What is a Value-Added Reseller (VAR)?
August 4, 2023
The remote and hybrid models of working initially imposed by the pandemic are here to stay. Gartner surveyed HR leaders and found that 66% indicated their organizations have a hybrid work model, and 30% are planning to adopt one—and yes, these numbers are from 2023. An analysis compiled by Forbes Advisor narrates the employee preference for remote work; 32% of hybrid workers would “take a pay cut” to work remotely full time, and 65% want to work remotely “all of the time”.
So, with the workforce staying distributed, organizations must re-evaluate their current and potential partnerships to see if they can keep up with the required shift in IT operations and IT supply chains. Particularly, having to equip workers wherever they are located while managing the lifecycle of each device end-to-end (initial deployment, repairs, updates, refreshes, retrievals, redeployment, and end-of-life decommissioning).
In the article “What is a Managed Service Provider (MSP)?”, we broke down the advantages and limitations of partnering with MSPs to outsource device lifecycle management. Let’s apply the same lens to the professional services of value-added resellers (VARs).
Benefits of the VAR Business Model
Value-added resellers are an important portion of the larger IT industry. VARs add features or services that provide extra benefits beyond the original order. Usually part of a larger sales channel for an original equipment manufacturer (OEM), VARs customize and package third-party products to resell them to end-users as bundled offerings.
A VAR is a great channel partner to rely on when you need someone to act as the middleman in the acquisition and implementation of technology solution add-ons. While a traditional reseller sells another vendor’s product “as is” to your organization, a value-added reseller business model provides technical support enhancements. Let’s use Microsoft 365 as an example. Microsoft is the vendor, but companies can rely on VARs to install and subsequently train end-users on 365.
Each VAR has its own established relationships and expertise to offer recommendations to strapped in-house IT teams. Ultimately, they are leveraged to save on costs and time through:
• Vetted Options & Assessments: VARs typically represent multiple OEMs (e.g., HP, Lenovo, Apple, Dell, Microsoft, etc.), having taken the time to develop strong relationships and fully learn about each manufacturer's compatibilities and features
• Purchasing Power: In-bulk purchases make the cost per unit of assets cheaper. To stay ahead, many VARs are competitive in price, benefiting your organization’s bottom line
• Installation Services: They don’t just source the components! Value-added services include setup and installation of both hardware and apps/software systems (e.g., Cisco, IBM) and subsequent training
• Single Point of Contact: Evaluating the best IT products that provide additional value for your employees is time-consuming, especially when small and medium-sized businesses (SMBs) may only have a few people sitting in the IT org. A value-added reseller can act as a single point of contact between multiple IT vendors, streamlining management and troubleshooting considerably
• Enhanced Troubleshooting: Your outsourced VAR team is typically expected to have the latest technical certifications from the OEMs they represent
Capabilities to Assess When Choosing Your Value-Added Reseller (VAR)
Here’s what you need to consider when assessing a VAR partner in regards to supporting a managed device lifecycle today’s more-distributed workforce.
Global Device Procurement
Procurement of devices is the most common use case that business partner with VARs for. It is what they are good at and have expertise in. However, it is common that their expertise is divided depending on each entity. For example, the same VAR will have one entity in the US and a different one in Canada. They both are technically the same company, but they often do not work together.
As such, companies using a VAR to procure their necessary employee equipment will often have multiple VARs they have to maintain relationships with in order to support the various geographies their employees are located in. This makes it very frustrating (or even impossible) for organizations looking to expand their talent pool internationally. To not have to pay steep export and customs fees, your organization will have to walk the difficult path of trying to figure out a VAR for every country you would like to have employees.
Depending on their maturity, some VARs may also be limited in what they sell—for example, your business may prefer using the iWork productivity suite by Apple, but a particular VAR may only sell Lenovos and Dells and not Macs. For smaller organizations, this is probably fine, but if your IT org wants to provide end-user employees with a flexible catalog of options, you need to be aware of the variety of third-party products offered.
