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MARGINS RANKLE DYNAMICS VARS
Reports from the partner Q&A at Microsoft Convergence had VP Doug Kennedy acknowledging that there is a great deal of unhappiness in the channel. But whatever steps are taken in that direction, Microsoft seem unlikely to address the major complaint, plummeting margins under the new partner agreement. During the course of the conference, several resellers said their margins had gone from 50 percent to 20 percent. “Microsoft drove me away,” said one who was attending the Acumatica reception.
Helping the smaller VAR is supposed to be one of the goals of the Master VAR program, but it’s hard to see how Sales Affiliates are going to make up that much ground on lost margins, even given the Master VAR's purchasing ability, unless they can drive significant increases in sales coupled with some cost savings based on the Master VAR’s scale in offloading services. And a conversation with Rich Wickham, GM of partner sales, indicated that Microsoft views the solution to most complaints as selling more of the stack. The margin issue is why some competitors, including Acumatica, were feasting on the Dynamics reseller base during the conference. As usual, Craig West of NetSuite and his team were in town recruiting Dynamics dealers. Interestingly, Taylor Macdonald, who leads recruitment for Intacct, said in an email his company was not present and he viewed the Acumatica and NetSuite efforts at a competitor's show as ambush moves that he disapproves of. Incidentally, resellers also reported that Kennedy was asked if Microsoft has any reaction to its channel picking up new products. He was quoted as saying there's nothing new; that has been going on for a long time. Well, not like this it hasn't. Once, membership in the Interdyn Group required loyalty to Microsoft. But veteran members Artis and Cargas picked up Intacct and it admitted three newer members, L. Kianoff Associates and Socius, who also carry Sage, and LBMC Technologies which opted for Intacct, as did Kianoff,. Socius' marketing Syspro is relatively recent.
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