Why Do I Need a Middle-Man?

Occasionally when talking with customers who tend to buy products direct from manufacturers, I’m asked the question:

“Why should I go through a middle-man/reseller when I can buy direct?”

It is a very good question—and knowing the answer to it can not only help you better understand why resellers are important to your business, but also determine if your resellers are actually providing you the value that makes them relevant.

First, let’s discuss where resellers fit into a business equation.  Here is a simple formula I use:

Time * Expertise = Accuracy

Time: How long it takes IT to move the business forward.  Planning, research, design and implementation all consume time.  The more time or man-hours available, the better likelihood of achieving positive results.

Expertise: The sum of knowledge and experience.  Teams of individuals who have strong expertise can achieve consistent, predictable results in even the most complex environments.

Accuracy: The likelihood of achieving the required business service levels within the given budget and desired timeframe.

The most important part of the equation is accuracy.  Business depends on high IT accuracy in developing new products, gaining the edge in a competitive market and in reporting numbers to Wall Street.  Both time and expertise determine a business’s ability to hit the mark on new projects without missing on milestones, budget or quality.

So where do resellers fit in?

Good resellers can provide a lot of value in increasing both the time and expertise portions of this equation.  While a typical IT staff may have a few engineers with experience and knowledge limited to only what they have been exposed to, resellers can have access to hundreds of experts each with experiences at, perhaps, dozens of different customer environments.  The expertise delta between a customer and a “good” reseller can be orders of magnitude apart.

Resellers can also provide value by reducing he time for solution integration.  Time is difficult for customers to improve on their own.  Most businesses have limited staff and, in IT especially, there is a long ramp-up required to integrate new employees into an environment before they can begin adding man-hours to the business.  Resellers can place specialized experts in a customer environment to implement complex solutions with very little ramp-up time.

Can’t manufactures do that?

Manufactures/Vendors can provide both expertise and implementation resources.  However, manufacturers have an agenda—so their expertise is tainted.  All manufactures will tell you there is only one good way to do something and that, *surprise*, their way is it.  Vendors are very good at espousing the benefits of their products and pointing out their competitors weaknesses (some of which is either out-dated, or good-ol-fashioned lies), while gracefully glossing over their own imperfections.  In order for a customer to get the whole truth and nothing but the truth, they need a reliable 3rd party having experience with all solutions as a mediator.

The interesting thing about expertise in the above equation is that it can be a negative number.  Have you ever taken a vendor’s word for a new solution and made a huge investment only to learn the expertise you relied on was bad?  Multi-million dollar mistakes take years to correct—you can’t spend the same budget twice. 

Sorting out vendor truths and identifying unspoken solution “gotcha’s” can be done on your own, but it is a slow, painful process.  It takes time—which is a precious, limited resource to your business.  Good resellers can cut through the marketing spin to get you the facts early and often.  They can be an invaluable resource used to seriously boost your IT accuracy.

Wait…those don’t sound like the resellers I know!

The problem with resellers is that they don’t all provide the type of value discussed above.  If you have been dealing with resellers for a while and haven’t seen benefits over a direct manufacture, you may be dealing with the wrong reseller. 

Bad resellers come in a few forms.  Some are no-value paper-takers.  They give you quotes and take your orders, however they don’t share any expertise that aids your business.  Some resellers take the easy route and only specialize in a single manufacturer.  This hamstrings their ability to provide you with with genuine vendor-neutral advice.  Their agenda aligns with that of the vendor they represent and so their expertise is tainted likewise.

Good resellers are concerned more about keeping your business—even if that means they need to have difficult, but truthful, conversations or even walk away from bad solutions.

As a reseller, my agenda is simple.  I want my customers to buy through me.  I don’t care what product that is, as long as it best fulfills my customer needs.  I protect my interests by aligning them with my customer’s interests.  Through candid advice based off my own expertise and the much greater expertise of the company I represent, I can ensure I’ll have a strong base of loyal customers for years to come.

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