We attended this year’s RSPA RetailNow conference in Las Vegas and saw three big trends unfolding:
- Even more prevalent than last year was the continued movement of payments into the POS ecosystem. To underscore this point Harbortouch quietly announced its acquisition of Restaurant Manager, a legacy restaurant POS company. Looking a the booth layouts makes this even clearer: not only do the payments companies have the biggest booths, they’re also occupying the most valuable real estate
- POS dealers are finally acknowledging margin compression across the POS stack. A number of session topics dealt with increasing dealer revenues and how dealers must change to maintain relevancy as the internet modernizes brick and mortar
- Legacy POS companies (ISVs) are beginning to understand why the cloud POS entrants they long chastised are selling directly: control over business solvency
Hi Jordan – understand well your overall point and mostly agree. To put things in perspective you should compare your $200k number to the cost of acquisition ISVs pay to non-dealers driven channels. You did that in another article. Also, In your calculation you deduct an extra $100k p.a. covering marketing/sales costs which by definition are not incurred by the ISV if the dealer acquires the account.
Good points Chris. I did a quick and dirty on the math here. I assumed the referral model would chew 30% of the revenue. The extra $100K I assumed comes from the ISV’s cost of selling/supporting those bolt-ons since dealers don’t want to do it.