How Can a Value Added Reseller Benefit Your Business?
A Value Added Reseller can become integral to a company, however, many companies aren't utilising them. But, first thing's first, what is a Value Added Reseller (VAR)? Basically, a VAR takes an existing product and boosts it by adding additional features or services. They then sell it on as a 'package'
So, how can they benefit your business? Well, VARs have broad expertise and can tailor features to specific verticals and offer customised solutions. There's also a lot of flexibility with a VAR and they are less likely to be biased as they represent multiple companies. VARs also make upselling significantly easier, as you get what you pay for. A product with extra features and/or services means there's no need for a consumer to purchase extras on the side.
Now, who are some of the biggest VARs? ComputaCenter, SoftCat, Capita and SCC to name a few. CRN Reported that ComputaCenter had a Revenue of £1.407bn and a profit margin of 4.2%, showing how successful great VARs can be, it takes a lot of work to have such a high revenue, meaning the quality that comes from a VAR needs to be very substantial.
Despite the positives of a VAR, there are some disadvantages to consider. Firstly, the long term cost. They tend to charge more than your typical vendor and over time the amount you pay can seem expensive, especially as your business gets bigger. There also isn't much control, Brandon Gaille stated that "Because products or services are an add-on, there can be fewer metrics available to determine who is purchasing products and why. When there is limited feedback, it can be virtually impossible to develop an accurate forecast for the items in question."
Overall, it's important when choosing a VAR to ask lots of questions and get to know who you're working with and make sure everyone is on the same page about how the end product/package will be. A VAR can be extremely profitable, so it's certainly worth considering.