Why Use a Value Added Reseller (VAR)? Benefits for Organizations
October 18, 2023
“A value-added reseller (VAR) is a business that specializes in offering supplier software and technologies which may be coupled with integrations and services to enhance a product offering to its customers.”
Why Consider a Value-Added Reseller (VAR)
The concept of using a VAR to purchase software and hardware can sometimes be confusing for organizations. You might ask yourself:
- “What is a VAR?”
- “Am I getting a better deal using a VAR?”
- “What are the benefits of using a VAR?”
- “Can a VAR meet my needs?”
The goal of this article is to demystify the concept of using a VAR and to explain how it can bring your organization a broad spectrum of benefits relating to software and IT equipment, along with value-added service and support.
What is a Value-Added Reseller (VAR)?
A Value-Added Reseller (VAR) is an intermediary entity that enhances and sells products or services by adding specific value to meet the unique needs of end-users. Key attributes of a VAR include:
- Product Enhancement: VARs customize and improve the products or services they acquire from manufacturers to better align with customer requirements.
- One-Stop Solution: value-added resellers offer a comprehensive solution, bundling the product with additional services such as installation, training, and ongoing support.
- Expertise: VARs possess specialized knowledge and skills, providing customers with guidance and assistance throughout the product lifecycle.
- Intermediary Role: VARs act as intermediaries between manufacturers and end-users, simplifying the procurement process and offering a more tailored solution.
- Customer Focus: value-added resellers prioritize understanding the unique needs of their customers, ensuring the delivered solution effectively addresses specific challenges.
- Value Chain Integration: VARs contribute to the entire value chain by not only distributing products but by enhancing their utility through supplementary services.
The Value-Added Reseller Business Model
The VAR business model involves a software supplier of a given product selling directly to a third-party for the purpose of that third-party reselling the product. In a traditional value-added reseller model, the third party sells the supplier’s product to an end user without modifications. More commonly, software and hardware value-added resellers enhance the product with technology integrations and create a personal experience for the end user through a set of defined services.
Benefits of Working with a VAR
Personalized Experience
Although the VAR benefits from selling the supplier’s product, their objective is ensuring their clients succeed. A value-added reseller will assess a client’s business needs and provide an unbiased approach to determine the best solution. Given their extensive expertise, a VAR will have multiple products to meet client demands, meaning the client will only invest in products and services that make the most sense for the business.
Industry Experience and Expertise with Options
A value-added reseller commonly brings expertise in specific software within key industry segments, making them critical subject matter experts. Given the complexity of system and software integrations, a VAR is equipped to manage the end-to-end lifecycle by conducting a thorough needs assessment, defining clear goals and objectives to product purchase through implementation. This may include:
- Process Design
- Business Requirements and Processes Roadmap
- Configuration and Customization
- Data Migration and Integration
- Business Performance Reporting
- Training, Testing and On-going Workshops
- Go-Live and Continuous Improvement
- Maintenance and Support
Software customization can vary greatly depending on each business requirement. A value-added reseller understands the best methods for implementing and customizing the products they sell. As experts in a client’s business and industry segment, they can manage the more complex development and configuration needs such as building new modules and automation. Additionally, with a native understanding of the client’s business and industry, VARs understand how to leverage software to expand geographies and target markets. By increasing the value of a product through features and integrations, VARs can help companies build customer loyalty and generate new and recurring revenue streams to include the potential of cross-selling and upselling.
Reduced Internal Staff and IT Burden
Sourcing and implementing the right software and systems for an organization can be time-consuming and expensive. Likewise, identifying the right organizational stakeholders who have the comprehensive business knowledge and time available to dedicate can be a challenge. Often, an internal stakeholder may spearhead the project while attempting to meet the demands of their day job, jeopardizing the timing and budget of implementations. A value-added reseller reduces the burden of identifying and configuring the new software/systems, enabling an organization’s staff and IT to focus on driving business value. In the long-term, a VAR can offer professional and managed services to alleviate the burden of internal software and systems management.
A Financial Justification
Not only are cost savings realized by alleviating the internal burden on staff and IT, but because of their extensive business and industry sector expertise, VARs can identify potential costs and risks in forgoing a new product by retaining an existing product. Equipped with in-depth product knowledge and training on the products they sell, VARs offer clients quick insights into how a solution can meet their needs and delivers Return on Investment (ROI) awareness for purchase justification. If licensing is involved, a value-added reseller can assess the number of licenses needed, providing timely software renewals and add-ons to existing orders at prorated amounts, so the software scales with the client.
Increased Security
With cyber security as a top business priority, a VAR can provide a security analysis of the current and future-state systems maximizing cyber safety rigors. In doing so, value-added resellers ensure solutions and systems across the organization are optimized for protection.
Additional Capabilities of a VAR
Experienced value-added resellers have helped countless organizations across multiple industries successfully implement solutions that optimize every aspect of a business. Their insights into best practices for business processes and awareness of industry standards deliver significant value. For example, Cherry Bekaert Digital Advisory, a VAR for Microsoft, Sage Intacct, Tableau and Alteryx, specializes in helping organizations manage risks, enable growth and support sustainable operations by implementing relevant solutions to optimize business performance. By working with an experienced value-added reseller, organizations can be assured they are making the best business decisions with the right solutions in place to meet their strategic objectives.
About Cherry Bekaert
Cherry Bekaert’s Digital Advisory team drives transformation and helps middle-market companies grow by bringing together people, processes, technology and culture to help businesses sustain and flourish in the digital age. Our team is comprised of strategists, technologists and analysts who have broad industry experience and keen business acumen. We facilitate important change in productive and cost-effective ways by helping companies predict outcomes while adopting and applying relevant technologies to optimize performance. We meet you where you are in your journey and guide you on the proper steps to transform, optimize and execute your digital journey. We would love the chance to help guide your business. Contact us today!