The CSP, or Cloud Solution Provider program, is an initiative set up by Microsoft. The CSP Program lets you set your own prices and profit margins for reselling Office 365, Dynamics 365 and Azure, three of Microsoft’s most popular products.
The program has no restrictions regarding company size, location or level of competence. In other words, your cloud business can join from anywhere in the world and with any number of employees, even if you’re a newcomer to reselling cloud solutions.
Furthermore, here’s how Microsoft defines the CSP Program:
“The Microsoft Cloud Solution Provider program enables partners to directly manage their entire Microsoft cloud customer lifecycle. Partners in this program utilize dedicated in-product tools to directly provision, manage and support their customer subscriptions. Partners can easily package their own tools, products and services and combine them into one monthly or annual customer bill.”
In other words, the CSP is a way for partners to resell Microsoft products by working with Microsoft directly, or going through a trusted partner that is already a member of the CSP program. These two options are called Direct and Indirect CSP. I’m pretty sure you have many questions about the CSP Program and how it will help your business. We’ll tell you how it will change your business, what you have to do participate, and we’ll answer your questions in a special FAQ at the end of this blog post.
Did you know that Microsoft is changing its requirements for all Direct CSP Partners? As of August 31, to be part of the program partners will have to pay $15,000 a year in support fees. When you resell Microsoft products through SherWeb, you get our industry-leading support for free. Learn more.
How the CSP Program Will Change Your Business
First of all, you need to be prepared! If you embark on this journey without knowing what to expect, you’re just setting yourself up for trouble. We’ve seen many MSPs and VARs stall or fail simply because they weren’t properly equipped for the ride.
Do your research. Take a hard look at your business and decide what you have to do to succeed. SMB owners rarely have the time to give the proper attention to their daily tasks, which usually includes everything from accounting to customer relations to marketing and sales. Going solo on your cloud journey can be tricky. By joining a solid partner program, you can skip ahead and jump into the action right away. Forget the small details. Use your provider’s knowledge and tools to start growing and profiting right away.
What Are the Requirements of the Microsoft CSP Program?
Partners who take part in the Cloud Solution Provider program must provide the following:
- Customer support –Your support offering should meet industry standards for availability and response time.
- One invoice – Partners will be responsible for billing their customers for Microsoft Cloud Services. Customers want a single, straightforward bill for all the cloud services they consume.
Although it’s not a requirement, many partners also offer project implementation or managed services in addition to their own add-ons or IP. This is an incredible opportunity for partners to generate significant profits while building a reliable stream of ongoing revenue.
There are two main paths to become a CSP reseller:
Indirect – For partners who want to invest gradually in developing the systems, tools, and staff needed to take full advantage of the cloud. CSP Distributors, like SherWeb, can provide help with value-added services, support and billing. Read more about how the middleman could be worth it for you here.
Direct – If you already have support and billing capabilities, or are willing to invest in the necessary tools, it might make sense for you to work directly with Microsoft. If you work with a local Microsoft Partner Manager, ask for more information.
Take time to evaluate which program is best for you and your business!
FAQs about the CSP Program
What kind of investment is required?
New investments will vary based on your current practice and whether you decide to become a Direct or Indirect partner. Areas to consider:
- Support personnel and the technology needed to adequately service customers
- Ability to bill customers on a monthly and/or annual basis and provide billing and technical support in the local language
- Local tax implications of selling a subscription product versus a service
- Adjustments to your sales incentive programs to reflect monthly revenue recognition
- Management of credit risk and collections
How does this affect the way I sell today?
How you sell Microsoft Office 365, Microsoft Dynamics 365 and Microsoft Azure won’t change. This is simply one of the business models that partners can consider when selling Microsoft cloud subscriptions. If you have the resources to manage the customer lifecycle, this model may be a great fit for your business.
Are there any Partner incentives available in the CSP?
Yes. The CSP Incentives reward Cloud Distribution partners for driving the activation and enabling a resale channel and the sale of Online Services.
The CSP 1-Tier and Indirect Reseller Partner Incentives are designed to support partners in the initial stages of building Cloud Solution Provider practices.
What are my risks?
As a partner, you own the billing relationship and assume the responsibility for credit and collections with your customers. Since you directly provision, monitor and manage the subscription, customers will contact you with related provisioning, help and how-to questions as well as all issues related to technical support. You must be able to provide quality 24/7 end-user support.
What if I’m already a Direct Partner? Can I use a distributor’s service?
Yes! As a member of the CSP Program, you can choose to go Direct for some products and pick other products to be sold through a tiered system with an Indirect Provider.
This makes it easier for Direct Partners to offer a wider variety of products without deploying new infrastructure for every product line.
As Microsoft’s Advisor Program draws to a close, it’s time to rethink your business strategy. SherWeb’s CSP program is a great alternative! It can help you drive stronger customer relationships and engagement, increase your profitability and streamline your revenue and growth for years to come. And you don’t have to start from scratch. You probably have a lot of questions, so don’t be afraid to reach out, SherWeb can help you get ready for the best move your business will ever make!