IT Resellers: What Is an IT Reseller and When Do You Need One?

When you’re looking for an IT reseller, you might encounter these common challenges:

• Understanding their role: Knowing exactly what an IT reseller does (and doesn’t do) to strategically use their services in your supply chain. 

• Evaluating options: Identifying key factors to consider when shopping around for an IT reseller. 

• Ensuring delivery: Making sure the IT equipment you purchase from your IT reseller reaches its final destination. 

In this post, we take a look at each aspect in more detail.

What is an IT Reseller, and How Do They Operate?

One simple way to understand the world of buying IT assets is by comparing it to buying cars. Generally, when you purchase a car, you’re not buying it directly from the manufacturer; instead, you buy it from a dealership, which is owned by a separate entity. Although the dealership works closely with the auto manufacturer, it doesn’t actually produce the cars itself.

IT resellers operate similarly. They partner with original equipment manufacturers (OEMs) of IT products, such as Lenovo, Dell, Apple, Arista, Cisco, and Samsung, as well as with the distributors for those OEMs. IT resellers then sell the necessary equipment to end users like you.

Often, an IT reseller serves as the single point of contact between the end user who needs the equipment and the OEM that produces it.

IT resellers play a crucial role in the IT equipment supply chain by bridging the gap left by manufacturers and distributors, who often lack the sales infrastructure needed to effectively promote and sell their products. Additionally, IT resellers provide essential knowledge to end users who may not fully understand the products required to support their IT infrastructure. 

An IT reseller maintains relationships with OEMs in the IT industry to purchase equipment from vendors and distributors, reselling it to end users. Some IT resellers, known as value-added resellers (VARs), go a step further by bundling the hardware with customized products and services, like installing the equipment upon delivery.

The best IT resellers are experts in the products they sell. They can provide detailed product information and recommendations, enabling you to make informed hardware and software purchase decisions. These resellers often position themselves as one-stop shops, appealing to end users for their convenience.

When Do You Need an IT Reseller? 

While each business has unique resources, expertise, and circumstances, there are several scenarios where working with an IT reseller could be beneficial: 

• Consolidating vendors: When your company’s IT needs involve multiple vendors and distributors, and you want to explore consolidating them into a single vendor. 

• Seeking expertise: When your company needs more information about IT solutions and is interested in discussing with an IT reseller.

• Additional services: When your company requires services such as pre-installing servers into racks, adding asset tags, or handling shipping — services that OEMs and distributors may not provide. 

• Leasing options: When your company prefers leasing IT assets rather than purchasing them upfront.

• Manufacturer referrals: When a manufacturer refers your company to an IT reseller for equipment purchase.

What Do IT Resellers Sell?

Most IT resellers offer a range of hardware and software products, often bundled together to provide added value.

• IT hardware resellers offer hardware to support IT infrastructure, including everything from servers, storage, and networking to personal computers, tablets, and phones.

• IT software resellers sell all types of software, including security, accounting, and project management. They often specialize in one type of software and are experts in that field. 

Top IT Resellers Companies (Sorted by Revenue)

IT resellers are available to any industry looking to purchase technology products that support their IT infrastructure. They serve all types of companies, from supplying IT hardware to large data centers that regularly need to add capacity in the form of servers, switches, and routers to supplying laptops for test-taking centers globally. 

If you’re looking for leading IT resellers in the US, here are five top companies sorted by revenue:

• Ingram Micro: $48.1 billion (2023)

• CDW: $21.3 billion (2023)

• TD-Synnex: $14.4 billion (2023)

• SHI International: $14 billion (estimated 2023)

• Insight: $9.2 billion (2023)

While working with an IT reseller can offer benefits like convenience, it’s important to be aware of their limitations. 

Working with IT Resellers: 3 Things to Keep in Mind

As you start to work with an IT reseller, keep in mind these three things:

1. Incentives may bias IT resellers toward specific products.

2. Each IT reseller’s expertise has its limitations. 

3. IT resellers have a limited ability to deliver IT equipment internationally because they often outsource distribution.

1. Incentives May Bias IT Resellers Toward Specific Products

IT resellers often position themselves as consultants, but it’s common for them to earn revenue through commissions from the OEMs they partner with. As a result, resellers might have a greater incentive to recommend products from these OEMs, even if other options are technically superior. 

Although repeat customers are valuable and should be a priority, it's important to recognize that these incentives can influence their recommendations. To mitigate this, consider working with multiple resellers to get a range of perspectives.

