Maximising Margins for VAR and IT Resellers with NetSuite

Fingers picking out the best of a bar chart

As IT continues its evolution towards a more integrated ecosystem of applications and infrastructure and more brands appear, key purchasing criteria have moved from performance and features to added value, price and convenience.

Added value for VAR and IT Resellers is demonstrated since they act not only as a distributor but also implement, support and give service. Competition in the reseller space is fierce, every point of margin has become much harder to gain, and the value pools have shifted from sale of product to data-driven, IPR, platforms, pay by usage…, so agility to keep up with this new landscape and the ability to capture revenues from these new income sources, reducing costs and improving operating efficiencies whilst keeping relations and consolidating business is a must.

This is where digitalisation acts as a great enabler. It allows operational efficiencies beyond traditional processes and gives business transparency due to its real-time reporting. ERP systems automate and integrate their core business processes such as taking customer orders; billing, scheduling operations; keeping inventory records and financial data, optimising the business, increasing visibility and eliminating unnecessary costs. And the IT distribution channel needs to increase profitability through bigger margins at a lower cost more than ever.

NetSuite ERP integrates the sales, operations and financial functions, whilst adding business intelligence, marketing and eCommerce components as additional integrated value propositions.

Logical and user-friendly dashboard give VAR and IT Resellers the ability to manage these functions, which combined with the speed and accuracy of a digital platform, provides a real-time competitive advantage to our business management system customers, in all business perspectives, from the transactional side, to digital management and customer relations, not only keeping contact details up to date but tracking business interactions and managing their accounts.

Talking about profitability, NetSuite’s new capabilities enable IT players to capture the above-mentioned profit sources. We were delighted to hear, during SuiteWorld2018, that always up-to-date NetSuite incorporates new features that will allow IT players stay ahead of competitors. Added to the existing billing automation around subscription services and recurring billing, we will incorporate 4 new billing models:

Trial Pricing – The option to offer a trial price to customers. Based on weekly/monthly periods or upon the release of a new service.

Introductory Pricing – Similar to trial pricing but aimed at new customers typically over a longer period of time. Take web hosting, for example, you often receive an introductory price for the first years hosting and then it goes back up to normal price after a specified period.

Ramp Pricing – An increase or decrease in cost dependant on set factors. Common amongst energy and supply customers

Coverage Pricing – Charging for a projected usage which can be flexible depending on usage. Over the agreed usage the price could go up or down depending on the service/product.

All these options give IT Resellers as well as any SRP business the flexibility to set the most convenience invoicing to fit customers’ needs. It’s even possible to set A/B test pricing. This could be revolutionary for many businesses, imagine a streaming service offering 2 pricing models. One subscription led with unlimited usage and the other based upon usage with the ability to switch between the 2 at any point.

NetSuite ERP is a cloud-based secure transactional environment that allows distribution, margin visibility and works equally in a business-to-business (B2B) and business-to-client (B2C) environment providing:

  • Enhanced client experience and satisfaction,
  • Unlocking greater value for clients,
  • Allowing data-driven decision making,
  • Increasing operational efficiencies,
  • Positioning the company as a digital innovator,
  • Driving greater profitability,
  • B2B, B2C and B2B2C management, including dropship,
  • Granting the ability to manage software sales (direct and resale), hardware and solution provision,
  • Granting margin protection and management,
  • Supporting credit control,
  • Provisioning field support and installation management,
  • Managing fixed term and perpetual contracts.

A great advantage of NetSuite is it offers suites to manage all business branches and can be configured specifically for your IT business. SuiteCommerce allows distribution and channel margin visibility for users, both for B2C and B2B (not public facing). And because it is all built in the same platform integrations are not needed, saving money and time as well as securing a continuous flow of consolidated information through all the business. But, if by any means you want to use a specific app you are happy with, our developers are certified to integrate through APIs so you can seamlessly connect to any IT system you desire and guarantee fully automated workflows throughout the platform and give clients a seamless user experience for their customers.

As an IT and service company ourselves and many clients in the sector we have a clear insight into the unique demands and challenges faced. As organisations often struggle with complex and continually evolving revenue recognition rules, real-time visibility and having systems specifically tailored to this market is a must. Feel free to contact our consultants to see how we can support your growth and optimise business.

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