The tech community loves to throw around acronyms more than most. Two of the acronyms that may confuse discerning hardware and software purchasers are the terms are VAR and VAD. These stand for Value Added Reseller and Value Added Distributor, respectively.

This blog aims to shed some light on the closely related, sometimes overlapping, tech partnerships your organization may enter into.   

A Brief Breakdown of Terms

Defining these terms in such a fundamental way might seem a little basic, but the difference between engaging a reseller vs distributor is so subtle that they are often used interchangeably. However, choosing one over the other can afford big opportunities for your organization, depending on the particular one you choose.  

The Meaning of Distributor

Classically, a distributor tends to work closest with original equipment manufacturers of a product. In the sales process, distributors buy directly from a manufacturer, will hold inventory and resell those products to resellers and sometimes even end-users. 

In general, distributors typically offer product marketing, and spend time developing sales team representatives that know the products inside and out. They tend to be focused on profit margins, with some types of distributors offering drop-shipping or pack and ship services to a variety of outlets as an added value. But more on that later. 

The Meaning of Reseller

Resellers may buy from the manufacturer, but often buy from distributors.This puts them slightly lower on the distribution channel, but for tactical reasons. Because resellers are less focused on pushing sales, they do not usually keep vast, unclaimed inventories. 

Resellers tend to be more focused on developing end-user relationships than on getting specific products out the door. While the idea is still to make a profit, they gravitate towards providing excellent end-user customer service. 

Resellers may sell a variety of products from different distributors or manufacturers, so that their customers have options available and can choose the best solution to meet their needs.

The Meaning of Value Added

According to Gartner.com, Value adding activities are: 

“…those activities within a company or supply chain that directly contribute to satisfying end consumers, or those activities consumers would be happy to pay for.”

Value Added Resellers vs Value Added Distributors

Value Added Distributors 

VADs tend to be focused on adding value to customers by increasing the value of the products themselves. This can be done several ways.

A VAD might provide additional value to their customers by offering: 

• Large inventories
• Drop-shipping to end-users
• Sales support and market knowledge
• Manufacturer certified technical support services 
• Professional services and training
• Credit agreements

Value Added Resellers

VARs tend to have a slightly different business model from VADs. Value added resellers satisfy consumers by providing added products and personalized services like:

• Complete System Assessments 
• Implementation Expertise
• Testing and Technical Support
• Insights on Productivity and Workflow
• Logistics and Shipping
• System Packages and Bundled Services
• Flexibility in Pricing and Sourcing
• Dedicated Account Management
• Tailored Trainings

Added Insight

Working with a VAR to purchase software and hardware can give your company added insight. While they still aim to sell the product, it may not be the only or best solution they sell that can solve your particular challenge. 

VAR partners are invested in providing unbiased opinions on the products and services they offer because they thrive on your company’s success and continued use of their specialized services. VARs often have more options available and may even furnish your company with financial analysis showing the projected return on investment of the products you’re considering.

With Quadbridge, you get all this and more. When you sign up, we assign you a dedicated account manager. We offer competitive pricing with flexible financing options, and our services cover both sides of the border.

Help with Implementation 

Technology vendors and distributors do not always know the best methods of implementing the products they sell, especially in particular industries or when paired with existing programming. Value added resellers may offer business-specific guidance during product implementations. Resellers who have sold to similar companies in similar industries bring value in the form of expertise.

Customization

VARs often offer customized products or services that touch on every aspect of software and systems planning and implementation. VARs tend to spend more time getting to know your particular organization. The ability to pair this insider view with their established know-how saves time, money and can help better leverage your investment. 

To speak with a top value added reseller of technology like Microsoft, Lenovo, Dell, HP, Cisco and unique services that help with remote workforce logistics, contact Quadbridge today!