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The Impact of the Cloud for Value-Added Resellers
It comes as no surprise to today’s value-added reseller (VAR) community that there is a changing of the guard in the way technology solutions are being purchased and consumed by customers. A fundamental market shift toward the Software-as-a-Service (SaaS) model has rapidly and dramatically changed the way technology applications and platforms are now delivered to businesses.
As a growing number of VARs add SaaS offerings to their solutions portfolio, those not providing cloud-based services will find it increasingly difficult to compete for customers and maintain healthy profitability. Those resellers who provide their customers with a full portfolio of both on-premises and cloud-based solutions and services will be best positioned to enjoy the greatest measure of growth and stability. Just some of the key advantages of a cloud-based delivery model for resellers include:
- Earning recurring revenues over the length of the customer relationship lifespan, rather than just a one-time margin and a small amount of maintenance revenue
- Extending the lifetime value of a customer by increasing the “stickiness” of services provided
- More efficient implementations than with premises-based solutions—fewer resources are needed to install and virtually no resources are needed to upgrade
- Differentiation from competitors—quickly and cost-effectively expand services offerings and be better equipped to address a more complete range of business requirements