From The Editor | September 18, 2014

Lively Media Panel Opens VARTECH 2014

jim roddy

By Jim Roddy, VP of Marketing, RSPA

VARTECH 2014 Panel

Value-added distributor BlueStar turned the tables on members of the channel media at its VARTECH conference in New Orleans Thursday. The day one general session opened with BlueStar Global Marketing Manager Dean Reverman asking publishing executives and editors questions about trends and best practices for solutions providers and IT vendors.

I was honored to be part of the panel but was also a little unnerved being in the hot seat for a change. Fortunately, Business Solutions frequently connects with successful solution providers, vendors, and distributors, so all I needed to do was share their perspective with the hundreds of VARTECHers in attendance.

Here are some of the questions and answers related to this session I thought you would find most valuable:

What are successful solution providers doing right now that I can adopt to give my business a lift in 2014-15?

  • Transitioning their businesses to the as-a-Service business model, adding mobile POS, and integrating payment processing. A great example of this is BlueStar reseller All Florida POS (featured in the June 2014 issue of BSM). By selling iPad POS as-a-Service, the solutions provider is earning monthly residuals on its iPad sales and achieving a 100 percent sales growth rate this year.
  • Providing total solutions in healthcare. An example of this is BlueStar reseller Alpha Systems in Virginia (featured in BSM in May 2014). Alpha’s roots are in bar coding and warehousing, but the company now provides labeling and scanning solutions for pharmacies, laboratories, and hospitals. These moves enabled Alpha to jump to approximately $7.5M in 2014 revenue.
  • If those first two suggestions are too grandiose for your business, you can look for cheap installs that will fail (e.g., consumer devices in the wrong application). ECR Systems in Dallas, a BlueStar reseller focusing on retail IT and featured in BSM in July 2014, is doing just that. Key to succeeding with this tactic is making sure you fully understand the needs of the customer so you provide the right solution … or else another solution provider will be replacing your failed install soon.

What’s around the corner?  What emerging areas do I need to master ASAP to provide more value to my customers?

  • Mobility in all verticals. Nobody is predicting that technology will become more tethered in the future.
  • The healthcare vertical presents plenty of opportunity for capable resellers. Be warned this is not a vertical that is entered easily or quickly.
  • Customer experience in the retail vertical. Most retail VARs have focused only on efficiency or business processes, but they should be suggesting to their SMB clients how to enhance each customer’s experience through technology. Key topics are digital signage, online integration, and tableside payments.

What actions do I need to take over the next 18 months to stay relevant and thriving in 5 years?

  • Shift some customers to the recurring revenue/as-a-Service business model. The question resellers in the data collection and retail IT space have about recurring revenue is, “How do I get there?” First, you don’t have to convert all your customers all at once. Find current or new customers who would prefer to pay monthly, and begin working with them in this manner. The typical transition to a mostly recurring revenue business model takes 5-7 years, but VARs need to start taking steps now. Another important step is building the right staff. Your salespeople and techs need to fit the services mindset. Salespeople need to have the ability to uncover all the client’s problems and talk outcomes, not just pitch products and ramble on about speeds and feeds. Techs need to be proactive, genuinely care about customers, and have the personality to effectively engage with customers. Also, VARs need to find the right partners, especially in terms of financing. For years BlueStar and other distributors have offered a variety of financing plans for resellers. POS and AIDC vendors are starting to help with the as-a-Service transition as well. At RetailNOW in August, APG and Datacap announced a mobile POS system that can be sold as-a-Service, Epson discussed as-a-Service offerings as well, and HP is also moving down this path.
  • Another important action is to be sure you are selling the total solution. As BlueStar VP Mark Fraker once stated during a RetailNOW meeting, VARs need to focus on all the technologies inside a restaurant or retailer, not just the hardware stack 20 feet from the front door.

What value-adds do you hear VARs requesting more frequently from the vendor community?

In BSM’s 2014 Best Channel Vendor survey, the only vendors who received high marks in the category of Adequate Margins were RMM (remote monitoring and management) vendors. Value-adds are great, but what a solutions provider truly wants is the ability to make a lot of money and run a sustainable, growing business. The Best Channel Vendor survey also revealed low scores in the Channel Program category. The media didn’t have one-size-fits-all answer to what resellers want. Vendors need to go on a “listening campaign” to get a full understanding of specifically what aspects of their channel program are working and what parts need shored up.

Panelists for this session included John Stewart of Digital Transactions, Abby Lorden of Vertical Systems Reseller, Jenease Sorondo of Global IT, Julian Lee of ECN, and yours truly representing Business Solutions.

VARTECH 2014 is being held Sept. 18-20 in New Orleans at the Hyatt Regency and the Superdome. VARTECH, the annual conference for value-added distributor BlueStar partners, focuses on data collection, point of sale, mobility, digital signage, RFID, and security. For more information on BlueStar and VARTECH, go to www.BSMinfo.com/solution/InsideBlueStar.