The technology channel has been pronouncing the death of the value added reseller for the better part of a decade. Cloud computing would eliminate hardware resale. SaaS would bypass the channel entirely. Direct-to-customer models would make the middleman redundant. None of it happened. The IT VAR market was valued at over $90 billion in 2024, according to Statista’s IT channel market data, and the VARs growing fastest today are not the ones who resisted change. They are the ones who evolved their definition of value-added from product configuration to complex solution architecture, compliance integration, and managed services delivery.
Understanding what a value added reseller is, how the model differs from a managed service provider, and why vendors continue to invest heavily in VAR channel programmes is essential knowledge for any technology business operating in the B2B market. This article explains the VAR model clearly, examines how it has evolved in a cloud-first environment, and covers what both vendors and buyers need to know about working effectively with value added resellers in 2026.
The Value Added Reseller Model: What It Actually Means
A value added reseller purchases technology products, typically hardware, software, or cloud services, from manufacturers or distributors and resells them to end customers with additional services included in the transaction. The “value added” component is the key distinction: the end customer receives not just the product but a configured, integrated, and supported solution.
What the value addition looks like in practice
For a network infrastructure VAR, value addition might mean designing and deploying a multi-site network architecture using Cisco hardware, configuring security policies, training the client’s IT staff, and providing first-line support for the first twelve months. For a cybersecurity VAR, it might mean assessing the client’s security posture, selecting the appropriate endpoint detection and response platform, deploying and configuring it across the organisation, and delivering a post-deployment security operations runbook. For a cloud VAR specialising in Microsoft Azure, it might mean migrating on-premises workloads, optimising cloud cost architecture, and setting up a managed operations layer.
The common thread across all of these examples is that the VAR is doing work that the manufacturer cannot do efficiently at scale: the local knowledge, the client relationship management, the implementation expertise, and the ongoing support that transforms a technology product into a working business outcome. This is why vendors maintain channel programmes. The DiscoverMSPs VAR directory provides a clear view of how this specialisation is distributed across technology categories and geographies.
Revenue model and margin structure
Value added resellers earn revenue from two primary sources: product margin on the resale of technology, and professional services fees on the implementation and support work. Product margins in the technology channel have compressed significantly over the past decade as cloud procurement has shifted some categories toward direct vendor sales. The VARs who have maintained strong profitability have compensated by growing the professional services component of their revenue mix, which carries substantially higher margins than product resale and is less susceptible to price competition.
VAR vs MSP: Understanding the Distinction That Matters
The question I encounter most frequently from both vendors and buyers when discussing the channel is: what is the difference between a value added reseller and a managed service provider? The answer has a clean structural component and a messier practical reality.
The structural difference
The structural distinction is straightforward. A value added reseller earns revenue primarily from technology transactions: selling and implementing a product or system. The commercial relationship is episodic – it begins at project initiation and concludes at project completion. A managed service provider earns recurring revenue from ongoing operational management under a long-term contract. The commercial relationship is continuous – it does not conclude when a project is delivered but persists for the duration of the contract, typically one to three years.
The practical reality: many firms are both
The practical reality is that the VAR and MSP models have converged significantly. CompTIA’s channel research documents a sustained trend of VARs adding managed services to their portfolios: once a VAR has implemented a technology for a client, managing that technology on an ongoing basis is a natural and commercially attractive extension of the relationship. Many firms now operate both models simultaneously, which is one reason the distinction between VAR and MSP is increasingly difficult to maintain cleanly. SaaS resellers and ISVs represent another closely related category that occupies the space between pure product resale and managed services delivery.
Why Technology Vendors Still Need VAR Channel Programmes
The persistence of the VAR model despite the structural changes in technology procurement is not accidental. Vendors who have attempted to bypass the channel in favour of direct sales consistently discover that the economics of direct sales at scale do not work for most technology categories. The channel solves specific problems that direct sales cannot address efficiently.
Local market access and client relationships
A technology vendor based in San Francisco cannot build and maintain trusted relationships with IT decision-makers across thousands of mid-market businesses in markets from Dallas to Manchester to Singapore at the cost efficiency that local VARs provide. Value added resellers have invested years in building client relationships, industry expertise, and local market credibility that vendors can access through well-structured channel programmes far more cost-effectively than building equivalent direct sales capacity.
Implementation capacity at scale
Even vendors with strong direct sales capability face a fundamental capacity constraint: they cannot implement their technology at thousands of client sites simultaneously. Value added resellers provide the distributed implementation capacity that allows a vendor’s technology to be deployed broadly and correctly. A well-enabled VAR channel effectively multiplies a vendor’s professional services delivery capacity without a proportional increase in headcount or cost. Verified channel partner data from DiscoverMSPs helps vendors identify the right VARs for their specific product category and target market.
