Sales data to June 2018 shows 100% of Large SaaS Suppliers are making sales
But 80% of SMEs have not made a sale in the same period
The answer is not in the oligopoly, perfidious buyers or bad framework design (I don’t deny they exist)
The biggest problem is 80% of SMEs think that’s the answer – when it’s actually something they are doing
And it’s relatively easy to fix
There is some interesting data about SMEs in the latest sales figures published for G-Cloud. These nominally run to the end of July 2018, but there are always significant errors in the last month due to late filing of returns by suppliers. For SaaS, I estimate about a third (£6m) of July’s sales are missing, so let’s look at the 12 months to end June 2018.
G-Cloud 10 had not started then and so we are actually looking at approximately 1,766 SaaS suppliers on the Digital Marketplace at June 2018 and we can match them to sales in the 12-month period with a small error (explained as a footnote).
G-Cloud SaaS sales: 12 months to June 2018
Number of vendors by size category with sales in the ranges shown
(The second table expresses this as a % of the total number of vendors in that size category)
% of line
% of line
% of line
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The simple facts are
- All Large suppliers have made sales, over 60% more than £100,000
- About 20% of SMEs have made sales with only 10% over £100,000
I like to keep an eye on the £100,000 watershed because, for a SaaS SME, this is about the level of annual revenue generation at which you are breaking even with the equivalent of one full-time person assigned to market entry. It’s a milestone on the success pathway.
G-Cloud is a problem for SMEs
SaaS performance continues to disappoint 80% of SMEs.
This is much to the bafflement of Crown Commercial Service. For every iteration of the framework (that’s 10 now) patiently, politely and in plain English they have been saying:
- You should publish a useful and effective Service Definition
- You need full and clear pricing, sufficient to calculate full cost of ownership
60% of SaaS suppliers on G-Cloud 9 had no Service Definition or none conveying anything useful; 50% didn’t provide anywhere near enough pricing.
SMEs are a problem for G-Cloud
A small number of SMEs are making good sales on G-Cloud. I haven’t met one who will say the playing field isn’t severely tilted in favour of the national and global brands – but they all say it can be done – and – that the majority of SMEs are the authors of their own disappointment.
These two fundamental problems are relatively easy to remedy. Take a look at the first two Insight Articles on Service Definition and Pricing. Correct these flaws and you begin on the success pathway – the full map is outlined on the page How-to-Win and I’ll be adding to information and resources over the next several weeks.
Selling SaaS to Public Sector isn’t a cake-walk but G-Cloud has made it easier and it isn’t the insurmountable obstacle the facts seem to suggest. Look at it this way, we apply understanding, logic and process to creating technology products – here we are trying to do the same for our sales and marketing effort, it works.
Footnote – errors in reconciliation
Because sales in 12 months to June 2018 come from G-Cloud 5-to-9 there are suppliers on the sales list who are no longer on the catalogue at June 2018. The error is small and does not materially alter the conclusions.