Another alternative is to hire an agnostic global IT logistics provider that can manage your resellers for you. This provider can share expertise on other parts of the supply chain as well, and not just the procurement stage. For example, our team at FGX has advised many multinational clients on how to consolidate their hardware purchases across several resellers and manage the shipping of consolidated equipment. 

If you’re part of a multinational enterprise, feel free to reach out to learn more.

2. An IT Reseller’s Expertise Has Limitations

While IT resellers are knowledgeable about their products, their expertise is typically limited to the OEMs they represent. This focus can lead to biases, as they might not have the incentive to learn about or recommend products outside their catalog.

Working with multiple resellers can address these biases but introduces a more complex logistical process, requiring you to manage relationships, orders, and shipments from various vendors.

To simplify this, consider consolidating your orders through a global IT logistics expert. This solution enables you to obtain equipment from different manufacturers without having to handle multiple points of contact.

3. IT Resellers Lack Shipping and Logistics Frameworks

While IT resellers excel at selling products and services, their shipping and logistics capabilities can be a weak link in their service offerings. This is often due to three reasons:

• Business model focus: IT resellers’ business models are typically optimized for closing sales rather than handling logistics. Even if they have relationships with shipping companies, they aren’t specialists in this area. Using our previous car dealership analogy, it’s like buying a car in Florida and expecting the dealership to handle delivery to the UK. They’re designed for sales, not for managing global shipping.

• Limited global reach: IT resellers often handle domestic shipping well, relying on established supply chains. However, international shipping is far more complex, involving customs clearance, HS codes, duties, taxes, and other other compliance factors. Some IT resellers may have internal policies against international shipping, resulting in outsourcing to in-market resellers, which can significantly increase costs.

• Sub-optimal shipping processes: Due to the issues mentioned, resellers may use less efficient shipping processes, leading to delays, customs issues, inadequate insurance coverage, and unexpected fees.

While some resellers may offer shipping services to close a sale, this is often not in the end user's best interest, particularly for international shipments.

A more strategic approach is to partner with both IT resellers and a global IT logistics expert. This ensures you get the best of both worlds: expert advice on products and efficient logistics management. That’s what we’ll cover next.

How to Benefit from FGX’s Global IT Shipping Service

When purchasing equipment from an IT reseller, consider partnering with FGX for an enhanced international shipping process. 

• We can consolidate all of your IT equipment from different vendors into one shipment, providing you one point of contact for all of your orders.

• We offer top-tier shipping solutions with coverage in 174 countries. Our shipments clear customs efficiently, even in challenging locations like Brazil and China.

When you work with FGX, you receive:

Fully Optimized Shipping Options Tailored to Your Specific Shipment

We assess dozens of factors to develop the most effective strategy for your shipment. There’s no one-size-fits-all global IT logistics solution; we aim to minimize duty exposure, ensure eligibility for importer of record and tax reclamation, and consider various factors for each shipment.

Feasibility and Compliance Checks

At FGX, we properly vet your shipment to ensure it will clear customs before we ship it. This includes verifying compliance for import, export, and product regulations and ensuring all relevant licenses and permits are in order. 

This helps prevent delays, denials, or unexpected duties and taxes.

Direct Air Freight Shipments

We ship use direct air freight and never risk delays or damages by working with a hub-and-spoke service. Your goods are delivered via a dedicated shipment, without multiple stops along the route.

Low-Variance Timelines

Our optimized shipping processes enable us to provide accurate delivery timelines that vary only by days, not months. 

Dedicated Customs Clearance

All shipments undergo formal customs clearance, not bulk or courier clearance, ensuring faster entry into your target country.

All-Risks Insurance

Our all-risks insurance provides peace of mind. If your shipment fails to clear customs or is damaged during shipping, you will be reimbursed.

FGX is more than just a reseller partner. We understand that international shipping is not a one-size-fits-all process. We take the time to learn your goals and offer the best options for each shipment. Beyond simple shipping and logistics, FGX provides consulting and execution at every step of the process. 

FGX services include:

• Acting as the IOR (Importer of Record) for your shipment or assisting you in acting as the IOR for tax reclamation

• Product valuation and compliance

• Assessing and paying any fees, import duties, and taxes on your behalf

• Handling paperwork, permits, and licenses

• Assigning international trade codes

• Obtaining necessary permits and licenses 

• Providing shipment insurance 

Many multinational enterprises trust FGX to deliver a best-in-class, seamless, global IT shipping experience for their IT hardware. Please reach out if you’re interested in learning more.