We offer much better margins than our competitors
Check Point Software Technologies is leveraging its strong balance sheet to offer solution providers better margins, more affordable training and additional service opportunities.
The San Carlos, Calif.-based platform security provider plans to invest its spare cash to provide partners with better transaction recording, more service offerings and improved margins for onboarding new net customers as well as to gain up-sell and cross-sell opportunities with existing partners. customers, according to Frank Rauch, global head of sales channels.
“We believe we have the flexibility to offer you significantly higher margins than our competitors,” Rauch said Monday at CRN’s parent company, The Channel Company’s XChange 2022 event. “Compared to some of our competitors, we can do things for you financially that we don’t think the competition can do.”
[Related: Check Point CEO: ‘We Think That Our Business Can Grow Faster’]
Check Point has one of the “strongest balance sheets in the industry” in terms of operating margin, gross margin, free cash and zero debt, which Rauch says has allowed the company to form vendors and partner engineers at a fraction of the cost of competitors. Salespeople can be trained at virtually no cost to the solution provider, while engineering training costs half the price of its competitors.
“All we want is an opportunity,” Rauch said. “That’s all we ask.”
Check Point’s net income fell 3.7% in 2021 to $815.6 million, while Fortinet’s net income jumped 24.2% in the same period to $606.8 million of dollars. Conversely, Palo Alto Networks’ net loss worsened 86.9% to $498.9 million in the company’s 2021 fiscal year, which ended July 31. Neither Fortinet nor Palo Alto Networks immediately responded to CRN’s requests for comment.
Rauch said Check Point’s Professional Services training not only provides instruction for partner salespeople and engineers, but also the ability to shadow the company’s in-house experts. Check Point would absolutely love to offer free training to all of its partners, and Rauch said there are ongoing discussions about the matter. Engineering training requires 45% less time in the field than peers, Rauch said.
Check Point also has more than two dozen tools to help its channel partners, some of which are intended for partners to use with their customers such as assessments and security checks while others such as dashboards and quarterly business reviews are aimed at the solution providers themselves, Rauch says.
“It’s extremely important that we open up this services opportunity to you, because you want to make that margin and not let one of the manufacturers make that margin,” Rauch said.
For every dollar of security software sold, Rauch said the managed and professional services opportunity that comes with it is between $7 and $10. The company also plans to enter the managed detection and response (MDR) and managed prevention and response market, which Rauch says could be a good opportunity for both the company and its channel community.
“We think we have the best technology, and we also think we have the best opportunity,” Rauch said. “It’s one thing to have a great product. But a company must be able to provide this product to its partners in order to earn revenue from it. »
Ovation Technology was historically focused on reselling hardware, but the Olympia, Wash.-based state and local government-focused solutions provider plans to branch out further into software as a service to stay relevant to its customers, according to President Malcolm Waters. Ovation is specifically looking to do more around cloud security given how challenging cloud protection is for customers, he said.
“There’s a business opportunity there,” Waters told CRN. “We may need a little help to create these relationships and take advantage of the opportunities that are available to us.”