The Pricing Of CP Manager… NO Agency Left Behind!
Another major topic of discussion here at the home office is around the price of our systems.
You have to remember, most of us have an extensive background in insurance automation and we’ve all watched the struggles agencies have had when purchasing a low-end, low-cost system when that’s really all they can afford. The problems are more than I have time to write about today.
The point is, as a company we’ve taken a posture of “no agency left behind regardless to their size”. We believe every agency should be able to own a state-of-the-art automation system to help them more efficiently run their agency. That’s because we know from first hand experience that …
the profitability in an agency goes hand in hand with how productive the agency staff is which is in direct correlation with the automation system they’re using.
Our Dilemma.
All of this creates a dilemma. That’s because if we price it where it should be priced and based upon what it’s worth we’ll alienate the smaller agencies which in many cases needs a productive system worse than a larger agency due to their limited budget and cash flow.
If we price it so it’s affordable for the smaller agency then we know the other vendors, especially the expensive ones, will try to present us as a “small agency only” system because of the price and the perceived value agencies will have because of the price.
You can see our dilemma.
On top of this, it’s been very clearly established over the past 20 years that the more single-entry a system is the more money they cost, and our system has been designed to be extremely single-entry. That’s because, as an Insurance Automation Consultant, I’m very clear on how doing double or triple entry of the same data is stealing your time.
CP Manager Must Be Single-Entry.
Not being single-entry is just wrong! It’s my belief that data already in the system should flow to other parts of the system where that data is needed, and if it doesn’t for any reason then there should be a button to pull the data in.
You can learn more about how single-entry CP Manager is at this informational piece: CP Manager Is VERY Single-Entry!
The more single-entry the system is the more it cost to write the system and the more it costs to purchase the system. CP Manager ended this standard long running tradition.
We’re Committed To ALL Agencies.
We are staying true to our commitment to all agencies and are pricing the system so even the smallest agency can afford to own an efficient management system that will dramatically increase their productivity.
That’s because we’re pretty committed to no agency left behind.
Over the course of President Mr. Chesnut working with and consulting with hundreds of agencies since 1989, he’s experienced first hand just how important price is, especially to a small agency. He has shared many stories with the staff of AAT where agencies were forced to purchase a lower priced system because of economics with the agency. Many admitted this wasn’t the decision they wanted to make, but due to their other expenses and their limited revenue, they just didn’t have any other choice.
Mr. Chesnut felt bad about this, but as just a consultant or as an account manager when representing a system, he had very little control over the price and had to follow the vendors pricing guidelines.
Early on he knew he wanted to be able to provide a world class agency management system to all agencies. No more being forced into a lower priced system because of the economics of the agency.
To accomplish this, we had to be smart about how we structured the company and designed the products. After all, there’s a very clear cost to have the system written and then to maintain it, along with supporting our clients on the system. So many things had to be factored in.
The solution was a number of things:
Full Subscription Or Modified Subscription, You Have The Option Between Them
We’ve designed a pricing structure which is flexible and allows us to adjust to the needs of your agency. Some agencies are more concerned with the upfront amount and others are concerned with monthly amount. We are able to adjust our prices to meet your needs.
In summary, the one with the lower upfront amount offers a greater short term savings over the first 2 years and the other with a lower monthly amount offers a greater long term savings from the 3rd year on.
You select the one that best meets the needs of your agency. Let me explain each…
Full Subscription.
The typical subscription (full subscription) is a low upfront amount and a higher monthly fee. What’s attractive to agencies with this pricing model is the low upfront amount and the lower first year cost. Smaller agencies are the most attracted to this pricing model.
Modified Subscription.
Our modified subscription plan flips the amounts. Here the upfront amount is higher and the monthly fee is low. Larger agencies generally choose this option. Here’s why…
Comparing The Two Pricing Models.
So you can make the best decision for your agency ( Mr. C will always have his consultant hat on), we’re going to share with you the differences between these pricing models.
The full subscription plan will always be less in the first year.
By the 3rd year the maxed out modified subscription will be less. The maxed out modified subscription is where we max out the upfront amount so the monthly amount is the lowest. As the months pass the spread between the maxed out modified subscription and the full subscription plan continues to become even larger with the maxed out modified subscription plan providing you with the greatest savings.
The point is, the monthly fee is what establishes the main cost of an agency management system industry wide, and this is why this industry has gone to a full subscription model because the vendor makes more money long term. This is why we educate our clients (we’re on your side), and why we are so focused on doing what we can to keep our monthly fees as low as possible.
You do what makes the most sense for your agency. At this point you now understand the difference between the two options. At least we give you a choice!
We feel it’s important to be flexible and to provide our clients with options.
Discuss what’s most important to you with your Account Manager who will provide a personalized price for you.
Two Systems
In order for us to achieve our company objectives such us, “Affordable for all agencies”, we knew we could only do this by introducing two systems.
