VAR 100: Some signs of life return
After nearly three years of suffering mostly declining sales, it appears there are some
encouraging signs of recovery for top accounting and ERP software resellers.
There’s no dramatic rebound, but accounting resellers
are finding some areas of growth
BY SETH FINEBERG
As a result, a number of resellers are seeing an uptick in
application purchases or reporting that customers are upgrading their long-neglected or outdated systems.
This isn’t to say a full-on recovery is in effect for top VARs
— far from it, in fact, as there were many resellers that continue to follow the seesaw course of the economy, showing
spots of growth mixed with flat-to-declining results.
Those that did show signs of improvement claim a variety
of factors affected their business, ranging from increased
client purchases and the introduction of new products, to
improved marketing efforts and, as in years past, taking advantage of acquisition opportunities.
Santa Monica, Calif.-based Microsoft Dynamics AX and
NAV reseller SCS Inc. saw a slight bump in its revenue from
2009, to $15 million, despite what chief executive Helen Russell still views as a “questionable economy.” She sees her firm
continuing to do well due to renewed marketing efforts and
service, rather than just software sales.
“Our sales team has been virtually unstoppable, we really
feel we’ve done an excellent job at that, but looking for ward,
it comes down to more targeted marketing and reaching our
verticals with messages that let [clients] know we are here to
help them improve their business,” said Russell. “Secondly,
and most importantly, is continuing to deliver a superior
technical product, and provide excellent service. If you aren’t
delivering what’s promised and more, then you’ll be out of
business down the road.”
Alpharetta, Ga.-based OmniVue Business Solutions expe-
rienced a near 15 percent lift in revenue from 2009, climbing
to $8 million. But it also sees the down economy and uncer-
tainty of its recovery as having the greatest impact on what
Growth from some firms came in the form of acquiring new
products as well as other firms, and for those in a capital and
strategic position to do so, that trend looks set to continue.
Over the past year, Lancaster, Pa.-based Sage reseller RKL
eSolutions — an offshoot of CPA firm Reinsel Kuntz Lesher
— added Sage ERP X3 to its list of ERP product offerings and
purchased long-time Sage partner Waterview IT in October.
RKL president Joe Noll said these moves “created a positive
buzz for us that has allowed us — a very technical and cus-
tomer-focused company — to get [the kind of] marketing
hype that a lot of our competitors have spent much time and
Other significant mergers over the past included the join-
ing of InterDyn BMI and InterDyn Progressive; national CPA
and consulting firm RSM McGladrey’s purchase of Caturano
& Co., both of which had significant reseller businesses; the
union of Jewel & Associates and Innovative Solutions Group
to create Acumen Advisors; and Net@Work’s acquisition of
The Fitzgerald Group and later Forepoint, which made Net@
Work a national VAR.
BEYOND THE VAR 100: Ones to Watch
While our main list of the VAR 100 appears on pages 32 and 33, below are some firms that, though they did not
make this year’s list, are significant resellers who will bear watching in the future.
VAR / Location Accounting software
Grassi & Co. / Jericho, N. Y. Sage MAS 90/200/500, Timberline
InterDyn CFO Consulting / Orlando, Fla. Dynamics GP, NAV
CAL Business Solutions / Harwinton, Conn. Dynamics GP
Pannell Kerr Forster of Texas / Houston Dynamics NAV
Explore Consulting / Bellevue, Wash. NetSuite
Knaster Technology Group / Centennial, Colo. Dynamics GP
Paradigm Technology Consulting / East Windsor, N.J. Dynamics GP
Axis Integrated Solutions / St. Louis Sage Accpac, Pro ERP, MAS 90/200, Peachtree
Templeton & Co. / West Palm Beach, Fla. Dynamics GP, SL
NOT ALL GOOD
Still, despite noted improvements from a year ago — and
even the past couple of years — many top VARs continue to
struggle. In fact, 22 percent of this year’s VAR 100 were off
from last year, and several more who had appeared on past
VAR 100 lists did not make the cut.
Sage and NetSuite reseller Hightower of Skokie, Ill., saw
its revenue drop from 2009, citing economic conditions that
continue to negatively impact its clients.
“As software manufacturers find it tougher to make their
quarterly and annual net income goals, they will continue
to squeeze their channel on margin and tier requirements,”
said Hightower chief executive Jeffrey Rosengarden. “It’s
tougher to make sales but we’ve been lucky, recruiting highly
qualified and experienced individuals to our consulting and
Open Systems and Sage reseller Applied Business Services
of Gaithersburg, Md., also saw a dip in its revenue from 2009,
as the unstable economy has prompted many of its clients to
remain cautious about new software purchases.
“Many are delaying decisions based on the economy, so
the close time is longer and also, many prospects are looking for longer payment terms,” explained Applied Business
Services president Maureen Williams, who nonetheless remained optimistic about the future. “Our customer service
is appreciated much more due to the fact the larger firms are
having cutbacks of their support services, and we are getting
many new clients from other business partners’ poor service.
We’ve been hiring, not cutting back. We also have ramped
up our marketing efforts. In the long run, I believe the small
companies like ABS will excel.” AT