Retailer's Guide to Communications Cost Savings with SD-WAN

Constantly protect your purchasing leverage for telecommunications with SD-WAN

Managed Private Networks – the cost traps

Getting your telco to manage your private networking might seem like a good move, but there are traps when the fox looks after the henhouse.

Expensive private networks – MPLS

Current private networks offered by your usual gang of suspect telco companies are usually built on “MPLS” and include an expensive router, managed by their staff in a very rigid way.

There might be a fibre connection that your telco uses to deliver the communications circuits. They might also use it for phone services, as well.

What you probably don’t realise is the high-cost/low-efficiency of these sorts of services that they pass on directly to you, years after the equipment they installed was paid off. If you look under the covers, the high-uptime and great quality don’t really stack up any more – not surprising with a design from last century.

You would be quite justified if you are upset at being locked into an expensive contract if the service hasn’t been keeping pace with usage. And if the bandwidth that you get is very expensive.

It probably seems like they aren’t keen to make services get better until you can pay for it next time.

MPLS networks have high costs

Huge International communications costs

Our more exciting retailers are expanding internationally, but their telecommunications carriers aren’t helping. You would think that with the explosion of the Internet, getting fast and reliable networking services to your overseas offices and stores would be easy.

Not so, if you want to expand your private network out there!

Having a local (or global) carrier deliver old-style MPLS services out there is a slow, painful, expensive process, fraught with unpredictable delays as well as many companies being hidden under the covers of one-bill convenience.

Being able to build your own private network in these countries with a faster local carrier can transform the process into a snappy procedure with a predictable timeline that makes it a breeze to bring up a new store network or set up offices on demand.

Watch out for bundling and vendor lock-in

You might not have an IT department that can solve every single IT challenge for you, so a managed service is a great option.

And it might be appealing to leave it all to your Big Phone Company to run your communications network as well as supply your network links.

But losing financial control like that has proved to have downsides in both costs and service levels with many retailers up to now.

Retailers are discovering that they get stuck with

  • expensive multi-year contracts that have significant exit penalties
  • weak service level agreements (SLAs) where there is no penalty on the provider if sites go off-line, or for poor performance
  • exposure to downtime, where no-one gets notified of a fault, resulting in stores being “off-line” and in-store POS systems needing to record transactions for syncing back to the main system at a later time, or VOIP phones stop ringing.

Quick wins

When you address the traps with an SD-WAN approach, there are some great quick wins that keep everyone happy – Finance, IT and your front-line staff!

“Backhauling” eats your traffic with MPLS

Old network designs involve backhauling all of your data traffic back to your central data centre – even traffic that’s meant to go out to the Internet. That double usage of all of your links results in you buying a lot more capacity that you need.
When you move to an SD-WAN, you can breakout your Internet traffic at each site. Your old private network links suddenly operate much better – users will see an improvement immediately! And you might be able to dial back link capacity and costs when you can see how much expensive capacity you really need.

Simplify your stores

Some businesses deploy a lot of extra security (or other) IT equipment that would work better elsewhere.
Removing edge firewalls and security devices from all of your stores sometimes result in huge amounts of IT staff time not being wasted on applying patches and adjusting configurations on hundreds of systems. People time is big $$$.

Cloud-powered security removes all of that equipment, maintenance and configuration out to a simpler cloud service that makes sure that nothing bad comes in and nothing important goes out when it shouldn’t.

Avoid Office365 nightmares

Moving to Office 365 for lots of staff can throw up unpredictable performance issues, that can’t be solved by simply adding bandwidth.
When users get slow and unpredictable Office 365 performance, they need to watch out for a lot of other effects that are difficult to see with traditional networks – latency, session limits, packet loss and congestion. SD-WAN and cloud-powered security are a simpler, cheaper option.

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