Why the Supply Chain Crisis Offers Channel Partners a Golden Opportunity

Since the traditional cloud has its own challenges — such as over- and under-provisioning, CapEx budget issues, and continual procurement hassles — the prospect of a faster, easier cloud should be seen as a welcome and unique opportunity for integrators and resellers. This article looks at how channel partners can leverage the supply chain crisis and spin it into new business opportunities.

Cloud Adoption Has Skyrocketed, But . . .

According to Jason Geis, CEO and co-founder of San Jose, Calif.-based CloudWerx, “The whole supply chain thing, in my humble opinion, is actually driving cloud adoption … It’s just driven customers to go the cloud route that much faster.”

However, cloud adoption is not a panacea for every technology problem. In fact, cloud repatriation or reversion to on-premises environments has become a real trend in recent years. More and more organizations have realized that cloud adoption is hard work and can sometimes be a hassle. Over- and under-provisioning, long procurement cycles, and CapEx budgeting concerns can make cloud adoption more of a cost nightmare and time drain than many are willing to endure. Making the best of the supply chain crisis and the backlog of hardware parts requires a different approach to cloud adoption altogether for channel partners and integrators focusing on cloud solutions.

Build Your Own On-Premises Solutions

When everyone relies on hardware solutions manufactured in China, and those are not available for upwards of a year, channel partners must be proactive and innovative. Think outside the box regarding traditional cloud, hybrid, or on-premises solutions. With more companies wanting control of their data, on-premises solutions have become much more prevalent.

Additionally, if you need a set of servers or virtual machines, look for used parts first. Don’t get locked in on the idea that everything has to be brand new. Work with the available inventory options to deliver solutions.

Change Your Business Model

If you’re a struggling channel partner dealing with frustrated customers and long backorders, don’t resort to a “tail-wag-the-dog” approach. You have plenty of options, and even though it might require stepping out of your comfort zone, this could be the golden opportunity you need. Look for products and services that you can transform into SaaS offerings. This might require tweaking your business model, but it could be a big win for your organization.

According to Mike Shook, president of Apex, N.C.-based 5S Technologies, “The supply chain issues have had a major impact. We tried to take a lot of our business practices and business models and figure out how to do software as a service around those products and model … Our VAR portfolio went from 80 percent hardware [and] 20 percent software to 60 percent software and 40 percent hardware. So, it’s definitely changed the business.”

Sometimes the roadblocks are really mountains of opportunity. While the supply chain crisis has created challenges for channel partners over the past few years, it has also forced others to look for more creative solutions to traditional problems. This is the key to increased innovation, higher productivity, and better ROI. The supply chain crisis is here to stay, but you can pivot. Find ways to work around the difficulties, adopt and experiment with new business models, and watch your organization transform into something bigger and more profitable than ever.