The Business Risk of an Unattached Asset
Last week I had lunch with my dear friend Tim Adams to discuss the importance of service, a topic that is top of mind for all of us in the technology field.
Why should businesses buy service contracts? As technology sales professionals, how should we position the value of this intangible asset?
Tim works as a technical architect for Integrated Archive Systems (IAS), a solution provider specializing in the delivery of complete, best-of-breed IT infrastructure solutions. He provided some great insight as to why his customers find maintenance service contracts essential when purchasing new hardware, software and systems. We also discussed the business risks IF maintenance IS NOT a part of the initial sale.
Tim’s top 5 reasons why companies should invest in service contracts:
- It’s often impractical to maintain spare equipment to do self-support;
- Lack of internal resources for self-support, especially in remote sites;
- Provides leverage with the manufacturer should something go wrong;
- Extra help to triage problems at the intersection of hardware and software and with interoperability between disparate components;
- And, in many cases the cost of a support contract is far less than the cost of a replacement asset.
The business risks far outweigh the initial cost of the service and could potentially cost you a lot more in the long run. Equipment failure could result in downtime critical to your company’s business — or worse, downtime for your customers, which negatively impacts their business. With no service contracts attached to valuable IT assets, businesses can also incur exorbitant technical support fees, extra hardware costs and additional internal resource hours, while also facing the potential for a dramatic loss in revenue. It all amounts to a serious headache that you would never want to deal with.
The fact is the risk far outweighs the cost. In the end, the added cost of support is worth it. No asset should go uncovered. In Part 2 of Should I buy a service contract or not…,you will hear from members of the LinkedIn Selling Services Group as they chime in on their experience with the importance of attaching services to all products sold or purchased.