OT: Unusual Cisco Reseller Business Models

From: Joe Rinehart (jjrinehart@hotmail.com)
Date: Thu Jan 03 2008 - 15:19:33 ARST


I have a thought I wanted to bounce off everyone since most of us are or
have been connected to a Cisco partner relationship directly. I am very
clear on the technical aspect of how it all works, but not as clear when it
comes to the various business models out there with regard to being a Cisco
reseller. The way I see it, there are slight variations in essentially the
same themes:

1. Value Added Reseller/Systems Integrator Approach:

        a. Cisco hardware/Smartnet purchased at a discount and resold at a
fixed margin.
        b. Professional services revenue sold in conjunction with HW/SW at
a higher margin.
        c. Ancillary and/or related services or products as possible add-on
revenue.
        d. Two basic approaches: Lead with hardware and pull through
professional services or
                lead with professional services and pull through hardware.
        e. Examples: Calence, Dimension Data, INX, Nexus IS, etc. (using
local examples here)

2. Distributor/Hardware Vendor.

        a. Typically hardware sale only, usually low margin and high
volume.
        b. Few or no professional services involved, often e-fulfillment
through web or other means.
        c. Highly transactional.
        d. Examples: AT&T, Verizon, Qwest, Comstor, Tech Data.

I am not sure I have seen anything outside of these basic models, can anyone
add or advance any ideas?

Joe Rinehart, MBA, CCIE #14256, CCNP/DP/VP
Systems Engineer
NetVersant Solutions
www.netversant.com



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