TSDs: Revolutionizing Technology Distribution Channels for MSPs and Enterprise
- Dean Ara
- April 29, 2016
In the ever changing IT market, intelligent distribution solutions are in hot demand. With new products flooding the market daily, service suppliers are hungry for innovative technology distribution channels to help bring their offerings to the end-user as seamlessly as possible. Meanwhile, at the other end of the spectrum, MSPs that want to differentiate themselves are looking for support to source the best end-user products amongst the vast amount of options available.
Enter the Technology Service Distributor (TSD). Otherwise known as the ‘master agent’, TSDs are gaining quite a bit of interest from both suppliers and MSPs these days. Creating tighter synergies within technology distribution channels, TSDs add enormous value to suppliers, sellers, and end-user enterprises. And according to many industry experts, TSDs will become exceedingly valuable as more and more products hit the distribution channel.
But are they right for you and your customers? Let’s first look at how they work.
What Is a Technology Service Distributor?
TSDs sit in the middle of the technology distribution channel, between an extensive network of IT service providers and telecom sales agents, like value-added resellers (VARs) or MSPs. By virtue of their broad portfolio reach, these TSDs give sales agents and their end-user customers access to the best products, financing, and training.
Handling a vast amount of software and hardware, TSDs ship over 150 million items and manage over 100 million software licenses each year. In a nutshell, TSDs act as a single-stop hub that gives IT sales agents unlimited access to the services they and their customers need. Today, over 50,000 end-user enterprise customers benefit from the solutions provided through the TSD model.
This quick diagram by Intelisys, one of the largest TSDs in the world today, offers an excellent snapshot of the TSD model:
Image source: Intelisys. The Technology Service Distributor ecosystem.
The Top 5 Benefits of Using a Technology Service Distributor
Now that we know how TSDs work, let’s take a look at how they’re transforming technology distribution channels and why they’re so favorable to sales agents, like MSPs, and their enterprise customers.
Here are five of the top benefits of using a TSD:
1. Ease and Quality of Solution
Through their extensive network of service suppliers, TSDs can give sales agents quick access to the right service solution that matches their customer’s specific need.
From an enterprise perspective, picking the right Cloud supplier from the overwhelming number that now exist can be challenging. TSDs eliminate this by quickly providing a selection of pre-qualified suppliers. By doing so, TSDs save sellers, and their enterprises, the hassle of timely contract negotiations.
2. Reputation & Freedom
As the intermediary between the supplier and seller, TSDs eliminate the sales quotas that are often required by suppliers in a direct supplier-seller relationship. Without these quotas in place, sales agents can freely offer their customers unbiased advice and service support that’s truly responsive and tailored to their needs and goals.
As trusted IT advisors to their clients, MSPs must have, or have access to, expert advice on cutting-edge computing solutions. TSDs fill in any knowledge gaps that MSPs may have by giving them access to leading resources in the field. With an expanded knowledge bank, MSPs are able to solve almost any client challenge quickly and confidently.
3. Increased Seller Profits & Customer Savings
Finding the best supplier that matches a client’s product needs and budget can be a challenge. While suppliers often post pricing comparisons on their sites, they’re often biased towards that supplier’s products (and overlook the features of other suppliers). Cloud hosting comparison sites can be useful to gain a more unbiased look, but results may be limited to the data filters provided.
In truth, finding the right supplier for a client comes down to both expertise in available product and a customized approach to a client’s Cloud hosting needs. TSDs achieve both by way of their access to a large array of suppliers and their unbiased 3rd party position. Using their extensive supplier network, TSDs are able to secure the best pricing for the exact products a client needs. Along with that, they’re also able to secure great commission rates for sellers.
All of these benefits translate into great savings for a seller’s clients. And of course, a happy client means a retained client.
4. Protection
Their neutral position also provides TSDs greater contract negotiating power, which in turn ensures the interests of sales agents are protected. So even during times of supplier merger and acquisitions, sales agents and their customers are guaranteed contract protection and pricing.
5. Reduced Administration
It costs a lot for sellers to secure and serve an enterprise client. From marketing and sales to account management, billing, and receivables, the administration costs associated with the initial contract and ongoing operations can quickly consume a seller’s profits.
A TSD lightens this burden by providing a simplified contract, support, and billing system. During contract negotiations, the TSDs serves as an intermediary between the seller and supplier. And when it’s time to bill, TSDs collate all payments from multiple suppliers into a single payment to a seller — which simplifies the huge administration process associated with accounts receivables.
On the support side, TSDs provide a simplified and powerful support system to keep their end-user customers reliably and happily serviced post-implementation.
TSDs – The Future of Your Technology Distribution Channels
To recap, TSDs distribute technology service solutions from service suppliers to a network of IT sales agents, like MSPs. By tapping into a broad selection of suppliers, these sales agents can immediately source the best technology solutions to keep their enterprise customers happily equipped with tools best matched to their needs.
Interested in learning how a TSD can add value to your technology distribution channels? Reach out to our partners at Intelisys today.
