Opening Store, Moorehead, Wireless Zone or Direct???
Looking to open up VZW in IL/WI market. Been a sales rep/manager in indirect for a while, finally have the capital to open my own store.
I'd like to go direct, but I've been hearing a lot of talk that VZW isn't allowing direct premium retailers, only master agents.
It seems like all of you hate being Verizon agents. Any advice you can offer on starting up shop, who to go with, and what to expect is greatly appreciated.
Run. Run far, far away. Don't look back. Take that capital, open a yogurt shop, or maybe a deli or a bicycle shop. Maybe a sporting goods store...Any kind of business where people actually walk into your store to BUY things, not expect you to whore yourself and your phones for "free". That is the key.
Low price, Excellent Service, High Quality. Pick any two, but you never get all three.
Verizon is not taking anymore direct dealers so you have to go master agent. Verizon has been very difficult with allowing current dealers to open new doors period let alone allowing for new dealers.
Last year Verizon kicked out all of the dealers they did not want involved in the program before the iphone launch so I believe all of the current dealers are safe for some time to come.
Master programs make it even harder to be successful since you have no direct representation with Verizon but are instead dealing with the master agent who pays you. The good thing about Wireless Zone they do not open their own stores and compete with you, Moorehead on the other hand will only give you the crappiest locations and take the good locations for themselves. You would be crazy to open with Moorehead knowing they open their own locations. Wireless Zone takes a franchise fee so keep that in mind. Verizon is not the strongest carrier in the IL market from my understanding, I think they are #3 in IL so it will not be an easy ride.
Verizon does much better in north east markets but those are saturated. Find a small town to open a store in with a master agent you will do much better than going into a big city.
In regards to JP Whoregan's post, I am family with wireless customers. I don't do free. I'm currently working with an AT&T agent until my no compete with my previous VZW agent is over, and you have no idea about the objections I face. When working at VZW for a year, I had two people my whole time there come in to inquire about canceling service. At AT&T its a weekly thing. I never had a single objection about the network at VZW, its an hourly thing at AT&T. People want VZW, and are willing to pay $300 for a Droid Charge, plus 3 accessories. You just have to know how to position it to different kinds of customers.
To VZWINDIRECTGUY, I am also considering Wireless Neighborhood/Celluphone. Any idea about them? Verizon is still taking Direct's in my market, and a lot of doors are opening here too. I know they cut the fat on a bunch of direct dealers last year, but if you can put up numbers with activations and dash they'll work with you.
Now that they discontinued the $100 mail-ins on Smart phones, do they throw spiffs on the back end? How does that work. Also, now that they data plans have changed, do you get paid for switching someone from the unlimited to the 2GB plan?
In regards to JP Whoregan's post, I am family with wireless customers. I don't do free. I'm currently working with an AT&T agent until my no compete with my previous VZW agent is over, and you have no idea about the objections I face. When working at VZW for a year, I had two people my whole time there come in to inquire about canceling service. At AT&T its a weekly thing. I never had a single objection about the network at VZW, its an hourly thing at AT&T. People want VZW, and are willing to pay $300 for a Droid Charge, plus 3 accessories. You just have to know how to position it to different kinds of customers.
To VZWINDIRECTGUY, I am also considering Wireless Neighborhood/Celluphone. Any idea about them? Verizon is still taking Direct's in my market, and a lot of doors are opening here too. I know they cut the fat on a bunch of direct dealers last year, but if you can put up numbers with activations and dash they'll work with you.
Now that they discontinued the $100 mail-ins on Smart phones, do they throw spiffs on the back end? How does that work. Also, now that they data plans have changed, do you get paid for switching someone from the unlimited to the 2GB plan?
They lowered our cost on the phones and added a temporary spiff to make up the rest of the difference. Once the temporary spiff ran out we ate the difference and then the cost slipped back up somewhat as well. Most new devices released since have been better off especially 3g devices. We've been losing on Thunderbolt upgrades with existing data plans until recently. The Thunderbolt went down $30 our cost and now has a $50 spiff through August. I'm thinking a restructure on data devices may be coming because all 4g phones currently have a spiff in my area so we can actually profit.
We do not get paid on a data plan to data plan feature change. Only if its dumb phone to smartphone but unlimited to a new tired plan does not pay. Even blackberry to other smartphone don't pay now because its all one feature code.
Wow, that sucks. I miss the Ally. Very profitable phone.
So wait... you don't get any payout on the the data???? What if you move someone from $30 unlimited to $50 4gbMHS/5gb.. do you get paid for the difference at least?
