Everything you need to know about VARs for IT equipment Procurement

TL;DR

• Value-added resellers are channel partners or service providers who empower IT teams to customize software and hardware products, extending the functionality of original products.

• IT teams need VAR to deal with multiple vendors, provide expert guidance, technical support, post-sale service, resource optimization, and more.

• VARs enable the deployment of bundled solutions, reducing the total cost of ownership, enhancing support and scalability, and helping beyond the point of sale.

• Working with VARs presents business challenges such as vendor lock-in, complexity in management, conflict resolution, and licensing glitches.

• VARs source essential products from OEMs (Original equipment manufacturers), integrate them into their products, and brand them under their names.

What is a Value-Added Reseller (VAR)?

Source

Value-added resellers (VARs) are companies that add features to existing products and resell them as integrated products or complete solutions. Far from being merely middlemen, VARs' scope of service offerings includes customizing software and hardware products to meet customers' needs. They provide comprehensive knowledge, expertise, and value beyond the primary product offerings.

VARs are also channel partners for IT acquisition between IT teams and vendors.

Here's what typically defines a VAR:

Procurement service

Workforce spread globally? Need to deliver devices to different geographies?

Well, we know how frustrating that could be!

Enter VARs—globally located VARs can be promising for procuring devices in different countries. They remove export and customs fees and deliver devices, peripherals, and furniture internationally (from their or a partnered local warehouse).

Customization of hardware and software

According to a report by Statista, the software market will reach $659 billion in 2023 and is expected to grow beyond that in further years.

This implies that independent software providers will also be on the rise.

VAR partnerships with these independent software vendors can (and have been) work miraculously to team up for your customized needs.

They offer software customization capabilities and integrate third-party add-ons via additional hardware and software to enhance functionality.

Implementation process

Are your employees stumped at their dim workstations, sitting with a new computer and wondering how to set it up and make it work-ready?

Well, it’s good you partnered with VARs!

VARs play a crucial role in device implementation. This includes setup, configuration, and installation services to help you successfully deploy and use software, hardware, or integrated solutions. Their in-depth knowledge of specific value-added products and industries makes them valuable partners for companies like yours seeking tailored services.

Technical support

Technical support can be a total headache for employees if not delivered correctly!

You are jumping from software to software, application to application, trying to acclimate to how to use them, or just recovering them since they crashed!

VARs come to your rescue! They offer ongoing technical support and value-added services to new users or clients. The partners also walk you through IT assets, assisting you in staying illuminated on usage or fallout scenarios.

Post-sales services

Service and support are the heart of successful business objectives.

This includes many factors: troubleshooting, training, reseller programs from educational institutions, and maintenance and repair services. VARs help with these and often provide customization services, even post-delivery (sometimes at negotiated prices).

Why do IT teams need VARs?

VARs are known for intimate knowledge and the ability to offer flexible value-added solutions to customers for enhanced business performance.

Due to the rapidly growing business landscape of the customization market, VARs are buzzing the IT ecosystem. Teams now are more aware of precisely what they want but are looking for how to get it.

Consequently, VARs are loved, adopted, and growing unprecedentedly in the IT market. They were valued at $549 million in 2023 and are projected to reach $1376.28 million by 2031 at a 12% CAGR.

This awakens buyers and sellers to look for ways to stay enlightened.

Here are a couple of factors to explain how VARs empower IT teams:

Expert Guidance

VARs offer expertise that standard equipment resellers typically do not.

They understand the business processes and various product specifications and can recommend the best configurations and solutions for a particular use case. Since they dabble in product technology with an extensive portfolio, they also apprise IT teams to make decisions for meeting revenue targets.

Time Efficiency

One key advantage of VARs is that they handle the complexities of equipment sourcing, configuration, and integration. They play a crucial role in IT teams for primary tasks, strengthening security solutions and strategic planning, and saving valuable response times.

Resource Optimization

With VARs, you do not have to shuttle between vendors and employees. VARs enable you to focus on core IT tasks while they concentrate on vendor communication. With proper resource optimization, you have a clean cut - no more overutilization or underutilization.

