Sage Partners Seek Technology Road Map, Channel Reassurance At Next Week's Summit

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The rebranding effort, announced at last year's Sage Summit and implemented three months ago, created new product names -- Sage 50, 100, 300 and 500 -- for such longtime Sage products as the MAS ERP 90, 200 and 500 application sets and the Accpac and Peachtree accounting applications.

"They're diluting the North American brands," said one angry partner who resells some of the renamed products. The reseller also said he had to devote a lot of time and money to making changes to websites, marketing materials and more. "It's very expensive and a complete waste of resources."

The partner also said resellers were not reimbursed for the expenses. But, another reseller said partners could use Sage-provided market development funds for the changes. Sage executives said the company offered co-funding up to 100 percent for eligible brand-transformation activities, as well as such assistance as an electronic brand transformation tool kit.

"It makes things a bit challenging with our customer base," said Manny Buigas, principal at Axis Global Partners, a Miami-based solution provider, of the rebranding. He recently got a call from a prospect who thought Sage was no longer supporting Peachtree (now Sage 50), for example.

Another partner who described himself as "neutral" on the re-branding added: "I don't think it's going to generate the new business that they think it's going to."

Other partners, however, either say the rebranding hasn't been a big deal or have dealt with it and put the issue behind them. Some even back the plan.

Wolf at Azamba Consulting, for example, said the rebranding effort "represents a commitment that I can get behind" because it makes Sage more competitive and "self-deterministic." But, he's also quick to say he understands why other partners are upset: "People have a hard time with change."

More partners today seem up in arms about the new software subscription plan. Sage announced the subscription pricing option for its ERP and CRM applications in March, as well as price changes for traditional perpetual licenses and changes in customer support and maintenance plans.

One partner said the margins on the subscription pricing are less than half those Sage's top partners can earn on traditional licenses. "There's absolutely no motivation for me to sell it," he said. The partner also noted that Sage increased prices for perpetual licenses on some products in April and dropped the lowest level maintenance/support option -- effectively raising that price as well. "The whole purpose was to make the subscription pricing look more palatable," he said.

"We have yet to sell one subscription because there isn't enough margin in it for us," said another partner, who calculated that his company would earn only one-third the margin it gets for perpetual licenses.

"We really don't break even or get ahead of the deal for five or six years," said another.

The subscription pricing is targeted at smaller companies that want to use Sage software but can't afford the up-front cost of a perpetual license, Sage's Langner said. "It's really a new means of financing for our customers," he said, adding that it gives partners an opportunity to sell to new customers and re-engage with customers who have let their maintenance plans lapse. "Some of our largest partners have been selling on subscription."

About 20 percent of Sage's new license sales today are subscription, according to Langner.

NEXT: Longtime Partners Sign On With Sage Competitors

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