How to Increase Profits in a VAR Business
Although VAR business is essentially a low-margin business, one can still earn more money and stay profitable by making processes more efficient through automation. Automating processes that are ‘busy work’ for sales reps can be helpful to improve productivity, in turn helping to increase sales. Choose a Business management solution that come with different features, which automate your quoting process as well as enable you to keep track of customers efficiently. A management tool that has a built-in Sales quoting software and CRM can be the best fit to run your business in the most efficient manner.
Apart from automation through Best online quoting tools, employing the right pricing strategies is equally important. For instance, you need to avoid overpricing products as it can reduce sales and lower revenue. However, at the same time the pricing should not be so low that it robs you of your profits. Another disadvantage of selling products at a very cheap price is that people may start suspecting the product quality, which can also decrease sales. The key is to strike the right balance through competitive pricing. So find out at what pricing your competitors are selling products and accordingly decide what works best for your business.
You also need to identify products that are giving you higher and lower margins. This will give you an idea about your best selling products. You can keep stock of lower margin products to a minimum so that you don’t spend additional cost on their storage. In some cases, VARS can bundle low margin products with higher margin offerings, which can also help to generate a more profitable product.
Last but not least, make the customer feel valued. This can create a positive word of mouth, which can benefit your business in the long run. So apart from selling products, provide services that help to resolve customer issues. Reducing turnaround time, providing prompt service as well as tailoring products as per requirement can also make the customer feel valued, happy and satisfied.