Should an ISV Sell Hardware?

As an ISV, you may not be a hardware expert, but you know your customers need the right hardware to get the full value from your applications. Is the logical conclusion that ISVs should sell hardware along with their software solutions?

DevPro Journal asked Linda Sudderth, North America Sales Manager for Epson America’s Business Systems Division, to share her perspective on this issue and to provide advice on how to increase the value of your applications by providing customers with a total solution.

DevPro: Should an ISV sell hardware? What do ISVs need to know?

Sudderth: ISVs can successfully sell hardware if they have the infrastructure and financial strength to support it. To sell hardware, you need to have added capabilities as well, such as presale and post-sale support, including staff technicians and help desk.

Depending on your software, the requirements to support hardware will vary. If your software is designed to be self-installed, like some mobile/tablet point of sale solutions, for example, the need for personnel to provide on-site installation and set-up would not be necessary.  Some more sophisticated applications require on-site installation and training, therefore, require a more robust infrastructure.

If you don’t have a plan to support the hardware that you’ve sold, it could lead to a negative experience for the end user — and reflect poorly on your business.

DevPro:  What are alternatives to selling hardware that enable an ISV to have its software included as a part of a total solution?

Sudderth: ISVs have three main options:

1. They can sell through a value-added reseller (VAR) network. ISVs build a partner channel that provides solutions that include their software, and the partners provide the certified hardware, installation, pre- and post-sale software and hardware technical support and service.
2. Partner with a company that provides hardware fulfillment for a volume of ISVs. Some ISVs certify a hardware stack and rely on a hardware fulfillment partner to sell, service, and support the certified hardware stack. Hardware fulfillment partners provide a bevy of different services and differ from company to company; some create microsites for their ISV partners where end users can order the full solution. Some hardware fulfillment partners will receive a call transfer from the ISV, take the order and ship the product providing depot hardware service programs, where others will provide more in-depth service, as well as help desk. Some high-volume ISVs utilize this hardware fulfillment model and it works well for them.
3. Identify a partner or two who have national reach and partner strategically with clearly defined roles for selling, supporting and servicing the accounts — creating a strong mutually beneficial strategic partnership.

DevPro:  What are the keys to forming strong strategic partnerships with hardware vendors?

Sudderth: It starts with the ISV’s vision for how they plan to go to market and then finding the right hardware partner that can support the strategy. Keys to good partnerships include:

• Clearly defined requirements for both partners and a clear understanding of the other partner’s expectations. Alignment creates a much higher probability of a successful partnership.
• Certification and full testing. You must ensure your software is fully compatible with the hardware that will provide the best user experience.
• Presale and post-sale support. There are a lot of questions to answer: What’s required by the software for installation? Is the software designed to be self-installed?  Do you want to offer on-site service and support? Are site surveys required prior to installation? Is Depot service the way to go?  Is on-site training required for quick learning and the best way forward to ensure success?
• Marketing and Selling. Answer questions including: What type of marketing will be required for the solution? Web marketing?  Print advertising? Who funds marketing?  Who sells the solution? Does the ISV sell the software and the hardware partner sells the hardware?  Is it sold together?  Do you want to have defined territories for selling?  Will there be conflicts if territories are employed?  How do you resolve those conflicts?  Where will the corporate location be?
• Mutual benefit. Both partners need to clearly understand what’s in it for them.

DevPro:  What benefits can an ISV expect from a solid ISV-hardware vendor partnership?

Sudderth: A solid partnership can be a great vehicle for selling total solutions. When your software is sold with hardware, you have more control over the user experience. Some ISVs say, “Here’s the hardware our solution is certified for. Go buy it wherever you want,” versus other ISVs that provide total solutions—and more value to the customer. It’s also harder to be unseated—you have a stickier relationship with end users.

Other benefits include:

• Tradeshow participation and collaboration. You may have access to MDF for booth sponsorship or you may be invited to participate in an industry tradeshow with your hardware partners.
• Sample products for development, certification, and testing
• Marketing collaboration, including case studies and press releases that give you a greater media presence
• “Feet on the street” support if on-site service is needed
• Presale and post-sale support

DevPro:  What are the three most important questions to ask when forming a partnership with a hardware vendor?

Sudderth: Before you ask questions, have a clear vision of how you want to go to market, then ask:

1. What is your strategy for aligning with ISVs? Do you align with many ISVs or just a few? Do you provide hardware fulfillment center or are you a full-service provider?
2. What is the hardware partner’s expectations for the partnership?
3. What is the hardware vendor’s service and support strategy? Does it include depot repair, phone support, help desk, or on-site service?

Find the Answer

The answer to the question, “Should an ISV sell hardware?” is going to be unique to your application, your capabilities and the partnerships you build. Sudderth emphasizes the importance of developing a solid go-to-market strategy tailored to your unique application before talking with potential hardware partners. She also suggests seeking advice from others in the industry on models that work best.

The time you invest up-front before asking for a meeting with a hardware vendor will help you avoid missteps and will result in greater success with a hardware-software solution launch.  

Linda Sudderth is North America Sales Manager for Epson America’s Business Systems Division and has been with the company for 21 years.  She currently has responsibility for the strategy and direction of the OEM, VAR & ISV Channels focused on retail, hospitality and financial markets in North America. Linda has over 25 years of experience in the retail & hospitality industries from a manufacturing and solution sales perspective and has a volume of experience negotiating global contracts. Prior to Epson, she was with Siemens Nixdorf in the manufactured POS Terminals division and at CompuAdd, a PC and POS Terminal manufacturer, as a Sales & Marketing Manager for the POS Division. Linda has a Bachelor of Science Degree in Computer Science from Sam Houston State University.