Making the most of SaaS

Since most SaaS offerings have minimally an annual contract associated with them, the VAR can not only realise a higher booking value, but in most cases an annuity revenue stream.
Most of the vendors’ SaaS programmes offer the reseller the opportunity to share in the margin over the customer life cycle (in many applications, this could be five-seven years or longer). This actually has another large benefit over the more traditional software sales model. The valuation of the VAR’s business will be much higher if the VAR has a run rate of revenue that is predictable and consistent. This also affords a level of smoothness to the revenue stream that allows VARs to more comfortably invest in their own businesses as they have a historical run rate of business that they can count on seeing.
 
Prudence
So with that as a backdrop, answering the original question about “whether a VAR can ever hope to exploit the benefits of offering SaaS solutions to their clients without a dramatic shift in their business model?” becomes clearer. There is no need to run before you walk. The more prudent approach is to evolve the business model.
Start by taking on SaaS services that are complimentary to your existing business and invest enough to get started. Ask the vendor to provide training and some initial sales support until you can ramp the business and cost justify the growing investment that allows you to profitably scale your business. Focus first on your own client base and identify key prospects from that list. Conduct webinars with those clients (most vendors will support this effort) to educate them on the value of the new SaaS services you are now offering.
 
Knowledge domain
Many have successfully adopted this hybrid business model approach as they start to ramp their SaaS offerings. In the area of SaaS security, VARs that up sell their software install base with an SaaS offering have provided a comprehensive threat protection solution for their clients systems. Security itself is a multi-billion dollar market opportunity that has embraced SaaS offerings to compliment desktop security. As mobility continues to expand within the business community SaaS application become a more practical deployment strategy for ubiquitous coverage.
Start in the specific knowledge domain of your organisation as you add SaaS to your existing portfolio of offerings. The breadth of offerings and creativity of packaging them allows you to also approach more opportunities on a consultative basis allowing you to solve problems for your clients in creative ways. Before you know it, your organisation will be well on its way to leveraging the adoption curve of SaaS solutions.