Vertical expertise that generalises poorly
Technology deployments in healthcare, financial services, manufacturing, and legal sectors require domain expertise that generalises poorly across verticals. A VAR who has built their practice around healthcare IT carries HIPAA compliance knowledge, clinical workflow understanding, and EHR integration expertise that a generalist sales team cannot replicate. Vendors who distribute through vertically specialised VARs gain access to this expertise for every client the VAR serves, which improves deployment quality and client outcomes without requiring the vendor to build that vertical knowledge internally. The Gartner channel sales research consistently identifies vertical specialisation as the strongest predictor of VAR partner performance.
Looking for verified value added reseller contacts for your channel programme? Browse the DiscoverMSPs VAR directory to find reseller partners by technology specialisation and geography.
How the VAR Model Has Evolved in a Cloud-First Market
The VAR model of 2026 is not the VAR model of 2015. The shift to cloud computing, the compression of hardware margins, and the rise of subscription-based software have fundamentally changed what value addition means in the channel.
From product configuration to solution architecture
The VARs who are growing in 2026 have moved their value addition up the complexity curve. Rather than configuring servers and deploying standard software packages, they are designing multi-cloud architectures, implementing zero-trust security frameworks, building compliance automation into infrastructure deployments, and delivering outcomes measured in business terms rather than technical specifications. This shift requires substantially more expertise and commands substantially higher margins than traditional resale, which is why the VARs who have made it successfully are more profitable today than they were when hardware margins were higher.
Recurring revenue through managed services integration
The structural weakness of the pure VAR model is revenue unpredictability: project-based businesses experience feast-and-famine cycles tied to client capital expenditure decisions. The VARs who have added managed services to their offering have addressed this weakness by building a recurring revenue base that stabilises the business and provides the financial foundation to invest in talent and capability. This evolution toward the managed services model is documented across the IT channel and is the primary driver of the blurring distinction between VAR and managed service provider categories.
Frequently Asked Questions
1.What is a value added reseller?
A value added reseller, or VAR, is a company that purchases technology products from manufacturers or distributors and resells them to end customers with additional services layered on top. These services typically include system integration, customisation, installation, training, and ongoing support. The value addition distinguishes a VAR from a simple product reseller: the end customer receives a configured, integrated solution rather than a product from a warehouse.
2.What is the difference between a VAR and an MSP?
The core distinction is the commercial model. A value added reseller earns revenue primarily from technology transactions: the commercial relationship concludes when the implementation project is delivered. A managed service provider earns recurring revenue from ongoing operational management under a long-term contract. Many companies now operate both models simultaneously, implementing technology as a VAR and managing it on a recurring basis as an MSP.
3.How do vendors find and work with value added resellers?
Technology vendors find value added resellers through structured channel partner programmes offering deal registration, margin incentives, technical certifications, and co-marketing support. The most effective approach to finding the right VAR partners is using a verified contact database segmented by technology specialisation, geographic coverage, and vertical focus. DiscoverMSPs provides verified VAR and reseller contact data so vendors can identify and approach qualified channel partners directly.
4.What certifications do value added resellers typically hold?
VAR certifications depend on the technology categories they serve. Microsoft Gold or Silver Partner status is standard for Microsoft-focused resellers. Cisco Premier or Select certification for network-focused VARs. AWS Partner Network tiers for cloud-focused resellers. Cybersecurity VARs often hold certifications from CrowdStrike, Palo Alto Networks, or Fortinet. CompTIA Security+ and other vendor-neutral qualifications are common baseline certifications across VAR organisations of all sizes.
5.Is the VAR model still relevant in a cloud-first world?
Yes, but it has evolved significantly. Pure product resale margins have compressed as cloud procurement shifted some purchasing directly to vendors. The VARs thriving in 2026 have reoriented their value addition toward professional services, cloud architecture, security implementation, and compliance management rather than hardware resale. The implementation and integration expertise VARs bring to complex technology deployments remains genuinely valuable in cloud, hybrid, and on-premises environments where configuration complexity is high.
6.How do I choose between a VAR and an MSP for my business?
Choose a value added reseller for technology procurement and implementation projects where you have internal IT capability to manage the solution post-deployment. Choose a managed service provider when you need ongoing operational management rather than project-based delivery. For many mid-market businesses, the answer is a provider who can serve both functions: implementing technology as a VAR and managing it as an MSP, which delivers continuity of knowledge across the full technology lifecycle.
The VAR in 2026: Value Addition Has Never Been More Important
The narrative that cloud computing would eliminate the value added reseller was always based on a misunderstanding of what value addition actually means. Cloud made hardware resale less important. It made solution architecture, security integration, compliance management, and operational expertise more important, not less. The VARs who understood this early are among the most profitable technology businesses in the channel today.
For vendors building channel programmes, the value added reseller remains one of the most efficient routes to market available: distributed implementation capacity, local market relationships, and vertical expertise that direct sales cannot replicate at comparable cost. The key is finding the right VARs for your specific product and market, which requires verified data rather than speculative outreach to every reseller in a geography.
DiscoverMSPs provides verified VAR, MSP, and channel partner data segmented by technology specialisation, geography, and vertical focus. It is the starting point for any vendor building a channel programme that is designed to convert, not just to grow a partner count.
