telecom procurement services

There are two ways that telecom services are sold: through sales reps employed by the carriers (the direct channel) and by telecom agents (the indirect channel). The people that make up the two segments possess different skill sets and experience levels. Most agents launched their careers in the direct channel. Most direct reps haven’t experienced the indirect channel. Direct reps are more sales oriented. Telecom agents need to take a more consultative approach.

The following are a number of items to consider when purchasing carrier services:

Telecom agents and telco sales reps can be influenced by commissions and spiffs. Phone and cable companies push certain products and services because they’re the most profitable or the providers are using them to phase out older offerings. The providers will offer higher commissions and one-time payouts to incent their sales reps and agent channel. When this occurs, “what’s best for the customer” can become less popular with agent and sales managers. If you are being pushed in a direction for no particular reason, it might be because the agent or sales rep you’re working with is putting his or her interests in front of your own.

Telecom agents and telco sales reps have access to the same pricing. Most agents don’t charge a fee and agents don’t add to the cost of a carrier’s services. There are costs associated operating a direct sales and agent channel. You could make the argument that the costs associated with operating a direct channel are much higher. Telco companies maintain a direct channel because they want a salesforce devoted to selling their services. They need an agent channel to push their direct reps and because certain sales will only complete with an agent’s involvement. A few examples: the individual consulting the company demands compensation or a company’s phone vendor is selling the telco service.

Certain telcos won’t allow agents to sell their services. Older, more established companies restrict agent access. Newer carriers and ones fighting to retain or claim market share are pro agent. Some providers, who operate agent channels, limit the services the agents can sell. AT&T, Verizon and Cox limit agents or avoid them altogether. AT&T allows agents to resell their network, but under the brand name ACC Business. ACC Business offers different pricing and terms and is not hugely popular. Verizon permits agents to resell their landline services but only recently allowed them to resell their 4G wireless service. Cox offers a small one-time payout (too small to be taken seriously by agents) for referred business. The reason Verizon, AT&T and Cox limit telecom agents is because they want to protect their pricing and control the behavior of the sales reps selling their services. Agents tend to drive down the cost of services and steer clear of problematic services, no matter what the commission level. That’s the case because agents work for their clients and earn their commissions over time.

Most agents start their careers with and receive their training from phone and cable companies. They become independent for a number of reasons: to maximize their income; they’re laid off or accept a buyout; they wish to sell multiple product lines; they prefer working for themselves… Agents tend to be more experienced and knowledgeable than telco direct reps. Telco reps receive more support from sales engineers and managers.

Voice over IP has lowered the barrier of entrance to the industry and more and more carriers are fighting over market share. Profit margins have diminished. Few carriers have the resources to maintain an experienced, well-trained sales force. The most experienced, best-paid salespeople faced ever-increasing quotas and were either forced out or resigned. Businesses can take advantage of this resource by procuring their business phone and internet services and equipment through telecom agencies, like CarrierBid.

If your business would like to receive the support and expertise of a full service telecom agency, please contact CarrierBid today or complete the web form on the right side of this page.

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