U.S. VARs Tap Overseas Markets

U.S.-based solution providers are tapping a hot, new emerging market: the world. In growing numbers, domestic solution providers are discovering that their technical and business acumen translates well into foreign markets and are rapidly moving to establish global footprints.

"You have to look at the global market," said Warren Mills, vice president of sales and marketing at Camisa Technologies, a $3 million, Tempe, Ariz.-based solution provider. "A VAR sooner or later takes the application or vertical he is most comfortable with and takes everything out of his market that is available. He may have a great solution, but there are only so many customers in his area he can sell it to. And then he has to find new areas, and that might as well be global."

That's the sentiment spreading through a U.S. solution provider community hungry for growth.

"There is a whole, new untapped market that lies out there," said Bruce Geier, president and CEO of Technology Integration Group (TIG), a $300 million, San Diego-based solution provider. TIG purchased a German solution provider early this year to serve the European and North African markets, and it's exploring partnering with Latin American solution providers to establish a presence in Central and South America.

"The local solution provider gives us feet on the street, local knowledge and he overcomes the language barrier," Geier said. "We give technical insights and skill sets, and we can fly people into Latin America a whole lot easier than Europe. There's a huge upside to this."

Mills agreed that a local partnership is key to going global. Slightly more than a year ago, Camisa struck a deal with the Sonora state government in Mexico to hire Mexican software engineering graduates from local universities in Hermosillo to do CRM and ERP development work. Early next year, Camisa plans to spin off its Mexican operations into a separate business unit called Tiempo.

Camisa will use Tiempo engineers in Mexico to do custom development work for government and large corporate accounts in the western United States and sell application and data migration outsourcing services to other VARs nationally. "There's no reason that, if we're successful, we can't have development operations similar to Mexico in different parts of the world," he said.

Mills cited Russia and Eastern Europe as places where there is a lot of local engineering talent but a shortage of in-country job opportunities for highly skilled people. He said U.S. solution providers could provide sales and marketing expertise and use local developers to solve business problems.

NEXT: VARs taking the overseas plunge.