The companies visited to and pitched to by software resellers are often small and medium enterprises (SMEs), local businesses and niche operators. This benefits the software house as they may not hold the resources for the legwork needed to spread their network on a lower scale. While it benefits the reseller because he/she can build up networks of smaller clients and become a single point of contact for them for every aspect concerned with the software, be it advice, training or updating.
Resellers also operate in the internet connectivity space. Here, a reseller, sometimes referred to as a virtual internet service provider (VISP), provides internet services from another ISP but resells those services under its own brand. In the software industry, software resellers offer customers access to multiple products for simplified sourcing. According to Gartner, software resellers include such companies as CDW, Insight, SHI, Softchoice and SoftwareONE.
IT vendors offer channel partner discounts that enable resellers to purchase products below list price. Vendor discounts vary widely and may range from 10% to 50%, depending on such variables as type of product and the volume of product the reseller is purchasing. The idea behind reseller discounts is to cover the channel partner's sales and marketing costs and leave room for profit margin.
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