By Ray Jenne, EVP of operations, Jenne, Inc.
In an economy that can be both uncertain and uncooperative, the most reliable formula resellers can follow is to pursue labor-efficient, high-margin revenues. This has direct relevance to one area in particular: service contracts. Recurring services typically offer greater profit opportunities than many commoditized hardware solutions — and once in place, they can bear predictable income with relatively little upkeep.
Furthermore, recurring services provide an opportunity for VARs to open and maintain an ongoing dialog with clientele who might otherwise not be inclined to interact on a regular basis. Services renewals can also open up opportunities to upsell additional solutions or new "phases" of prior infrastructure projects. And as the manager of an ongoing service level agreement (SLA), that reseller is positioned to become a longterm outsourced IT advisor: a valued role that can lead to repeat sales and lasting relationships.