the value that you deliver as an IT partner for the client. A lot of IT businesses fail to do that. The client thinks ‘everything’s working, so what are they doing?’. Everything’s working because the MSP is doing thousands of things behind the scenes that the client’s unaware of.
My advice is to back-sell the value you offer and never sell the technology, always sell the business benefit of the technology. The commercial part is going to continue to be important – even more so in an economically difficult time.
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