|November 18, 2004
MICROSOFT will tickle up the SME IT market next year with zero interest loans for small businesses.
The no-interest loans are part of a series of new small business products and services Microsoft hopes will crank up its own share of the hotly contested small to medium enterprise (SME) sector as well as ward off the pack of large enterprise application software vendors hunting down market for fresh revenue streams.
Microsoft senior vice president for small and mid-market solutions, US-based Orlando Ayala, said the zero interest loans had already been market tested in Latin America and would be available here within the next 12 months.
The loan facility would be sold through the existing Microsoft sales channel, but Microsoft would carry the risk. Customers would be able to purchase both Microsoft software and supporting other brand hardware with the loans.
Even after provisions for the no interest loans, Microsoft would still make good money on software sales, Mr Ayala said. "As you know, software is a high margin business," he said.
Also on the way is a version of the Office suite that includes customer relationship management and full accounting functionality.
Microsoft sees this new suite as its killer small business application and it will hit the US market in August 2005, with an Australian version expected in the first half of 2006.
"This is a very strategic product for us," Mr Ayala said.
Microsoft hopes to rope in accounting bodies such as the CPA to endorse the small business Office. The company is already setting up a beta test group in the US that will consist of 5000 small businesses coupled with 2000 CPA certified accountants. "The accountant is a huge influencer," Mr Ayala said.
The small business Office suite and other small business targeted Microsoft products would be available as "shrink-wrapped" products and as online hosted products. Customers would be walked through return on investment (ROI) scenarios to decide the best purchasing model.
Alongside its own software, Microsoft will sell other vendors services. As an example, Mr Ayala used large US payroll services outfit ADP.
To strengthen the small business sales pitch, Microsoft is creating a new certification level for its sales channel, which Mr Ayala described as a "small business badge." The would be rolled in Australia in September 2005, he said.