Adopting Latest Technology

Since VARs are niche-focused, one of their numerous benefits is helping IT teams stay up-to-date with emerging technologies. This increases the IT team’s productivity, whether implementing resource planning systems or upgrading technology infrastructure.

Holistic Solutions

VARs partner with multiple vendors and offer customized solutions that give your company a competitive edge and are unique to your company. When partnering with a single vendor, these options might not be accessible. This enables you to make informed decisions and choose cost-effectively.

Compliance and Security

VARs ensure that all hardware and software they promote meet advancements in technology industry guidelines and regulations. These regulatory frameworks include HIPAA, GDPR, ISO/IEC 27001, WEEE, PCI DSS, and more.

Do you know how hefty it would be if you lost your employees’ data—their SSNs, Credit Card details, addresses, phone numbers, and whatnot? Thus, VARs keep all these compliance standards in check, ensuring you do not experience this headache.

Recommendation: You should check out this blog on LinkedIn that educates you on the gravity of compliance rules.

Streamline Procurement

Value-added reseller partners streamline the procurement process of IT assets by negotiating with multiple vendors and ensuring timely deliveries. This relieves you from dabbling into redundant conversations with vendors.

Single Point-of-Contact

VAR as your single point of contact frees you from stressful negotiations, empowering you to focus on other pivotal tasks, like expanding your business.

What are the benefits of Using VARs?

Now that you know why your company needs VARs, let's emphasize their other numerous benefits. These add to VARs' key advantages, which help improve return on investment (ROI).

Bundled Solutions

VARs often provide bundled solutions that include hardware, software, installation, initial configuration, and maintenance. This "one-stop shop" approach streamlines procurement and deployment processes.

The requirement for customized solutions stems from the need for turnkey and comprehensive solutions that are ready to use and chosen from its extensive portfolio.

Workwize ensures that you have a ready-to-use product deployed right at your or your office’s doorstep. No more banging your head on the wall trying to complete the installation.

Reduced Total Cost of Ownership (TCO)

Optimizing equipment to fit operational efficiency can lower the overall cost of ownership. With bulk purchasing options, VARs lower upfront costs, ensuring businesses benefit from comprehensive, cost-effective technology implementations.

Also, VARs often offer extended warranties that cover repairs, replacements, and sometimes even upgrades. This, in turn, protects the business from unforeseen expenses related to equipment failures and proactive maintenance services. Not only does it reduce TCO, but it also impacts return on investment (ROI).

Enhanced Support

VARs typically offer ongoing support, crucial in troubleshooting and performing complex upgrades or migrations.

With almost 20% of all B2B sales and support expected to be handled digitally from 2023, you must ensure you’re well-equipped. If not, be prepared to outsource to VARs who are fluent in negotiations.

Scalability

VARs can help scale infrastructure smoothly by anticipating growth potential and adjusting recommendations and configurations accordingly.

For instance, you can start with a computer with only 5 GB RAM. However, as the device ages, you realize you need 16 GB RAM to amp up the speed, as the system has begun to slow down. This is fulfilled by the VARs, who help upscale the hardware.

Robust Marketing Tools

VARs enhance customer relationships by offering favorite features and tailoring the product to their needs. This custom product increases desirability among customers and distinguishes it with a competitive advantage. VARs also take ownership of marketing and thus promote the assets in your brand’s name.

Beyond Point of Sale

Value-added services extend beyond point of sale to meet business objectives. They enable business models to purchase compatible technological infrastructure items, plan for renewals and replacements, and budget.

Subject Matter Experts

VARs help clients upgrade to better technology infrastructure when the time comes, imparting knowledge of their target market. This expertise in the niche plays a crucial role; VARs often combine value-added products from different vendors to create a comprehensive solution.

They often act as consultants, advising businesses on best practices, future technology trends, and meeting strategic goals for digital transformation.

What are the challenges in dealing with VARs?

