Recipe For Reseller Success: Open Systems' Open Code

ot every small business wants to make do with vanilla accounting software. With Open Systems’ two lines of accounting software, they don’t have to. The 30-year-old vendor not only encourages its channel partners to change the software any way their customers want, it also gives them the source code for just that purpose.

“A lot of small businesses are looking for specific features,” said Michael Bertini, CEO of the Shakopee, Minn., software vendor. “Because we give away the source code, our resellers can make additional revenue modifying the software while giving customers exactly what they want.”

Resellers say customers like such flexibility, at a price that starts at $500 per module for two to five users. “We came to one high-end gift store and said, ‘We know you’re used to some things that fit like a glove and not like a mitten. We know the source code will be important to you,’ ” said Jeff Wohlfhart, president of Advanced Concepts, Milwaukee. “We knocked $40,000 off a point-of-sale system built with our software and Open Systems vs. a Microsoft-based solution.”

Tony Moliterno, president of Independent Computer Services, Anaheim, Calif., said such pricing helps overcome the software’s biggest drawback: lack of name recognition. “We don’t have much problem selling it once we meet with people,” Moliterno said. “I talked to one company that had been quoted $30,000 for a [Best Software] Mas 90 system for five users. We quoted $13,000—and we offer the same feature set for five users [that] a 40-user customer would get.”

Open Systems offers two lines. Its Open Systems Accounting Software, which runs on Unix, Linux, Windows and Macintosh platforms, claims 250,000 SMB customers, while about 6,000 SMB customers run on its Windows-only Traverse software line. Last month, the company released Enhanced Payroll Tax Reporting for both applications. The subscription service provides more than 300 state and federal reports—such as those for withholding wages for hiring staff—that can be filled out electronically.

 Published for the Week Of December 6, 2004