Sage VARs Scramble To Capture Former MIS Group Customers

When MIS Group, one of Sage North America's largest VARs, suddenly shut down in July, it sent a tremor through the vendor's channel ecosystem and left hundreds of MIS Group customers -- including some that had paid MIS Group for undelivered software and services -- without an IT solution provider.

In the three months since MIS Group's collapse, however, other Sage channel partners have stepped into the breach, taking on some of the failed VAR's customers, which number somewhere between 2,000 and 3,000. Some have even provided services at reduced or no cost in an effort to help former MIS Group clients make up their losses.

"There were some challenging opportunities and, honestly, some clients that were upset," said Stephen Blythe, CEO of Sage channel partner Blytheco LLC, which has picked up about 75 of MIS Group's former customers.

Several of the solution providers working with former MIS Group clients are VARs that MIS Group acquired and have sought to reconstitute themselves in the wake of the company's failure. Other VARs have recruited former MIS Group employees as they try to sign up the company's former customers.

Dallas-based MIS Group, Sage North America's largest reseller for two years running, suddenly closed its doors July 6 citing the economy, tight credit and "market circumstances beyond our control," according to a notice left on the company's Web site.

While details of what happened at MIS Group have remained unclear, interviews with Sage executives and other Sage solution providers paint a picture of a company that had spent heavily to acquire other solution providers in an effort to grow and closed suddenly when it was unable to acquire financing to cover the cost of its operations.

Sage immediately began offering free phone support to MIS Group customers that were not under any kind of Sage support plan and were reliant on MIS Group for service. But some were in the middle of software implementation or upgrade projects, several resellers said, while others lost money they had paid for software and services.

Some Sage competitors, including Microsoft and NetSuite, used the failure of MIS Group as a chance to try to recruit Sage's reseller partners, saying the sudden closing of the Dallas VAR raised questions about the stability of Sage's channel.

Sage has sent former MIS Group customers lists of the company's channel partners within their geographic regions, according to solution providers, but they say the vendor has been careful not to play favorites by recommending specific resellers.

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