June 2009 | Volume 12 / Number 6
Talking with Ben Sayers, CEO of VoIP Supply
By: Richard “Zippy” Grigonis
Benjamin P. Sayers is the founder and CEO of VoIP Supply (www.voipsupply.com), a leading VoIP solutions provider for North America, having since 2004 delivered solutions for some 60,000 customers worldwide. Its 70 employees, 2,500 products and 40,000 square feet of office space together are responsible for a nearly unlimited number of VoIP solutions that meet the VoIP needs of consumers, businesses, service providers and resellers.
RG: I find it amazing that the roots of your company are in a software development firm that worked on a stock trading platform based off of Trade Station.
BPS: After selling my company IVR, Inc., I had a three-year non-compete agreement to kill off. I founded B2 Technologies at the beginning on 2002 and spent a year working on the stock trading platform. My childhood friend and former IVR, Inc. colleague, Cory Andrews [VoIP Supply’s current Director of New Market Initiatives], helped to transform B2 Technologies from a software development company to an IT asset management firm that assisted companies looking to liquidate their IT infrastructure. We spent about a year-and-a-half brokering in the secondary market for Cisco (News - Alert) equipment, since there was a lot of stuff available following the dot com implosion. Many data centers had new or nearly new equipment that needed to find a new home, so we moved a lot of product that we picked up from auctions and liquidations. In late in 2003, Garrett Smith [VoIP Supply’s current Director of Marketing and Business Development] joined our team as a sales executive. By the end of 2003, B2 Technologies had a staff of six and $2.3 million in sales. During the first six months of 2004 customers began asking more and more for VoIP solutions, so in August 2004 we launched VoIPSupply (News - Alert).com. At the start of 2007, we renamed B2 Technologies to VoIP Supply, LLC. We finished 2007 with $24 million in sales.
RG: How do you categorize VoIP Supply?
BPS: I’d say you could call us a Value-Added Reseller (VAD). We’re also an online retailer with the differentiator that we’re got an in-house call center of training sales reps. Some of our competitors are significantly smaller than we are, and act a bit differently in that they ‘lead with price’ and may not necessarily want to talk with customers. We, on the other hand, don’t lead with price and would rather that you call in to us, talk things over, and end up with a product that’s right for you. Our web-based model is a great way to cast a wide net and pull in droves of customers. Over the years we’ve been at the forefront in terms of offering everything you need for VoIP, and we’ve acquired customers that range from VoIP service providers all the way down to folks who just use IP in their home with their own BYOD (Bring Your Own Device) VoIP provider.
It’s interesting in that we service many different kinds of verticals, we have the online retail piece as well as the offline call center that offers sales and technical support staff. So it’s really a newer model. Not too many companies out there are very similar to us, which is probably one reason that we’ve been very successful over the years – we not only offer everything you need but we also have the expertise to put everything together. If you go to a ‘big box’ company, they may sell VoIP stuff, but if you call and talk to a customer service rep, they don’t really know what’s going on. Moreover, even some of the ‘VoIP-specific’ online retailers often don’t have the staff to support many consultative sales. Between those two types of companies, there are ‘pure distributors’ or ‘value-added dealers’ which focus on reseller recruitment and building the channel for manufacturers. We play in many different ‘pools’. So in describing us, ‘VAD’ is the best fit, but the emphasis for us has always been, ‘Here’s what we offer: the ability for you to come to VoIP Supply and get everything that you need, and you can talk to somebody who knows VoIP inside and out. Our specific business model probably doesn’t have a name yet, but what I described is what we do.
RG: So VoIP Supply has quite a range, servicing everybody from consumers to business.
BPS: We don’t send too many people away. In terms of geographical coverage, we have a global customer base, though we do emphasize our efforts in North America, mostly from a fraud control standpoint. It’s difficult to protect yourself in Europe, eastern Europe in particular, as well as Africa and even some countries in South America. We do about 8 percent of our business in Canada, 91 percent in the U.S. and about 1 percent elsewhere in the world. There’s certainly a huge market in Europe and there’s no significant competitor over there, but if you’re not entrenched over there and have a good measure of self-protection and fraud prevention, it’s not a place where I’d venture into lightly. Maintaining an international presence requires having staff in those far-flung locations. We found that if you’re German and you live in Germany, you want to speak with somebody who understands the locale and the ins and outs, and not necessarily somebody who may be based in the U.K. or Austria or wherever. So, one encounters many peculiarities when doing business overseas. It requires more of a ‘push’ than we are willing to make right now.
RG: So you tend to offer many professional services? How much of your business involves customization as opposed to straight resale?
BPS: Most of it is straight resale, but we do offer paid support, service programs and pre-configuration and provisioning. But for the most part it’s all part of the presale experience for the customers. We make sure that we examine what their needs are and get them the proper equipment, and we can help them with configuration issues if they need that. We don’t roll trucks in every state of the U.S., but if they really need that much ‘hand-holding’, then we’ll certainly work with them to provide a local provider that can come in and help them do more complicated things onsite. But the way IP PBXs are these days, we can pretty much configure all of whatever you need in terms of extensions, IVR menus, and voice prompts in our lab and then ship it out in a state where as long as the customer can get the IP PBX (News - Alert) up on their network when they receive it, everything should be fine. Later, we can call it up remotely if need be to modify a configuration. But the core of our business is hardware retail with some service, but even there we give away much of that as part of the sales process.
RG: Is there any limitation on the size of your customers?
BPS: We can handle large or small customers. We’re highly reactive to our customers’ needs. We serve large enterprises, government and institutional customers that might have a 500 or 5,000 seat deployment. And yet we have thousands of Small-and-Medium Businesses (SMBs) that between 8 and 25 seats. Our core does tend to be SMBs implementing a new system, replacing an old one, or expanding by opening up a new location.
RG: I see you also deal in open source telephony platforms. Is it difficult to make money with open source?
BPS: When we first got into VoIP, the only platforms that were totally accessible to companies such as VoIP Supply were the open source Asterisk (News - Alert)-based systems, the PCI I/O card business and things that serviced a limited number of endpoints. There was SIPura, now a part of Cisco and, the Grandstream BudgeTone series and droves of folks who were converting Cisco 7940s and 7960s from the Skinny client protocol over to SIP. So our first customers were really very early adopters, many of whom were building their own IP PBXs. Many companies, whether an SMB or a large enterprise or even those big on open source, helped us achieve early presence and visibility. People gravitate to us because we offer that ‘small shop’ feel, where you get an intimate customer experience, but we also can achieve the kind of economies of scale to help a service provider who perhaps needs 5,000 or 6,000 devices. We have the back-end logistics to go out there and pre-configure all of the devices, ship them out to the provider’s customers, do the RMAs, do the customer service, and then, on the next call, get in there with a 5-person shop that just needs a hosted VoIP solution. We may sell them the phones and partner with a hosted provider that leverages one of our service provider-type services on the hardware side of things to ultimately deliver the service. So it’s really something of a mix-and-match situation. In general, we try to attract SMBs, but just by being a great business that’s easy to work with, we attract all comers.
RG: How has the downturn in the economy affected VoIP Supply?
BPS: We’ve felt the same pressure as has any retailer in the middle to the end of 2008. But we’ve certainly seen a positive increase in business and activity since then. The first quarter of 2009 was strong and profitable for us, so many customers are coming back, government money is certainly being freed up under the Obama Administration. We’re not exactly where we were back in June of 2008 or prior to that, but we’re optimistic and we’re currently doing extremely well, all things considered. IT
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