The VAR Value-Add

By Ericka Chickowski  |  Print this article Print


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As the IEEE prepares to ratify the 802.11n wireless Wi-Fi standard in September, VARs believe enterprise customers may begin to open their wallets now that the specification has graduated from its draft status.

Nevertheless, as a part of his added value to the customer, Seltzer is trying to future-proof his deployments as much as possible.

"We're saying, 'Hey, for a small uplift in cost, buy something that’s eventually going to support n,’" he says. "'Don’t do a forklift upgrade on your wireless gear in three years when all of the other peripherals catch up.’"

Future-proofing is also the kind of consultative value-add that Lindahl offers Invictus customers. He says that smaller wireless resellers are going to need to figure out a way to offer more value in the coming few years because as the average selling price (ASP) of wireless products plummets, resellers will get eaten alive by volume sellers if they don’t. Falling ASPs is a trend confirmed by ABI in its most recent report.

For example, Lindahl points to an announcement in mid-August by Ubiquiti Networks that revolutionized the pricing scheme for multiple-in, multiple-out (MIMO) outdoor wireless equipment. Ubiquiti greatly lowered the pricing threshold on outdoor MIMO products with its new Airmax line. Not only that, but it is publishing prices on its Website, giving resellers little flexibility in establishing much of a margin without looking usury in customers’ eyes.

"This actually changed the marketplace by a quantum leap in one day," he said. "We've gone from virtually almost nobody having a true 8012.11n MIMO product for the outdoor space to having probably the cheapest player in the market having a full product line in 24 hours time."

While the more affordable equipment certainly offers a lot of opportunities for VARs such as Invictus and GroundForce IT to sell into smaller organizations that would never have been able to afford certain types of wireless projects in the past, there is so much price sensitivity and so little margin that the value-add sell has to be done carefully.

"We're hoping to drive business to us, but it really, really pushes the price point down and there are a lot of e-tailer players in the market that basically just sell out of the online store, whereas we add value, we do complete installation projects, consulting and so on," he says.

As a wireless integrator, Lindahl believes his value proposition is expertise.

"A lot of the e-tailers out there really don’t understand wireless at all. They can’t add value. They can’t even recommend configuration setups because they’re not even qualified to provide that information," he says. "We’re a wireless integrator—that’s all we do and we understand the technology and can make it work well. Getting that word out, instead of being just a box mover, that’s key."

Similarly, Seltzer says that the way his company is profiting off of wireless is in security configuration and similar consulting services that he calls his "bread and butter."

"We're layering in security services, specifically on making sure that somebody doesn't sit in the parking lot to do what everyone fears—snagging onto your wireless network and getting up to no good," he says.


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