There is no doubt that the subscription economy is here to stay, and at Quotevine we are firm believers. Although not every business is suited to being operated on a subscription model, the advantages for a younger business are numerous: lower cost of entry, increased flexibility, enhanced business focus, reduced expertise requirements, predictable expenditure, reduced administration requirements. In this article, I would like to categorise these into two broader groups, opportunity and execution.
The key to being successful in the modern world is being able to react to opportunities quickly, whatever sector you are in. If you want to start a new business or explore a new sales channel, you want to do so without committing any more capital than absolutely necessary.
Compare the typical technology start-up experience even as recently as the 1st dot-com boom (just over a decade ago) with today. In the ‘old’ days, to run a tech startup you needed servers, telecoms (an expensive leased line, probably), database software, OS licenses, development software licenses, Microsoft Office licenses, someone to administer your SCM server, an invoicing system, an payroll/accounting system etc. etc. Very expensive stuff.
Now – all of that is provided on a subscription basis! Pay monthly for a desk at TechHub – which includes access to a 1Gb/s Internet connection. Create your servers using EC2 or the Google App Engine, ‘creating’ and ‘destroying’ then as you need – OS licenses included! Invoicing/accounting: use Xero or SageOne. Documents and spreadsheets: GoogleDocs. For source code management, use Beanstalk. For defect tracking use Lighthouse, for live chat use SnapEngage. Collaborate for free with your co-workers on Skype. Truly a step-change in how easy it is to begin a business that needs technology to succeed.
I used a technology company as my example above, but the model is now spreading to other sectors. Quotevine offers all the functionality of systems that cost millions of pounds and take years to design and build, but instantly and without any capital expenditure and only pay-as-you-go charges. So, if you wanted to start a new finance house but were previously prevented from entering the market by the need to create all the systems infrastructure, and then hire staff to run it – now you can focus on lending money and let someone else manage the systems side of it.
The most exciting part is that you pay for all of the examples above on a needs-basis, with no contractual commitments. If your business (whether technology or finance) booms, your systems can automatically cope with the increased demand. If it doesn’t take off, you aren’t left with lots of expensive kit and now redundant software licenses to dispose of – and you only pay for what you use!
Once you are up and running, quality of execution is vital for your business to succeed. At Quotevine, we definitely could not offer our level of service without subscription services. The primary reason for this is that we can focus solely on what we do best: we don’t have to worry about the technology and services that are provided for us by our partners and that leaves us free to serve our customers and continue to innovate. It’s very easy to lose significant time managing things which add no value to you or your customers.
The flexibility of the subscription model is also vital here. Every business is reliant on its suppliers to maintain the quality of service it itself delivers to customers. We’ve all heard about projects where one business partner wasn’t delivering, but couldn’t be ousted due to the time and cost it would take to select a replacement. Now that subscription models enable you to build company infrastructure which can be swapped around, integrated and de-integrated easily, and completely disassembled if required, all in a matter of days, this should be a thing of the past.
For our customers – this means they can have 99.999% reliable systems provision while doing none of the usual systems operations themselves! I have worked at finance houses where the IT department was larger than the Pricing or Sales team: which can’t be right.
We think that the subscription economy is one of the greatest things to happen to business, and are proud to be part of it. To learn how we could help you get a new venture or a new business channel easily, quickly and cheaply: get in touch.