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How to Increase the Value of a Distribution Business
Transforming a distributor or reseller into a valuable company may seem like a daunting task. Distributors are usually not worth very much, because an acquirer reasons that without a point of differentiation, a distributor is vulnerable to a price war. Rather than acquire a target company, a savvy potential acquirer of a distributor could temporarily lower their price for whatever is being distributed and woo most of the target company’s customers without acquiring the company.
However, the key to this transformation lies in setting yourself apart through innovation and the development of intellectual property (IP).
The Value of Developing Your Own IP
Look at the story of Miles Faulkner, the founder of Blended Perspectives, a reseller specializing in Atlassian products, which offer software solutions for large teams. Faulkner’s story provides a blueprint for how to punch above your weight when selling a business that distributes or resells other companies’ products.
Driven to create a more valuable reseller, Faulkner set his sights on creating a product of his own: the Marketplace Analytic Research Service, or MARS. This tool is designed to guide Atlassian users in selecting the most appropriate aftermarket apps to supplement their Atlassian software.