Bringing the subscription economy to life

June 4, 2019

Sean Callanan of Close Brothers Technology Services reflects on how much we depend on subscription services in our everyday life and how B2B companies are reacting

I wake up most mornings before heading into the office, I follow my usual routine of getting ready for work and before I even jump in my car, I’ve already used a product supplied to me through a subscription-based solution (Harry’s Shave Club). I then get the train and head to the office while listening to music on Spotify.

If we sit back and look at how we access and purchase most of our products and services as UK consumers, it’s fair to say most of us have at least one, if not multiple subscription-based products and services that we use regularly.

We live in a subscription economy and see this everywhere from Spotify, Netflix, NOWTV, ClassPass, Abel & Cole, Gousto, Zip Car and HP Instant Ink, to name a few. As consumers, we expect a subscription experience to be one of our purchase options.

In order to stay current, many B2B technology resellers, system integrators and distributors are also seeing the customer benefits of offering a subscription model and are applying this thinking to their product and service offerings.

This is often managed through a variation of services agreements, which will detail how and what the customer is paying for over the service period required. This is becoming more the norm in a technology environment where “as a service” is essential. We see this from many of the technology manufacturers but they’re often only available for some of their specific product offerings and is rarely available across multiple technology platforms or available for competitive equipment and services.

Mobile technology providers are no exception and if you look at some of the more niche resellers and service providers like Symec, it’s shifted very quickly from product-centric to relationship- centric business models (subscription) which meet customer expectations across many levels, from technology supply and deployment, to in-life service management and on to end-of-life data security and environmental disposal.

Over the past decade, technology has completely transformed the way companies do business. A huge percentage of companies have moved from paper to digital processes – devices like tablets and handhelds are essential because they allow the flexibility to conduct business from any location, anytime on any device.

Today, this need for mobile technology hasn’t changed, but the pace of technological change is happening faster and faster, making it increasingly difficult for companies to keep up.

A subscription model allows companies who use any form of technology to stay current without any upfront expenditure to acquire the technology and services they require.

The old way of doing business may have looked like this:

  • Company X has £500k Capex for fixed assets
  • Company X sends out RFP to ten providers
  • Company X demos/tests ten different models
  • Company X buys 500 devices/tablets from a single supplier
  • Sweats assets for 5+ years

The pitfalls of this approach: 

  • Devices are frequently broken and lost
  • Security or operating systems aren’t necessarily up to date or the latest versions
  • Older devices aren’t as efficient, with less power availability or slower to process data
  • Hassle, cost and data security risk of disposing of existing technology when you need a refresh

The new way of doing business:

  • Technology becomes an ongoing operational expense, rather than a capital expenditure
  • IT and operations come together to select the right subscription platform
  • Rent most current device or tablet for an agreed fee in-line with the subscription agreement; for example, this can be as little as £5 per user per month
  • At the end of the rental, devices are returned and swapped out for brand new devices with the most up-to-date operating systems and functionality

Benefits of the new way of doing business: 

  • Always the latest technology and operating system
  • Automatic security updates It is cheaper to rent than to buy
  • Shorter, swifter upgrade cycles to stay current
  • This model ensures the end user is using the best technology, which ticks a box for IT This model ensures the end user has the best management and uptime, which ticks a box for operations

Close Brothers Technology Services
If you want to know more about the benefits of a subscription- based technology solution, or would like to discuss how Close Brothers Technology Services and its partners can help you, please contact Sean Callanan on: 07711 193834
Sean.callanan@closebrothers.com
www.closebrotherstechnology.co.uk

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