Whose Job Is It To Help The Small VAR?

Smaller VARs, those with less than $5 million in annual revenue, are in many ways a special category. In total, they make up a very significant amount of the total dollars flowing through the channel each year. But for vendors, they are expensive to work with because the return in the amount of products they sell on an individual basis is small.

ROBERT FALETRA Can be reached at (781) 839-1202 or via e-mail at rfaletra@cmp.com.

The solution providers that comprise the VARBusiness 500 ranking, as an example, generate approximately $130 billion in sales. Vendors can easily justify chasing 500 solution providers. The smallest players on the VARBusiness 500 list generally have sales in the $25 million range.

The rest of the channel's sales dwarf those of the VARBusiness 500 companies and actually come in around $230 billion, according to CMP Channel Group research. The problem is that it's a lot harder to touch the hundreds of thousands of solution providers that make up that $230 billion than it is to work with the 500 that deliver $130 billion.

But it's this tier that is the real fabric of the industry, and it's a group that I have always had a particular interest in personally. Smaller solution providers will become more important in the future as smaller businesses acquire and attempt to manage more technology. But how do we as an industry do more for the smaller players?

In order to effectively get some payback with this group, I believe vendors first have to commit to a long-term plan, which unfortunately will be hard to justify and quantify a rapid return on. It's something that CEOs and CFOs will be skeptical about.

What makes working with this group even more challenging is that in order to be effective in touching this base, it requires working with lots of third parties. In addition to CMP, for example, it's a natural for distribution to play a role. To add another level of complexity to the discussion, that often means working with the smaller regional distributors that these VARs work with—because they can get better traction with the smaller distributors.

CMP Channel Group is the largest single touchpoint with the total solution provider community. That's why we have always served both the large and smaller solution provider. We are and will continue to expand the ways we do that beyond traditional information distribution via CRN, VARBusiness and ChannelWeb.

We already hold business training sessions like our Channel Masters program and face-to-face education events like XChange. We will increasingly offer tools to help solution providers run their businesses, like our eXalt solutions sales accelerator and configuration tool. Other tools are on the way, but we can't do it without partnerships. If you have an idea about how we can work together to help advance all this, contact me. I'd love to talk.

Have an idea to make life easier for smaller VARs? Make something happen. E-mail CMP Channel Group President Robert Faletra at rfaletra@cmp.com.