For one, what we are creating with the TIME System is way beyond what the other systems offer and is an overkill for the small agency.
The reality is, the majority of systems on the market in their purest form are really just client and policy management systems designed to take care of your clients and their policies. Most systems also include accounting.
Plus, the needs of an agency are pretty significantly different based upon their size. A smaller agency primarily just wants to service their clients as quickly as possible. With a limited cash flow, hiring CSR’s is a big concern of theirs wondering if they’ll be able to afford them while also covering the expenses of the agency and still being able to provide themselves with an income. It’s a lot to juggle financially.
Being efficient and productive is very important to the small agency. In addition, building their book of business to get key contracts with carriers is also important. Lack of time is the biggest enemy to a small agency.
The smaller agency just simply doesn’t need everything the TIME System offers, so why should they have to pay for all of those features?
Pretty consistently, when talking to smaller agencies on TAM/Epic or AfW/360, they profess to only be using between 15-20% of the system, and then complain about having to pay for features they don’t even use. As far as that goes, Mr. Chesnut just recently talked to an agency with over 50 users who also stated they don’t use but 15-20% of their Applied Epic system so this isn’t isolated to just small agencies.
We don’t want to put our users into the same situation.
Our first system is CP Manager (CPM), which, like the other systems, is primarily a client and policy management system which will have 2 options for full accounting. (We address the accounting in a different article.)
But, CPM isn’t just another agency management system. It’s the first workflow driven system built from 25 years of in-depth agency automation experience. It’ll also be introducing re-engineered client management and policy management, along with overhauling a lot of standard features and bringing them to the 21st century.
Many are saying CP Manager will be the next evolution of the agency management system. Finally this industry will have its first workflow driven system.
Because CPM’s primary focus is on client and policy management and not managing the whole agency like the TIME System, we were able to keep the price down with CP Manager so even small agencies can afford it. In fact, CP Manager is less money than 70% of the systems on the market.
Agencies that need the benefits of the TIME system can upgrade to it. Because we planned for two system upfront, we were able to design the systems so there would be no data conversion costs, you won’t lose one iota of data, and you won’t have to go through a new learning curve. This is just amazing!
Another benefit to our clients on the TIME system is if they come across tough financial times, they can downsize to CP Manager. Then when they’re back on their feet they can upgrade back to the TIME system and they’ll see that they didn’t lose any data.
We have spent a lot of time strategizing…
- how to better serve our clients,
- how to meet the needs of a larger group of agencies from small to large, and
- how to help our clients if they come upon some tough times.
We’ve watched small agencies grow and then need to move to another management system that would better meet their needs now that they’ve grown.
With the TIME system we’ve created a logical upgrade path for growing agencies.
We really are committed to our clients.
Purchase The Add-On’s & Features YOU Want
As I shared above, pretty consistently, when talking to smaller agencies on TAM/Epic or AfW/360, they profess to only be using between 15-20% of the system, and then complain about having to pay for features they don’t even use.
Let me ask you a question. Would you prefer to have support fees increased as new features are added which you may never use or would you prefer to keep support fees lower and only purchase the new features if you want them?
Over 83% of agencies would choose to keep support fees low and only purchase features as needed.
This is what our approach is!
When we create new features that would increase the purchase price and/or support fees, we’ll make them a module our users can purchase. This way, if you want it you can purchase it. If you don’t need it or want it, then you don’t purchase it. It’s as simple as that!
Now, I already know other vendors are going to say we’re nickel and diming our clients to try and make our “client focused approach” look bad. With over 83% of agencies preferring to purchase new features if they want them to keep support fees lower versus having support fee increases and having a bunch of features in the system they don’t use, our approach makes the most sense.
If, however, our users would prefer to go to the other method and vote to have us change our approach here, we will. Just be clear that if we do it the other way, there will be a lot of users overpaying for support due to paying for features they don’t use.
And I won’t kid you any, it would unquestionably be better for the company if we just gave everyone the new features and increased the support fees since we’d make more money per client per month.
However, after working with agencies as long the President has, he insist upon always looking at our decisions from the eyes of the agency and asking if it’s fair to them.
We don’t think Mr. Chesnut will ever take his consultants hat off, which is very good for our agency clients. It’s important to Mr. Chesnut to always be fair to our clients, and not take the position like other vendors have that clients will just accept whatever we do believing they won’t move to another system. Yes, they will, if you make them mad enough!
So take a look at what Mr. Chesnut is doing in this next topic ….
The Pricing of Add-On’s For Existing Clients
Vendors are notorious for offering prospective agencies a discount on an add-on module if they purchase by the end of the month, but they won’t offer existing clients the same pricing for the add-on. This has never made sense to Mr. Chesnut if the clients are truly the vendors highest priority.
