Solved

SPLA price increases - how do you charge your customers?

Posted on 2014-01-20
1
474 Views
Last Modified: 2014-03-25
I guess this is more of a business question than a technical question.  I'm curious how other service providers are doing it and what they have found to be successful.  Our company is relatively new to the hosting market.  We typically sign a 3-year, fixed-cost contract with our customers.  This obviously has problems when Microsoft is allowed to increase their SPLA costs every year to whatever they want.  We include a modest "buffer" in our price to compensate for this.  But it's impossible to know if or by how much Microsoft will raise it's prices the following year.  Do you write that into your contract that the cost is subject to change depending on what MS decides what the new cost will be?  I do not see how a customer will agree to that.  So my question is - how do you do it?  Do you raise the price for existing customers when MS does, or do you eat the difference?  How can service providers be successful without knowing what the SPLA cost will be from year to year?
0
Comment
Question by:ITLighthouse
1 Comment
 
LVL 27

Accepted Solution

by:
davorin earned 500 total points
ID: 39795199
I'm not familiar with details in our contracts, but we are changing prices as Ms does. It is impossible to have a "modest buffer" and still be competitive, while Ms is rising prices for 20, 30, 40 and more %. On my opinion this is not good for our business, but I guess there is no other option then signing an annex to existing contract with every price change. The costumer still has the possibility to terminate the contract, if thinks that the prices are to high.
0

Featured Post

Best Practices: Disaster Recovery Testing

Besides backup, any IT division should have a disaster recovery plan. You will find a few tips below relating to the development of such a plan and to what issues one should pay special attention in the course of backup planning.

Question has a verified solution.

If you are experiencing a similar issue, please ask a related question

Many companies are making the switch from Microsoft to Google Apps (https://www.google.com/work/apps/business/). Use this article to learn more about what Google Apps has to offer and to help if you’re planning on migrating to Google Apps. It is …
The System Center Operations Manager 2012, known as SCOM, is a part of the Microsoft system center product that provides the user with infrastructure monitoring and application performance monitoring. SCOM monitors:   Windows or UNIX/LinuxNetwo…
Viewers will learn how to maximize accessibility options in an Excel workbook for users with accessibility issues.
The viewer will learn how to use a discrete random variable to simulate the return on an investment over a period of years, create a Monte Carlo simulation using the discrete random variable, and create a graph to represent the possible returns over…

777 members asked questions and received personalized solutions in the past 7 days.

Join the community of 500,000 technology professionals and ask your questions.

Join & Ask a Question