A Warning to Those Who Resell

Reselling another product or service is a great way to make a small but residual income. Sell enough of these side products, and you’ll soon be seeing great profits as a result.

There is a downside, though: your reputation is at stake.

I’ve penned previously about why you need to be careful who you partner with. Choosing the wrong supplier can reflect badly on you and your business, even though you’ve probably had very little to do with the delivery of such a service or product.

Last month, I visited the USA for the first time. Quite a feat from where I live, with over 20 hours in the air one way, and no less than eight flights in two weeks.

Seven of those flights were great, and one was lousy. In fact, it wasn’t the actual flight that was lousy – it was the service of my airline when disaster struck. See, I got delayed due to bad weather and missed my connecting flight. I ended up at an airport in a strange city at midnight, after already spending half the day in the air, and really didn’t want to miss that flight.

Nature does get in the way though, and although not either airlines’ fault, I enquired about what happens next. It took me no less than two hours, speaking and negotiating between two airlines to sort it out. My biggest peeve was the fact the airline I had actually booked with – and paid my money to – had sold me another airline’s service, commonly called ‘Code Share’ and a frequent practice in air travel.

That was fine. However, when crunch time came, they weren’t interested. The airline they on-sold to me was left to pick up the pieces and the logistics of getting me on another flight. They were great – my original airline, not.

If you sell hosting or domains or any other third party product or service and rebadge it as your own, you have a real obligation here. You’ve made a commitment and a recommendation, and if your customer came back with an issue or complaint, I’d expect you to bring out your best customer service and solve it.

My experience with most small businesses is exactly that – even though you may only make a tiny portion of the profit, they are your client, and therefore you have the responsibility, rather than just blaming it all on the third party.

It’s a shame billion dollar airlines don’t feel the same way as you and I. Next time a customer of yours has an issue with a service you’ve resold, be acutely aware of how you deal with it – your response can really make or break a relationship.

Me? Well, I booked return flights for 16 people last week. Guess which airline I didn’t use?

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  • http://heydavecole.com Dave Cole

    Good insight Miles. Being a reseller – or even allowing advertisers / sponsors on your website – opens up a whole world of opportunity, but potential harm. “Trust by Verify” is a pretty good mantra to go by when it comes to aligning your brand with others.

  • kaf

    By the same token if you are the upstream provider and a third party is selling your product, then you have a responsibility to the customer too. Just because you didn’t sell the product does not mean it is not your responsibility. I’ve been a re seller for a few products and I found too often the company who actually provides the service treats my customers and myself like second class citizens. And often it is too late to easily switch to a different provider by the time you realise they have this attitude.

    That being said these companies were the exception to the rule. Most are quite good. But for those few bad eggs, the sense of helplessness I felt at being unable to help a client who is frustrated at me for something that wasn’t my fault has meant I now no longer resell anything.

    I’m a firm believer in Not Invented Here Syndrome. If I’m going to get the blame then at least I’m going to have control.

  • http://blog.findmyhost.com chris henning

    I think this is so true, I had similar experiences in Web Hosting. You sign on when they promise the world and then they gradually change the partnership after you’ve sent them a bunch of customers! Not cool at all.

    Most people who resell do not have the resources to fund equipment or products on their own. Once you are established though and have a good income stream, I would suggest conversion of those clients. A good strategy is to convert resell customers over to your own customers over time.

  • http://www.jumbocdinvestments.com/ ChrisCD

    We to use other companies from times-to-time, and if that company makes a mistake, I own it, too. I work until a solution is found.

    We also host ads on our site (adsense). I do go through them and if I see ones that are outlandish I block those sites and report the ads.
    cd :O)

  • http://www.brandoneley.com Brandon Eley

    Great article, Miles. I’ve experienced this exact issue recently, and there’s nothing more frustrating than having the company you paid just shrug their shoulders and say “nothing we can do.”

    As industries get more and more competitive over the next few years, “customer service” will have to stop just being lip service, or a lot of companies are going to be in trouble.

  • http://twitter.com JailaLoff

    Hi!
    like you post: to my @iceqeaks twitter