Glossary -
Value-Added Reseller

What is a Value-Added Reseller?

In the competitive world of technology and business solutions, the role of Value-Added Resellers (VARs) has become increasingly significant. VARs provide a unique proposition by enhancing the products and services they sell with additional features, customization, or support, thereby offering more value to their customers. This article explores what a Value-Added Reseller is, the importance of VARs, how they operate, benefits to both customers and vendors, and examples of successful VARs.

Understanding Value-Added Reseller (VAR)

Definition of a Value-Added Reseller

A Value-Added Reseller (VAR) is a company that resells software, hardware, and other products and services while adding value beyond the original order fulfillment. This added value can come in various forms, such as installation services, customization, training, technical support, and consulting. The primary goal of a VAR is to provide a comprehensive solution that meets the specific needs of their customers, making the purchased product or service more useful and effective.

Importance of Value-Added Resellers

VARs play a crucial role in the technology ecosystem for several reasons:

  1. Enhanced Solutions: They provide customized solutions that better meet the specific needs of their customers.
  2. Expertise and Support: VARs offer specialized knowledge and ongoing support, which can be invaluable for customers who lack the necessary in-house expertise.
  3. Market Reach: VARs help manufacturers and vendors expand their market reach by targeting specific niches or geographic regions.
  4. Customer Relationships: They build strong relationships with their customers by offering personalized service and support, fostering long-term loyalty.

How Value-Added Resellers Operate

Adding Value

The core principle of a VAR is to add value to the products and services they resell. This can be achieved in various ways:

  1. Customization: Tailoring the product to meet the specific requirements of the customer, such as modifying software features or integrating different systems.
  2. Installation and Setup: Providing professional installation and setup services to ensure that the product works correctly from the start.
  3. Training: Offering training sessions to help customers understand and effectively use the product.
  4. Technical Support: Providing ongoing technical support and maintenance services to address any issues that may arise.
  5. Consulting: Offering expert advice and consulting services to help customers make informed decisions and optimize their use of the product.

Business Models

VARs can operate under various business models, depending on their focus and the needs of their customers:

  1. Product Resale: Reselling products from manufacturers or vendors, often with additional services bundled in.
  2. Managed Services: Providing ongoing management and support services for the products they sell.
  3. Consulting Services: Offering specialized consulting services to help customers implement and optimize their solutions.
  4. Subscription Models: Providing products and services on a subscription basis, which can include regular updates, support, and maintenance.

Relationships with Vendors

VARs typically establish strong partnerships with the vendors whose products they resell. These relationships can be mutually beneficial:

  1. Vendor Support: Vendors often provide training, resources, and marketing support to help VARs sell their products.
  2. Exclusive Deals: VARs may receive exclusive rights to sell certain products or access to special pricing.
  3. Feedback Loop: VARs provide valuable feedback to vendors based on customer experiences, which can help vendors improve their products and services.

Benefits of Value-Added Resellers

For Customers

  1. Comprehensive Solutions: Customers receive complete solutions that are tailored to their specific needs, rather than just standalone products.
  2. Expert Guidance: VARs offer expert advice and support, helping customers make informed decisions and optimize their use of the products.
  3. Reduced Complexity: By handling installation, customization, and support, VARs simplify the process for customers, reducing the complexity and time required to get up and running.
  4. Ongoing Support: Customers benefit from ongoing technical support and maintenance services, ensuring that any issues are promptly addressed.

For Vendors

  1. Market Expansion: VARs help vendors reach new markets and customer segments that they might not be able to target directly.
  2. Enhanced Product Offering: By adding value, VARs make the vendor’s products more attractive and useful to customers.
  3. Customer Insights: VARs provide valuable insights into customer needs and preferences, helping vendors improve their products and services.
  4. Reduced Burden: Vendors can focus on their core business activities, such as product development and manufacturing, while VARs handle sales and customer support.

Examples of Successful Value-Added Resellers

1. CDW

CDW is a leading VAR that specializes in providing technology solutions for business, government, education, and healthcare sectors. They offer a wide range of products from top technology vendors, along with services such as consulting, installation, and managed services. CDW’s success is built on their ability to provide comprehensive solutions that meet the specific needs of their diverse customer base.

2. Insight

Insight is another prominent VAR that offers technology solutions and services, including IT strategy, supply chain optimization, and cloud and data center transformation. By combining hardware and software products with their expertise and support services, Insight helps businesses implement and manage their technology investments effectively.

3. SHI International

SHI International provides technology products and services to corporate, enterprise, public sector, and academic customers. Their offerings include software licensing, hardware procurement, and cloud solutions, along with a range of professional services such as configuration, deployment, and support. SHI’s ability to deliver tailored solutions has made them a trusted partner for many organizations.

4. Zones

Zones is a VAR that offers a wide array of IT products and services, including networking, security, data center solutions, and end-user computing. They provide value through services such as assessment, design, implementation, and ongoing support. Zones’ focus on customer-centric solutions has helped them build long-term relationships with their clients.

Best Practices for Value-Added Resellers

To succeed as a VAR, companies should adhere to the following best practices:

1. Understand Customer Needs

A deep understanding of customer needs is essential for providing value-added services. Conduct thorough needs assessments and engage with customers to identify their specific requirements and pain points.

2. Build Strong Vendor Relationships

Establish strong partnerships with vendors to gain access to resources, training, and support. A good relationship with vendors can also lead to exclusive deals and better pricing, enhancing your competitive edge.

3. Invest in Expertise

Invest in training and development for your team to ensure they have the knowledge and skills required to provide high-quality services. Expertise in the products you sell and the industries you serve is crucial for building trust with customers.

4. Focus on Quality

Deliver high-quality services and support to build a reputation for reliability and excellence. Consistently meeting or exceeding customer expectations can lead to long-term loyalty and positive word-of-mouth referrals.

5. Offer Comprehensive Solutions

Provide comprehensive solutions that address all aspects of the customer’s needs. This may include bundled products and services, ongoing support, and tailored consulting services.

6. Stay Agile

The technology landscape is constantly evolving, so it’s important to stay agile and adapt to new trends and customer demands. Continuously update your offerings and skills to stay relevant in a competitive market.

7. Gather and Act on Feedback

Regularly gather feedback from customers and vendors to identify areas for improvement. Use this feedback to refine your services, enhance customer satisfaction, and strengthen vendor relationships.

Conclusion

A Value-Added Reseller (VAR) is a company that resells software, hardware, and other products and services while adding value beyond the original order fulfillment. VARs play a crucial role in the technology ecosystem by providing customized solutions, expert support, and comprehensive services that enhance the value of the products they sell. For customers, VARs offer tailored solutions, reduced complexity, and ongoing support. For vendors, VARs help expand market reach, enhance product offerings, and provide valuable customer insights. By understanding customer needs, building strong vendor relationships, investing in expertise, focusing on quality, offering comprehensive solutions, staying agile, and gathering feedback, VARs can succeed in delivering exceptional value to their customers and partners.

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