Here are some business challenges that surface while associating with VARs:

Potential for Higher Costs

The customization and additional services VARs provide come at a price—there may be significant markups on the base equipment costs. This implies that even though the VARs may offer impeccable services, the price could make you reconsider them. 

The comprehensive range of growth potential VARs offer is another factor you may want to address when choosing.

Vendor Lock-in

Engaging with a single VAR might lead to dependency and reduced flexibility in choosing alternative suppliers or solutions in the future. If this relationship is elongated for an excessively long time, it can freeze you with one VAR.

This does not question whether VARs are reliable or not. It’s just that you must be open to being educated on other potential value-added reseller partners. In dire scenarios like abrupt contract terminations, you must not be directionless.

Delayed Updates

Although VARs provide updates and support, delays in administering the latest updates and technologies compared to direct vendors can sometimes be an issue. This could be due to the extensive development of features from the vendor’s end or even lengthened response times.

Complexity in Management

Working with VARs adds another layer of complexity as it involves coordination beyond the traditional hardware procurement channels.

Continued Education

A VAR must be updated on new trends and technologies to successfully deliver state-of-the-art services. Not offering cutting-edge technology can lead to low-margin profits.

Essential Channel Program

Pursuing indirect sales via VAR necessitates a structured channel program for operational efficiency.  Channel partners use sales and marketing strategies to nurture and guide prospects through sales journey, which might be cumbersome otherwise.

Conflict Resolution Mechanism

Managing beneficial relationships with technology vendors requires effective communication to resolve conflicts and align with expectations and strategies. This dual focus on transparent communication and conflict resolution is imperative for sustaining successful and mutually beneficial VAR partnerships.

Licensing complexity

VARs partner with vendors that license different software or hardware assets. Thus, they must align neatly to ensure they offer their customers the right licenses.

What is an Original Equipment Manufacturer (OEM)?

All manufactured products, such as computers, PCs, mouse, peripherals, or other assets, are assembled using parts from OEMs.

In simple terms, OEM manufactures company goods for B2B businesses that are that are used as components for another company's products. They work with VARs on supply chain management, ensuring that required items are met.

For example, the laptop you use to design your graphics comprises a hard disk. Your laptop company buys this hard disk from the OEM, integrates it into the final product, and sells it rebranded as a new product (the laptop). Thus, OEM anonymously becomes an integral part of the tailored solutions for businesses.

VARs vs. OEMs: Key Differences

 While VARs and OEMs are two distinct entities, they are often confused. Here is a little discussion on their precise roles.

Why Workwize is Better: Automated IT Hardware Lifecycle Management

Workwize is a fully automated hardware asset lifecycle management platform that monitors IT devices from procurement to disposal. It is a better choice when compared to VARs and OEMs because:

• Entirely automated platform that handles all stages of IT hardware management.

• Spread globally across 150+ countries, so beats VARs focusing only on their local geography.

• Manages all leased and bought IT devices centrally, which is quite fragmented in case of VARs as they do not have a centralized system.

• As the device reaches its useful life, Workwize retrieves it with a zero-touch policy. This includes handling all logistics, packaging, compliance issues, and data erasure certifications.

• Reduces TCO; VARs may aim for the same, but their dispersed approach doesn’t yield consistent savings.

With Workwize, you can:

Procure IT Hardware: Procure your IT devices in 150+ countries within days, including devices like phones and tablets, to warehouses, remote offices, or directly to employees' homes.

Deploy seamlessly: Ensure MDM-enabled devices watch over your devices for secure and efficient usage.

Manage all your devices: Monitor all leased or purchased equipment, track its depreciation over time, and facilitate self-service IT support for equipment repairs or other service requests.

Retrieve painlessly: Enjoy zero-touch retrieval as IT devices reach the end of their life. Leave all communication, packaging, and logistics to us.

Dispose of with compliance: Get fair market value for your end-of-life hardware through local warehouses or donate with certificates of data erasure.

Book a Workwize Demo Now for a quick walkthrough of how it can be your go-to partner for hardware lifecycle management!