VARs can help with procuring peripherals (aka any external device accessories) as well. This means that IT teams are relieved of managing the sourcing and logistics of these items themselves, ad hoc. When multiple requests for keyboards come in—some with different alphabets depending on your workforce’s footprint—the picking, packing, and shipping of these peripherals gets time-consuming, so this is a weight off of your IT’s teams shoulders.
In the same way there might be OEM limitations for regular devices like laptops and monitors, there might be limited options for your catalog of peripherals.
Furniture is rarely offered by VARs. After all, when workers were in an office, this was not something organizations needed help with, and the VAR business model never had to support. With remote work, however, there is an increased need to make sure the “home office” has a dedicated desk and ergonomic chair on top of a laptop and monitor; for both productivity and comfort.
Employee Self-Service Interface
If you would like to give your employees more options while still following your IT team’s cybersecurity protocols, then offering a self-service portal for employees to pick their preferred devices and request peripherals as needed is the way to go. Unfortunately, VARs do not always offer this kind of interface. Some VARs can provide a portal for their specific devices, while others require a more manual approach (emailing order requests). The capabilities are highly variable, so make sure to be aware of available options to ensure the VAR can support what you need before you agree to a partnership.
Centralized Inventory Management
The short take: Be aware that few to no VARs offer this capability.
In the vast majority of cases, getting a bird's-eye view of all your used and new inventory is not possible without manual intervention. You can pay VARs extra for a hold—and therefore, a live count—of your "new" inventory, but that’s typically about it. Caveat: Should you have it, your existing inventory (aka your legacy fleet) will not be tracked.
This is a major limitation. It’s important to know which laptop SKUs are running low across your warehouses, which devices have been returned, what requires upgrades, and where each device is across the entire supply chain (e.g., ready for redeployment, requires end-of-life destruction, in transit to a new employee, etc.). Compliance auditors are noticing that companies are not properly logging inventory counts for new, returned, and repaired devices.
Why do auditors care? One is because not knowing the location of a device (and as a result, potential business sensitive data) is a major security risk. Second, data destruction must be taken seriously; wiping corporate data, and doing so compliantly, is critical for your end-of-life devices. Devices must be retrieved, wiped, and disposed of timely and according to processes that allow for certifications to be generated and made available for audits.
As previously stated, value-added resellers can hold an inventory of their newly purchased items at a warehouse for you. However, be aware that this isn’t for free. Warehousing is an additional service line item that will come at a cost.
In the same way that VARs are geographically limited with procurement, they are also geographically limited with their warehouse mapping. If your organization wants to hold new items in strategic locations placed as close to their workers as possible, this will be a bottleneck. You’ll either need to invest in multiple VARs or separate business units of a VAR to service your various geographies individually or deal with increased shipping costs—more money out-of-pocket either way.
This service is offered by VARs, which is yet another IT project off your busy team’s plate—so much needs to happen before the device gets shipped to your employee!
Imaging refers to installing the necessary apps/software systems on a corporate device. There are two ways to image a device: Monolithic or zero-touch. Monolithic is manual, usually relying on an IT person to plug in a USB to each device. Zero-touch is done remotely and is the ideal state for managing remote and hybrid workforces.
Sometimes, organizations are unable to leverage zero-touch imaging due to industry security regulations or apps not hosted in the cloud. In this case, the tedious task of performing monolithic imaging is required.
While imaging is an offered service by most resellers, the level of customer satisfaction does tend to vary. Imaging is a very bespoke service, so assessing the VAR’s methods is important to understand the capabilities (and customer service) offered. Often-times, ill-defined processes or inflexible and bureaucratic approaches can lead to significant error rates. In some cases, when VARs can’t meet customers’ needs sufficiently, the overhead required to manage the process at arms’ length meant that some IT teams find that it would be easier to perform imaging in-house.
Onboarding (Ship to Employee)
When everyone worked in an office, onboarding an employee was as simple as handing the laptop computer to the new hire or having their monitor set up on their desk. Now that employees can work from anywhere, IT professionals now have to act like FedEx employees. Rather than shipping one bulk order to one office location, each individual asset needs to go to a different employee address. To add to the burden, these shipments are typically taking place from the IT professional’s home... giving a new meaning to the IT closet.
