Turning a Product or Service into a Solution: the Value Add of a Reseller
There is quite a bit of chatter on the web and among IT resellers about how opportunities to serve business customers are diminishing, yet business adoption of cloud computing, managed services, and mobile technologies is growing tremendously. It seems that use of technology is increasing, but the opportunity for “traditional” IT resellers and channel partners to make money by selling IT-related products and services is diminishing. This is not new, and is simply a finer form of the problem that has been revealing itself for years. In order to provide value, suppliers must provide businesses with solutions to business problems rather than just trying to sell them products and services with a hefty profit margin.
Whether it is a physical item like a computer or an intangible item like consulting services, businesses will buy if they see value in it. In the eyes of the consumer, the value is likely tied to far more than the item at hand; the value tracks to some expectation of business benefit to be achieved now and in the future. Businesses will pay for solutions to problems they experience more readily than they will pay for shiny things or big ideas, and it is this truth that many “value added” resellers tend to forget even though it is part of their business description.
For many years channel resellers have struggled with competitive elements that reduce revenue and profit potential on core products and services. When computer hardware prices dropped years ago and businesses found that going through distribution or direct to the manufacturer was often a more affordable path than buying through a reseller, the resellers re-trenched and began providing more value in terms of solution architecture, training and implementation support, and system management services. As the delivery chain for information technology continues to compress and more products and services are delivered direct-to-consumer, the pressure for resellers to discover their “value add” grows even more severe.
The days of simply reselling technology products to make a living are quickly coming to an end. There isn’t enough profit margin available to eek out a living just selling hardware and software, and it takes a large volume of subscribing customers to reach any significant revenue level by reselling commoditized cloud services. Yet the customers are there to be won if the offerings represent solutions to defined and recognized business problems – solutions that introduce quantifiable business benefit rather than creating more business problems – and where the reseller plays an integral part in making the selection a successful one for the customer.
While it may seem that business cloud computing, hosting services and SaaS solutions all come with easy-to-read instructions, do-it-yourself installation and painless upkeep, the truth is often very different. Some consumers realize this when they go shopping for solutions and come up with more questions than answers; some only figure it out after they have made the wrong decision. Either way, these businesses could use the help of a professional who will provide the added value of taking time to understand the problem to be solved, consider the variables which exist in the client organization, and clear a path which takes the customer business to a better place.
Cloud computing and SaaS may be changing HOW businesses purchase and use technology, but it is not changing WHY they do it. Businesses buy IT because they think it will solve a problem – they have expectations. The reseller can find and provide the added value: the reasoning (meeting expectation) for selecting the solution, why it is the right choice for the customer organization, and how they will ensure that the solution delivers the benefits described and expected.
Read more about Helping a Small Business Customer Choose Your Solution