Making the OEM and Value Added Reseller Ecosystem Work for You

Enterprises spend enormous sums on products and services from OEMs (‘Original Equipment Manufacturers’) – e.g., networking products, servers, IT tooling, end-user computing, audio/visual, collaboration tools and devices, and all the subscriptions and support that go with them.

Yet the vast majority of this spend falls into an indirect contractual and financial relationship between the enterprise and the OEM, because OEMs almost universally use channel models where they sell their products and services via value-added-resellers (VARs), rather than transact directly with customers.

Despite the purported “value-added” concept, this OEM driven approach for purchasing their products and services is not designed for the advantage of the customer. Instead, it obfuscates the contractual and business relationship between the customer and the actual party providing the products and services (i.e., the OEM), undermines and inhibits transparency on pricing and discounts, and enables the OEM and VAR to hide behind each other when problems arise.

TC2 helps enterprise buyers navigate this market reality with tried and tested solutions that overcome the challenges of the VAR transaction model, deliver pricing transparency and establish firm contractual foundations that make the OEM and VAR ecosystem work for you, not against you.

Engage the OEM Directly—Not Just the Channel

When enterprises are making—or contemplating—significant investments in products and services from a particular OEM, direct engagement with the OEM is essential.

While VARs play an important role in procurement, logistics, and delivery, they do not control the commercial levers that ultimately matter most. OEMs set pricing, discounts, program eligibility, and the underlying contractual frameworks based on the end customer—not the reseller through which the transaction flows.

Too often, enterprises are told by resellers that key terms are “non‑negotiable” because they are simply passing through OEM conditions. At the same time, OEMs may deflect responsibility by directing customers back to the reseller. This dynamic is common, but it is not accidental. It introduces unnecessary opacity, diffuses accountability, and weakens the enterprise’s negotiating position.

The reality is straightforward: OEMs control pricing and commercial terms. Meaningful leverage comes from engaging with them directly.

TC2 implements a better approach by separating commercial strategy from transaction execution. We help enterprises negotiate pricing, discounts, entitlements, and key commercial terms directly with the OEM, then use the reseller as the transactional and fulfilment vehicle. We support enterprises to establish direct contractual structures with the OEM to govern the indirect transaction through the channel.

This model works within the market reality of resale, rather than fighting against it, while restoring transparency, clarity of obligation, and commercial control—ensuring the enterprise is not caught between parties when issues arise and providing a deal that provides commercial transparency and clarity.

Expert Services to Solve Complex Challenges

TC2 provides solutions to the most complex technology procurement challenges faced by our clients. From setting strategy, executing sourcing processes and supplier negotiations, to compliance, and cost optimization services, our team of experts bring the market knowledge, process discipline, tools, and buyer-side leverage needed to maximize results from your complex technology programs.

Apply a Strategic Sourcing Approach to the VAR Layer

With all the complexity and effort required to solve the complexity of the channel model and engage directly with the OEM, it can be easy to neglect the sourcing process for the VARs themselves. But that is a costly mistake, because the VAR layer materially affects both cost and execution if it is not sourced with discipline.

Transparency is essential. VARs are primarily compensated through mark‑ups on the cost of goods sold, yet the structure and application of those mark‑ups vary widely. Some resellers apply a clear percentage mark‑up, while others reduce the OEM’s approved discount—two approaches that can appear similar but produce very different economic outcomes at scale.

Competition at the VAR layer matters. Even small differences in mark‑up methodology can translate into meaningful cost variance, particularly across large or multi‑year purchases. And a crucial best practice is to require explicit disclosure of how the mark‑up is calculated and what it covers, rather than relying on opaque “net of discount” pricing.

Mark‑ups are also rarely uniform. They may vary by country, by OEM, or based on distribution structures. Clear definition is critical to avoid incremental fees for logistics, importation, currency handling, or administrative services that surface after the transaction begins.

For global enterprises, coverage is equally important. Not all VARs can transact locally in every country or are authorized to sell all OEM products in all regions. These limitations need to be assessed upfront to avoid operational friction, compliance risk, and unexpected costs.

A disciplined sourcing approach to the VAR layer preserves the operational benefits of resale while maintaining transparency, control, and predictable economics—ensuring the channel supports, rather than dilutes, the intended commercial outcome.

How TC2 Helps

TC2 supports enterprises across both sides of the technology transaction—the OEM and the value‑added reseller (VAR). Our focus is to make sure the OEM and VAR relationship is working together for your benefit, rather than theirs.

We help clients design and implement integrated commercial and contractual structures that align OEM pricing, terms, and entitlements with the realities of channel‑based procurement. This includes supporting direct engagement with OEMs on the commercial levers that matter most, while ensuring the reseller layer functions as an efficient and transparent fulfilment mechanism.

Where leverage is required, we introduce competition, market context, and benchmark‑backed insight to strengthen negotiations with OEMs. In parallel, we apply disciplined sourcing methodologies to the VAR layer—bringing clarity to pricing mechanics, mark‑ups, scope of services, and geographic coverage.

The result is greater transparency, clearer accountability, and technology transactions that are commercially sound, operationally executable, and durable over time.