Value Added Resellers (VARs) have been around as long as the computer industry. Traditionally they take products manufactured by someone else (the OEM), add value and sell the new product combination on.
More recently, mid-range or so-called ‘mainstream’ engineering software products have tended to be offered by VARs because of the characteristics of the products and the market. The products — such as SolidWorks, Solid Edge and Autodesk Inventor — tend to be purpose-developed products with high-end functionality, at an entry level, high volume price. Because of the relatively low margins involved, an indirect channel of VARs has evolved to obtain appropriate, geographical coverage.
A combination of distributors such as Man and Machine and localised dealers has proved very cost effective in the past in setting up an alternative sales channel with 2D products like AutoCAD.
A distributor also empowers the total solution by researching and providing a full set of complementary applications to support the core mainstream product and offering customers true hybrid design capability that has hitherto been the exclusive preserve of high-end vendors. This concentrates effort and resources and avoids individual resellers duplicating activities.
Many mid-range players attempt to provide hybrid design capability with so called ‘best-in-class’ complementary applications and their application programming interface (API). to compete with high-end products, mid-range ones need to appear to offer the same kinds of software integration as their high-end competition. In all cases it is the VAR which is ultimately responsible for making sure that everything works.
The provision by the VAR of complementary applications and customised software and solutions is an effective way of generating incremental revenue from an account as well as providing a valuable service for the customer.
Neville Johnson Offices makes modular wooden desks, cabinets, closets, and other furniture for the home and commercial office, and bedroom. It is geared primarily to the home-office market so its furniture must fit into awkward spaces such as below stairs or in cramped lofts.
With the help of its VAR the company has integrated SolidWorks with DriveWorks from KB4, to facilitate the tailoring or ‘mass customisation’ of its product range. The design office creates a basic product family of designs in SolidWorks, and uses DriveWorks to customise these designs to meet individual customers’ specifications.
According to Bob Clements, managing director of NT CADCAM, the system integrator behind Neville Johnson: ‘We used the configuration engine underneath DriveWorks to link it into all other processes. So when you’ve specified ‘bought-in’ parts it talks to the ERP system, costing the product as it goes. The rules engine decides what mark-up to put on each part so that at the end of the process you know how much it is going to cost and how much profit is involved.’
‘For components that need to be designed the costing rules include costs of raw materials and elemental costs per cut and/or per weld,’ said Clements. ‘Also each of these costs can be marked up individually depending on the function, whether they are materials or labour related. All of the costing and quotation information is based on real information— the ‘wet finger in the air’ days are over. Not only is the quotation more accurate it is much more reliable and at the end of this process you know whether a job is worth doing or not.’
All the manufacturing and assembly drawings, the bills of materials and the cuttings lists are generated automatically and placed in a PDM system — the bills of materials are sent to the ERP system, which generates works and purchase orders. All these various systems have been linked together by the VAR in co-operation with the users so that the whole of the manufacturing enterprise can be more ‘customer facing’ and sales driven.
The same sort of technology is in use at Minivator, the
Minivator worked with its SolidWorks reseller, Solid Solutions Management, to develop a configuration application within its modeller to match the appropriate stairlift model to a customer’s space. Now, after measuring a staircase, engineers can input the values for angle, riser, and tread details into their modeller, which automatically generates an exact 3D model.
‘The level of detail requires the power of 3D modelling,’ said Nick Luckett, Minivator’s engineering manager. ‘Transferring these measurements into drawings manually or via 2D software takes too much time and can produce errors. 3D solid modelling overcomes these problems, giving us a competitive edge, so that we can deliver a stairlift that fits the customer’s site and can be easily assembled in only a few days.’
By providing true ‘added value’, VARs have an opportunity for real innovation in terms of product delivery to the market. This attracts market attention, provides regular incremental revenue and is a way of generating money from early trial or pilot implementations.
The provision of training and services that support business processes as well as enable specific software use is also crucial. Knowledge of customer processes gathered during these training sessions allows dealers to enhance their credibility within this sector and customise training solutions that satisfy specific customer requirements. It also provides them with invaluable insights into the real business drivers of their customers.