Agent vs. White Label: The Best Way To Sell Cloud Communications

You’ve built a successful business as an Interconnect or Managed Service Provider, and now you’re thinking of expanding your offering by offering your customers Hosted PBX, Hosted VoIP, and SIP trunking solutions. They’re asking for it, and you’re well-positioned to deliver.

But now you have a decision to make. Assuming you’re not going to buy a switch and build your own solution from scratch, which can cost millions of dollars, you need to figure out whose solution you want to resell and how you want to position your company. Should you be an agent of a carrier, or should you choose a white label solution that puts your brand front and center with your customers?

A recent blog post at Channel Partners lamented the use of the word “subagent” to describe channel partners who resell a carrier’s services. As pointed out in the post, “subagent” connotes “subordinate” which means inferior. The author is asking carriers and others to use a different word, one that is less “demeaning.” And it’s a fair point. But at the same time, perception is reality, and being a subagent, or an agent, or a reseller is always going to be seen as a position of weakness because end customers often perceive agents and resellers as middlemen.

“At CoreDial, we strongly believe that it’s much more powerful for both Interconnects and MSPs to choose a white label solution that allows them to strengthen their brand identity,” said CoreDial CEO Alan Rihm. “A white label solution allows them to truly own their customers. However, there’s a lot of confusion about what ‘white label’ means.”

Rihm says CoreDial defines white label as “a service resold by numerous partners with no mention of the provider’s brand.”

There’s no brand confusion. The white label partner sells, delivers, manages and invoices for all services. As far as the end customer knows, the person standing in front of them from your company is the only name they need to know. As long as the platform works and provides value to the end customer’s business, the reseller/partner gets all the credit in the eyes of their customers.

“If you’re perceived as an agent, you really don’t have control of the business relationship with your customer,” said Rihm. “You make a fraction of what you should make, and the upstream provider really controls the service delivery, management, and invoicing. You’re also at the mercy of the provider; they’ve been known to occasionally decide to sell directly to the end-customer and squeeze out resellers.”

The evidence is overwhelming that this is a good time to expand your offering and provide customers with cloud communications. But the question is will you do it the right way?