Thats one thing I'll say AT&T does better than Verizon. They embrace their indirect channel. Listen to this. If a dealer adds a feature, they get 4x the monthly recurring charge. Any transitions from old features to new features, you get the full pay out. So if you switch someone from an old $30 unlimited plan, to a $25 2GB plan, you get the payout... $100. BEST PART! If you upgrade a primary line, you get the payout for all the the features on that line, even if you didn't add them. So imagine upgrading a primary line for a family account that has data and family text. Its like $200 in features that were already on the account!!!!
But at the same time, AT&T has CRAZY charge backs. They will charge you back if you don't do the activation properly or don't notate the account properly. With Verizon, you couldn't mess up an activation. With AT&T, there are all these procedures, notations, and crazy policies. Doing an alternate upgrade or new primary lines takes FOREVER.
Wow, that sucks. I miss the Ally. Very profitable phone.
So wait... you don't get any payout on the the data???? What if you move someone from $30 unlimited to $50 4gbMHS/5gb.. do you get paid for the difference at least?
Thats one thing I'll say AT&T does better than Verizon. They embrace their indirect channel. Listen to this. If a dealer adds a feature, they get 4x the monthly recurring charge. Any transitions from old features to new features, you get the full pay out. So if you switch someone from an old $30 unlimited plan, to a $25 2GB plan, you get the payout... $100. BEST PART! If you upgrade a primary line, you get the payout for all the the features on that line, even if you didn't add them. So imagine upgrading a primary line for a family account that has data and family text. Its like $200 in features that were already on the account!!!!
But at the same time, AT&T has CRAZY charge backs. They will charge you back if you don't do the activation properly or don't notate the account properly. With Verizon, you couldn't mess up an activation. With AT&T, there are all these procedures, notations, and crazy policies. Doing an alternate upgrade or new primary lines takes FOREVER.
It's a whole weird thing with the data now. The new data plans and hotspot are paid as a bundle, but only at the time of sale. If they add just data and add hotspot later you don't get paid. If they are on an old unlimited plan and add the old hotspot feature to go with that plan then I think we would get paid. If they move from old unlimited data to a new tiered plan, we do not get paid. Not sure what happens if its bundled with hotspot, I'm assuming no pay. Data plans are now paid at the time of sale. So you get paid according to the plan they take at the time of sale and the commission doesn't change if the customer changes tiers, it will only be taken away if they totally remove data.
How the hell can you afford to stay in business? I've been crunching the numbers, and that just doesn't make sense. Without the data payouts, that crushes your GP. I thought for sure they would pay out from $30 unlimited to $30 2GB because if dealers weren't motivated to push that transition they'd lose smart phones to basic phones or whole accounts to t-mobile or sprint. That means it would be more profitable to put people into basic phones and verizon loses out on $720 of revenue over 24 months
How the hell can you afford to stay in business? I've been crunching the numbers, and that just doesn't make sense. Without the data payouts, that crushes your GP. I thought for sure they would pay out from $30 unlimited to $30 2GB because if dealers weren't motivated to push that transition they'd lose smart phones to basic phones or whole accounts to t-mobile or sprint. That means it would be more profitable to put people into basic phones and verizon loses out on $720 of revenue over 24 months
The payout in my area for the data feature isn't that much. Only $50. We get regular commission plus a smartphone commission which makes smartphones profit about the same as a basic phone. Some devices the data feature payout is more critical but we've never been paid on the data if they already had the same feature before so not much of a difference. You just know you can't count on that extra money. I think verizon is trying to prevent dirty tactics with this payout method. If we got paid that would give us incentive to be dishonest to customers and move them off unlimited data. If you truly care about a customer you wouldn't do that but we all know money talks. This way there is no reason for a dishonest rep to change someone off unlimited. I don't think verizon cares that people keep unlimited or have any rush to move people. They are just planning for the future with the new plans. They don't want to deal with the nightmare of people being moved off their plan and don't being told so or whatnot. Its also saving them a lot of commission payout by not paying for those changes from one to another. I really do think a commission overhaul is coming with regard to smartphones, 4g, and tablets so that payout is better for the things they want us to sell. Right now were in between with the new plans and ALP coming. Once its all in place I think we'll see changes.
How it worked in our market was you get your $150 smart phone reimbursement to go toward the cost of the smart phone, then $50 for adding data. And that works fine when the customer is paying $100 mail in rebate, but when I'm crunching these numbers, it just seems more profitable to sell basic phones with the $10 data, than sell smartphones.
