IMGCAP(1)]Today’s value-added resellers know they must keep up with market trends associated with the software they sell so they can provide implementation and service for the software, but is that all there is to their business? In today’s ultra-competitive market where every vendor wants a larger piece of the pie, providing software without any other service may not be enough.
To grow revenues and keep customers from going elsewhere, more VARs are adding additional lines of business. These lines often complement the software already being sold while, in other cases, they are completely separate efforts.
If you’re a VAR reading this, I do not think for one moment that your business will stagnate just because you have not branched out of your current offerings; I can’t begin to judge how any other company runs its business. Yet, based on our own sales, and from talking with hundreds of business partners, including VARs and accountants across the country, it’s obvious customers and clients want something more, especially from someone like you whom they trust.
SWK Technologies in Livingston, New Jersey, has continuously built a successful business by looking beyond its current offerings. Jeff Roth heads up a team that primarily sells, and consults on various Sage Software applications, but also offers its own MAPADOC electronic data interchange (EDI) software, integration between Sage ERP 100 and Accellos’ warehouse management solution (WMS), among many other solutions.
I was drawn to SWK because of one of its still-new businesses, BeerRun, was created after SWK completed two sales opportunities of Sage ERP X3 to well-known, large craft brewers. The emphasis here is on “opportunity.” Roth saw an opportunity and capitalized on it.
“As we worked with those customers and got to know the craft brewing industry, we realized that there were no brewery management applications for entry-level to mid-sized companies,” said Roth. “We created a cloud-based application that could sit on top of any accounting software and help run any brewery.”
Another example from SWK is HRAdvisor, a business created based on SWK customers asking for human resources support and services. However, more than generating new business, Roth says HRAdvisor is seen by SWK as a customer retention tool.
“Like SWK, other VARs can add customer stickiness with additional services,” he says. “VARs do not have to be experts—just the principal point of contact; gaining expertise in a particular industry or vertical can lead to more opportunities and sales.”
Although it’s not new for accounting firms to add technology practices that sell software, I have talked with a few firms that have eliminated their IT practices for various reasons. The market may dry up for them, attention gets placed elsewhere, or the firm partner in charge of the IT practice moves on to a better opportunity. However, I’ve also met some very engaging VARs who are doing this with great success, including RKL eSolutions based in Lancaster, Pennsylvania.
Headed by Joe Noll, RKL eSolutions also focuses on Sage to provide network/IT support, custom development and consulting solutions, while also cross-selling to clients at RKL. Referrals are often made back and forth between companies.
“Client needs change and we need to adapt to these changes,” says Noll. “We take pride in being able to provide a diversified set of skills, as well as strategically selected solutions and services to meet our clients’ changing business requirements. These solutions have proven to be complementary to our relationships and expertise.”
Whether your business is totally IT focused or part of a larger accounting firm, finding a way to expand offerings might seem as if it’s a monumental challenge. I think it boils down to finding a way to find new clients or customers, while keeping the ones you have. I asked Roth and Noll for advice they would give other VARs who want to expand.
“They need to be willing to research various offerings and extend their team expertise to obtain an in-depth understanding of selected add-ons to compliment what they do, as well as what their clients need, today and into the future,” said Noll.
“VARs first need to find a specific sector where they either have significant expertise or a large concentration of customers,” said Roth. “Then, they need to see how they can differentiate themselves in that space while continuing to develop more resources and knowledge to support what hopefully is an increasing number of clients.”
I couldn’t agree more. The next big thing for VARs may, indeed, be a new release of the software it sells or perhaps a related mobile application, but unless VARs can expand their offerings with additional ways of doing business, they may find customers going elsewhere to get those services. Ask your customers what it is they want from you that they aren’t currently getting; you may be surprised at the responses and, in turn, can identify additional opportunities.
Pascal Van Dooren is chief revenue officer at Avalara. He can be contacted at
