Becoming a Value Added Reseller (VAR) is a lucrative way to add value and specialization to your product while saving yourself the development costs of manufacturing and developing the add-ons yourself. We’d like to offer you some tips in making this selling program work for you.
The most important thing is to establish yourself as a VAR with your vendors. Vendors realize that VAR’s are a key way to get their product into broader markets. While a vendor may design a piece of software or accessory for a computer, a VAR is frequently the source to discover new ways of using the same product. This can lead to symbiotic collaborations between both the vendor and VAR for future improvements.
Companies like Cisco offer special tools to establish these relationships. These tools can be used as models for other companies as well. To compare different programs, check out the rankings from various magazines. Computer Reseller News has a Program Guide to compare different computer hardware and software reseller support programs.
Make sure your vendors reflect well upon you. If your end product is “green” and you use environmentally sound manufacturing practices, make sure your vendor has similar production ideals. These days, information travels like lightning, and you do not want to be associated with anything that can cause judgment on your sincerity.
One example and difficulty many VAR’s face is using products “Made in China” as part of a component of a product manufactured in the United States. It’s become difficult to source many products within our borders. If your end product contains anything imported, make sure you can show your customers you’ve personally checked out all of your suppliers.
How do you become a VAR? The first step is to figure out which product will best enhance your own and meet the demands of your customers. Contact the vendors you are considering and see if they will give you demo or sample items.
Do your own testing—a lot of testing. Don’t depend on everything the manufacturer tells you as their tests may not have had your application in mind. Find other resellers to give you candidate opinions. Make sure you can troubleshoot and support the entire solution. Your throat is the one your customers choke.
Once you have a vendor, pricing usually depends on the sales volume. You may have to start out ordering your items at higher prices. Maybe they can offer you starter packages or terms. When sales increase, you’ll be able to enjoy the benefit of lower prices.
If you know the VAR route is right for you and you’d like assistance getting established, contact us. Using our Alliance Compass, we’ll get you pointed in the right direction.