What Is a VAR? Your Questions, Answered
Are you looking to start an IT business? Unless you’re the best Steve Jobs or Mark Zuckerberg, you can probably forget about starting a new product that will make you rich.
But, you don’t have to create something entirely new to start a great business in IT.
If you can reimagine and repackage existing products in a useful and creative way, you should look into becoming a VAR. What is a VAR? It stands for value-added reseller, and it is a great, legitimate way to start a business. Keep reading for more details!
What Is A VAR?
Simply put a VAR refers to a person or group that adds to the value of existing products and then sells them to the customer. They don’t actually manufacture or create products themselves, but instead take existing products and package them in a more creative way.
This is especially common in the software and IT sector. A company may decide to sell a certain laptop that comes equipped with software specifically useful for graphic designers. Or construction companies. Or work-at-home accountants.
You’ll purchase the laptops in bulk, purchased software for each one, and are now selling it together as one unit. You’ve added value to potential customers since they won’t have to seek out the hardware and software.
You don’t necessarily have to stick with one brand, though some VARs do so. It might make sense to offer customers a few different options and brands depending on what they are looking for. Customization and specialization are the keys.
Advantages of VAR System
The clear advantage for customers when they buy from a value-added reseller is that the reseller has done some of the legwork for them. They’ve created a useful package or set of features that a customer wants.
They can also shop in just one place instead of having to go to multiple places and deal with multiple companies. The convenience factor is important, and it is why this type of business can exist.
The advantage for a new business owner is that you do not have to worry about creating a product from scratch. Apple or Microsoft or Bose or any number of companies already have done the really hard part.
VAR works particularly well for software. Business owners can search out good ERP leads to get some ideas. Even now, as things are a little up in the air in the world economy, experts still recommend the VAR business model.
Disadvantages of VAR
The disadvantage for a business owner is that they won’t have any control over the price of the products they’re adding value to. This can make it a little more complicated to plan for the future.
They also don’t have much say in what features the products themselves will come with. They may have to be creative with their marketing and bundling to come up with an attractive product for consumers.
On the consumer end, there is likely a little less transparency about the products when they’re being sold by a VAR.
Add Value To Earn Some Money
What is a VAR? It’s a great business move, and the advantages outweigh the disadvantages by a long shot. If you are looking for a way to create new business in IT, consider becoming a VAR.
Get out there and create some value for customers! Check back here for more great business articles.