How it worked in our market was you get your $150 smart phone reimbursement to go toward the cost of the smart phone, then $50 for adding data. And that works fine when the customer is paying $100 mail in rebate, but when I'm crunching these numbers, it just seems more profitable to sell basic phones with the $10 data, than sell smartphones.
That's absolutely true. As a channel, indirect is making more profit selling basic flip/qwerty phones than we are making on most smartphones. About a year ago, VZW adjusted the commission structure to fix this, and we actually saw about an $80 to $100 profit increase on smartphones across the board. However, they went and killed the $100 MIRs on most of the smartphones, but only dropped the wholesale phone prices about $60 to compensate. Bottom line is, when GP on an LG Accolade is around twice to three times as much as a Droid Charge, the system is definitely broken somewhere. We do not dissuade a smartphone user from upgrading to another smartphone, but I can sure as hell promise that we aren't fervently pushing feature phone users into smartphones, either. When a customer walks in and says they just want a "basic phone", that's music to my ears.
Reck, in response to your question about celluphone if I had to go with anyone at the moment it would probably be them since they are the easiest to deal with, have no franchise fees, and have enough dealers to not fear them going out of business. There are some negatives but dealing with any middle man you are going to run into that.
The biggest challenge is just finding a location. Many markets are saturated and a market like the midwest where Verizon is probably the #3 carrier (behind tmobile and at&t, Chicago is t-mobile's #1 market) you have to know the odds are against you. In other markets Verizon is #1, even with a saturated market you will get some of the upgrades come to you from the first week you open.
Good points you brought up about AT&T, that does add up big time. AT&T has a far superior program for dealers because the start up costs are much less, they help you find real estate, and the equipment policy is alot better than Verizons.
Keep in mind though, the wave is definitely steering in Verizons direction and Verizon dealers are going to benefit along with Verizon. Verizon has alot more demand and many more exciting products coming down the pipeline then AT&T. Since Verizon got the iphone they are now doing more NEW lines than any other carrier, they are almost in their own world now.
That's absolutely true. As a channel, indirect is making more profit selling basic flip/qwerty phones than we are making on most smartphones. About a year ago, VZW adjusted the commission structure to fix this, and we actually saw about an $80 to $100 profit increase on smartphones across the board. However, they went and killed the $100 MIRs on most of the smartphones, but only dropped the wholesale phone prices about $60 to compensate. Bottom line is, when GP on an LG Accolade is around twice to three times as much as a Droid Charge, the system is definitely broken somewhere. We do not dissuade a smartphone user from upgrading to another smartphone, but I can sure as hell promise that we aren't fervently pushing feature phone users into smartphones, either. When a customer walks in and says they just want a "basic phone", that's music to my ears.
With the price drop on the Charge and the current $50 spiff I profit $135.99 on a Charge. If no date previously then I make $185.99. I make $86 on a Revere doing it for $50, which is what we do so it's free after rebate. Things are getting better, hopefully it keeps going that direction.
Bottom line is, when GP on an LG Accolade is around twice to three times as much as a Droid Charge, the system is definitely broken somewhere.
Especially if they force these DASH numbers on you. Thats ridiculous.
Originally Posted by VZWINDIRECTGUY
Reck, in response to your question about celluphone if I had to go with anyone at the moment it would probably be them since they are the easiest to deal with, have no franchise fees, and have enough dealers to not fear them going out of business. There are some negatives but dealing with any middle man you are going to run into that.
The biggest challenge is just finding a location. Many markets are saturated and a market like the midwest where Verizon is probably the #3 carrier (behind tmobile and at&t, Chicago is t-mobile's #1 market) you have to know the odds are against you. In other markets Verizon is #1, even with a saturated market you will get some of the upgrades come to you from the first week you open.
Good points you brought up about AT&T, that does add up big time. AT&T has a far superior program for dealers because the start up costs are much less, they help you find real estate, and the equipment policy is alot better than Verizons.
Keep in mind though, the wave is definitely steering in Verizons direction and Verizon dealers are going to benefit along with Verizon. Verizon has alot more demand and many more exciting products coming down the pipeline then AT&T. Since Verizon got the iphone they are now doing more NEW lines than any other carrier, they are almost in their own world now.
Yeah, Celluphone is the best from what I've seen, but they don't offer residuals, however, that is fine because it would take a lot of residuals to pay off a franchise fee, and I'd plan to go direct by then.
But thats the best part about Illinois. When I worked with my previous agent, every customer was a new line. In 12 months, I only had 1 month where I did more upgrades than new lines. Illinois is a new line factory.
Opening Store, Moorehead, Wireless Zone or Direct???
Reply With Quote
Originally Posted by ReckToday1
Bookmarks