We’re going to do what we feel is the right thing to do because our clients really are our highest priority and offer add-on’s for the same discount price we offer them to prospects.
Here’s how this will work… There will be months when we will offer an incentive to prospects to purchase the system. These will generally be in the form of a discount on add-on’s. There is no room for discounts on the base system and additional users which are already priced as low as we can go which is why it would be an add-on module or service.
On the months we offer prospective agencies a discount on an add-on like PL downloading, we’ll send out an email to all of our users informing them of this to give them the same opportunity to purchase the add-on module for the same price a prospect can purchase it for. We are also posting the discounts for the month in the Client Only portal of our system for our clients to see.
To us, this is very fair and the way it should be since our clients are our highest priority.
In addition, when we introduce a new add-on module, for the first two weeks we will offer all clients an introductory price for it.
Be very clear that our clients truly are our highest priority. There should be question about this based upon all of the things we’re doing to take care of our clients and not take advantage of them just because they are a client.
Making The System Self-Sufficient
There are a number of systems that require the agency to purchase 3rd party programs like MS Word for letter writing or MS Outlook for emailing or expensive faxing systems in order to fax out of the system. All of these things increase the overall cost of the system to the agency. But this isn’t the only problem with this approach, as I share below.
We took a different posture … we’re building everything into the system.
The letter writer in our systems is built into the system, emailing is built into the system, and faxing is built into the system. This accomplishes a couple of very important objectives our users should really appreciate:
First, it keeps costs down. When you purchase the CP Manager you are not going to be required to also purchase other 3rd party programs in order to fully use the system.
Second, when you’re using a tablet or smart phone to access the system, there are no limitations of what you can do in the system. Plus, there’s no need to download other software programs which a tablet or smartphone may not even be able to install.
Finally, because they’re built into the system it allows us to more thoroughly integrate them into the system creating a far better integration. When you integrate with a 3rd party program, the limit of integration is based upon the API they provide to you. When it’s fully integrated into the system, the sky’s the limit.
CP Manager Is Priced Less Than 70% Of The Systems On the Market.
Our price for CP Manager is based upon what we need to charge for it. Excitedly, it’s less than 70% of the systems on the market, and even more if you factor in the cost to host the other systems to run the systems from the internet.
This also means there are roughly about 30% of the system who are less money than CP Manager. However, we’ll easily more than make up the difference by…
- How single-entry CP Manager is saving you from being frustrated and wasting your time by re-entering data already in the system. And,
- How we’ll save you time and money in learning CP Manager because of how easy to use CP Manager is (this is just one of many benefits to having an easy to use system). And,
- How we’ll save you time when doing your work because of having less windows and less mouse clicks to do your work. And,
- How the My Activities Dashboard puts work in progress and key policy issues your staff need to stay on top of all on one page which will save you a tremendous amount of time and save you from jumping throughout the system to find what you need. It also helps to better protect your agency from E&O exposures. And,
- If you do Commercial Lines you will be thanking us for designing a Commercial Lines powerhouse that’ll make managing your commercial lines clients and their policies so much easier and more efficiently (that, or you’ll be constantly frustrated if you select a system lower priced than CP Manager and have to deal with commercial lines in those systems). And,
- By not having to purchase MS Word or Outlook for each user since we built the correspondence into CP Manager. Plus, by CP Manager being hosted online we’re saving you a lot of money in networking costs and maintenance.
By the time you factor in all of the above, a system with a lower purchase price than CP Manager could easily be more expensive to the agency in increased expenses year after year. The purchase price of a system is just one part to establishing the real annual cost to a system.
To learn more about this and to see how CP Manager keeps your other costs associated to a management system low read the informational piece, “The Big Savings When Using CP Manager“.
Another great informational piece every agency should know is “The Cross-Roads To An Agency“.
Summary
When you combine all of the five things above together it adds up to a huge savings to our clients, and gives our users options on how they purchase our systems.
Over the years we’ve watched what a lot of vendors have done in the area of price and talked to a lot of agency about what they like and don’t like about the different pricing structures and approaches.
In addition, we don’t believe you’ll ever be able to take the “consultant” out of Mr. Chesnut who, as a consultant, was always looking out for the agency. He still does today. Just spend an afternoon in a company meeting and listen to him and you’ll see what I mean, or re-read this page to see all of the things he’s putting in place to better serve our clients. This is why one of our core objectives is…
“To provide world class automation to massively increase our users productivity by helping them to be far more efficient, then pricing it so any agency, regardless to size, can afford to own and benefit from a highly productive management system.”
PO Box 13405
Spokane Valley, WA 99213
Phone: 208-242-4321
Fax: 509-368-7325
info@AgencyATeam.com
www.AgencyAutomationTeam.com
Isn’t it time you got your time back?
Now you can with CP Manager!
Schedule your Walk-Through Now and See For Yourself What a Highly Productive System Can Do For Your Agency!