IT and Business Insights for SMB Solution Providers

Partnering in the Cloud: Broker a New Opportunity

Cloud broker/aggregators enable VARs to offer cloud services, while filling any knowledge gaps and providing training, certification, and sales and marketing support. By Jeff Davis

Selling cloud-based solutions in the SMB marketplace requires a varied list of capabilities. Resellers need enough expertise and acumen to make their small business customers comfortable with the still somewhat novel concept of hosted data and an off-site infrastructure - and with the VAR's own prowess as a provider of same.

Beyond their initial education on this new paradigm, VARs will need an arsenal of skills that include negotiating separate vendor agreements, assembling multivendor technologies into a single solution, deploying virtual servers and data centers, developing collateral and marketing strategies, managing multiple billing platforms, and more. This is simply prohibitive for many independent resellers.

Yet VARs don't necessarily have to build a cloud offering independently. Entities called “cloud brokerages” or “cloud aggregators” have emerged in the market, offering an integrated platform of training, certification, hosted solutions, billing options, and sales and marketing support. Such brokers are designed to fill any knowledge or services gaps that the individual reseller cannot provide, allowing smaller VARs to take advantage of the cloud opportunity where they may not have been able to before.

If you decide to go with a cloud broker/aggregator, it's important to select a partner with a trusted name - one you know will be viable in the long term. In a new category such as cloud, there will be a good number of “tire kickers,” or companies that test the waters and after limited success decide not to add this discipline to their core competency list. So stick with an established entity that has a vested interest in providing hosted infrastructures.

Make sure that company offers a suite of features that support your specific business model as well. Training should be flexible enough to move at your company's pace, as opposed to using a cookie-cutter approach. In addition, your partner will be of greater value if the company can deliver an ongoing regimen of support throughout the sales process, including marketing materials and sales strategies to help you communicate the value of a hosted infrastructure to your small office clients.

One of the advantages of the aggregator concept is that, ideally, cloud services can be consolidated into a unified offering that's both intuitive and accessible. For example, a portal-based system enables resellers 24/7 access to services and administration of their accounts.

Also, make sure the platform you commit to is easy to use and the provider allows you to brand the service offering as your own. The point, after all, is to grow your business. The more brand awareness you can create though your partner's offering, the more useful it will be in establishing yourself as an authority in an emerging space.

Even if you can provide all of these capabilities independently, depending strictly on your own wherewithal in such a complex category may lead to reduced margins in the end. An effective cloud broker negotiates services with multiple companies simultaneously and can deliver economies of scale to preserve overall profits on each deal.

The value of a cloud partner comes in the expertise and combined array of proven services that you, the reseller, can leverage - without draining your internal resources.

JEFF DAVIS is senior vice president of sales for IT and electronics distributor D&H Distributing Co., based in Harrisburg, Pa.

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