Not all VARs are created equal, and only some will outsource this task. That means the burden would usually be on your internal IT team to manage the shipping and logistics, which is not only a huge time sink (Psst: it takes five hours per year, per remote worker to manage logistics) but also costly. Most spend $100 annually in shipping for each remote worker. That adds up!
Repairs and Replacements
Ever violate cybersecurity protocols by using your personal laptop because your corporate loaner took over a week to come in? The job still needs to get done, after all. That’s why it’s important to get replacements and loaners out asap when workers have a hardware issue.
While VARs may offer repairs for warranties, that’s typically where they draw the line. Lacking a responsive answer to forward replacement is a major blocker to productivity, a cybersecurity and compliance risk, and does not support the device lifecycle management of distributed workforces. Someone needs to get the worker back to productivity as soon as possible. How will you. handle this if your VAR won’t cover you and your IT team is located hundreds of miles away?
VARs are programmed and incentivized to sell the original equipment manufacturer’s products and services... not take them back. From confirming home addresses and sending shipping labels and boxes to every “Did you return it yet, my UPS tracking code has not updated in weeks” email in between, your IT team could be focused on a lot more value-driving initiatives. Instead, they are stuck chasing departing employees for their laptops back.
Retrievals were easier when the last day was typically finished in the office. That employee could just leave everything on their desk. Now, getting all your necessary assets back may not happen at all. Industry analysts have shared with us that enterprise clients they speak to are getting in some cases, only half their laptops back. Ouch!
VARs rarely handle this. Cleaning and wiping an asset to ensure it is ready for its new owner is, yet again, an in-house responsibility. Your information technology team will need to re-image the device after wiping if you cannot leverage zero-touch deployment. Plus, someone will need to physically clean the device so that it doesn’t arrive in the hands of the next employee with the last employee’s ketchup stains on it.
Disposal / Recycle
We touched on the importance of proper disposal when discussing their business model’s lack of centralized inventory management. Overseeing the process of reusing, recycling, repurposing, repairing, or ultimately disposing of unwanted or “dead” IT equipment is thankfully a part of a VAR’s professional service offering.
If a manual process can be automated through integrations, most companies looking to be on the cutting edge of efficiency would opt to try it. To stay compliant, IT Asset Management (ITAM) is a key area to consider automation.
As previously stated, inventory tracking is a critical factor for security and compliance audits. Through integration to an ITAM, any changes to your devices (e.g., location, condition, etc.) can be automatically pushed instead of having to manually import data.
Alas, this process integration is not available with most VARs.
Ongoing Support Services
VARs may offer help desk services. However, understanding the status of hardware assets is often a manual relay via the VAR to the OEM, since most VARs don’t offer any unified view of assets, location, and status via a portal.
Is Relying on a Value-Added Reseller the Best Option for Outsourcing Your Remote Employee Equipment Lifecycle?
Sadly, in most cases, VARs aren’t built for the equipment lifecycle needs of a distributed workforce. The value-added services they provide may be great for the initial sourcing (particularly their purchasing power with the distributors they partner with), but it does not commonly extend beyond that. There are too many gaps in office-oriented service models to maintain adequate customer satisfaction levels for companies operating on a remote or hybrid model. VARs may, however, be the right cost-effective choice for organizations that have remained full-time in office.
The following constraints of value-added resellers can make it extremely difficult to scale your business and hire the talent you need:
• A lack of procurement flexibility
• Geographical constraint
• No employee self-service capabilities
• Limited to no integrations
• Compliance issues due to tracking limitations
• No support for your legacy fleet
To gain additional value, you could lean on an MSP to help fill in the gaps of your VAR partner. MSPs have their limitations as well, which you can learn more about here.
Thankfully, there are other solution providers out there. With Firstbase, you can enjoy all the benefits that a VAR or MSP can provide, on a global basis, while gaining the advantage of a single SaaS platform to manage the whole lifecycle in an automated fashion. Take a guided tour here.