Value Added Distributors (VADs)
Additional services and solutions for the channel.
Additional services and solutions for the channel.
As the name implies, a Value Added Distributor (VAD) provides additional services and solutions that offer extra value to the channel and end users beyond basic pick, pack, and ship services.
Unlike standard distributors, VADs typically deliver enhanced support alongside the product or service.
In today's digital era, VADs are crucial in the dynamic multi-vendor, multi-disciplinary environments that require multifaceted roles rather than merely maintaining IT functions. Both vendors and end-user companies are embracing this shift, recognising the added value it brings to both sides.
The era of vendors dictating terms and distributors wielding channel authority is over. Today, collaboration and agility that deliver long-term customer value are paramount.
Leading VADs support a wide range of top vendors, ensuring no brand monopolies. Choosing the right distributor now hinges on finding a reliable strategic partner rather than just securing product delivery.
Research shows that most technology vendors reach their market primarily through distributor partnerships, with about 80% of vendor revenue stemming from these collaborations. VADs provide well-trained and managed sales teams, playing a critical role in go-to-market strategies. Benefits include:
A fully-equipped sales team
VADs typically have fully equipped sales teams ready to target specific markets. Experienced sales professionals can offer marketing suggestions, highlighting product strengths and market positioning. Sales Channel Managers act as the primary contact for channel partners, building and managing reseller networks.
Product and market expertise
VADs with a proven track record in a particular market have extensive knowledge and can offer valuable recommendations, data, and insights to resellers. This is particularly crucial for B2C companies, which often lack access to such information. Additionally, VADs have sales and technical teams that usually possess a deeper understanding of the products compared to resellers.
Training services
VADs, through their expert sales and technical teams, provide regular product training to support channel partners. These training sessions are essential for new sales representatives and crucial for newly launched products or the relaunch of existing products with new features.
Technical expertise
VADs house professionals with technical expertise in various products. These specialists support solution design, development, product demonstrations, and system integration. Beyond distribution, VADs offer consultancy, customised solutions, and implementation services, effectively functioning as software houses that assist in product development.
Credit facility options
VADs offer credit lines, margin-based pricing, and leasing options, lowering the entry barriers for resellers. This enables small and medium-sized resellers to partner with VADs and sell products they might otherwise not be able to offer.
The significance of value-added distributors
VADs are essential to the success of any newly launched technology. Through strategic VAD partnerships, supported by effective sales and marketing strategies, product vendors can convert potential customers into sales. The rise of multi-vendor business models and multi-disciplinary environments benefits the entire business channel, from vendors to end-users.
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