Blog

Finding Your Niche in the Cloud

Posted on

When I talk to traditional hardware resellers, I often hear them say they want to sell cloud solutions but they’re not sure how to pivot their business. A lot of them express reservations—and even downright fear—about taking that step. Many worry about biting off more than they can reasonably chew, or having to completely reorient their current practice.

To answer them, I always explain that they don’t have to sell “cloud-everything” or radically change their business. Our most successful partners identify their niches in the market—such as voice or disaster recovery—and then find cloud solutions to fit that niche. They’re already familiar with the ins and outs of their particular segment, so it’s a matter of figuring out which solutions can “bolt on” to their existing offering.

In addition, the scalable nature of the cloud enables hesitant VARs to start small by picking one or two complementary solutions and then ramping up to add more services and solutions to their portfolio later on. This makes the transition to the cloud easier on their staff, builds organizational expertise at a comfortable pace, and provides a means to demonstrate the cloud’s profitability without a huge upfront commitment.

This last point is important because many VARs place the profitability question above ease of transition, and they don’t want to adopt the cloud because they don’t perceive it as profitable. This perception is magnified when they begin exploring the costs of building the infrastructure to connect their customers to the cloud.

The profitability objection is easy to overcome because, first and foremost, providing cloud services does not take away from hardware sales at all. There’s always a need for on-premise hardware and with the growing popularity of hybrid cloud solutions, VARS can actually present clients with more options and create bigger sales as a result. And even though the cloud market is now firmly in place, it is still experiencing wild growth in adoption. As adoption increases, so will sales.

Second, it’s critical to remember that the shift to the cloud isn’t a sprint; it’s a marathon. Building recurring revenue may be 3–4 year proposition, but in the long run, it can be significant. Forward-thinking VARs who are patient enough to evolve their business as the cloud matures will find that the recurring service fees substantially boost their overall revenue. Not only that, the contractual nature of the charges can also increase their company’s valuation because they are considered guaranteed future income.

Finally, while some VARs may have the capital to build their own data center, most don’t want to (or can’t) build a cloud solution from the ground up. In fact, those who go it alone may find themselves left holding the bag on a lot of expensive gear and idle manpower while their sales team figures out how to properly sell the cloud. A best practice for VARs is to partner with a reliable cloud infrastructure provider—like Green Cloud—to reduce their risk and allow them to focus on their core business, and leave the technical worries (and a lot of upfront investment) to someone else.

Contact Green Cloud today to learn more.