Return to main story


Network hardware is easier to buy and set up than ever before--it's pretty much ''goof-proof,'' says Greg Cline, an analyst with Business Research Group in Newton, Mass. But the same can't be said for networking software, which remains dauntingly complex.

Thus, a small army of so-called value-added resellers, or VARs, keeps busy recommending, installing, and servicing entire networks, especially for the 7 million small businesses in the U.S. ''A lot of small businesses try to do it themselves, and then when they can't get it to work, they come to us,'' says Werner Gertje, vice-president of LANPro Business Solutions, a small VAR in Natick, Mass.

There are an estimated 30,000 such consulting firms in the U.S. alone, ranging from one-person shops to outfits with several hundred employees. Most are allied with one or more sellers of networking products, from whom they receive varying levels of training and certification. About half are specialized in vertical markets, such as legal, medical, or retail, while the rest take on any client. VARs used to make their profit from markups on hardware and software. Now, with fierce price competition on basic products from superstores such as CompUSA, their earnings come mostly from hourly fees, typically $100 to $150.

WORD OF MOUTH. Finding and choosing a VAR can be tough for small-biz owners, because there is no centralized listing or rating service. Mostly, customers find help by getting referrals from networking vendors, scanning the yellow pages, or--best of all--via word of mouth.

Before you sign up with a VAR, check references, and don't settle for less than glowing reviews. A good rule of thumb: Match the size of your business to that of the VAR. A big firm may not give your two-person flower store enough attention, while a garage shop could be overwhelmed by the task of wiring a 50-person law office.

The big computer chains are trying to get into the service end of the business, too. With networking gear from the likes of Compaq Computer Corp. and Hewlett-Packard Co., these outlets are selling packages with all the PCs, add-on hardware, and software needed for a network. If you're one of the 30% of small-business owners who have no PCs at all, that's a good way to go. Comp- USA, for example, employs technicians to set up networks at competitive hourly rates. Also, consider this: If you have a branch office in another state, the national reach of a national chain could be a lifesaver.

TAILORED SOFTWARE. If you're adding a network to existing PCs, thousands of VARs can install entry-level software from Microsoft and Artisoft (best suited for up to 10 users) and Novell (for 7 to 25 users). If you're in a specialized field such as dentistry, real estate, or nonprofit management, you may be looking for tailored software packages, which a vertical-market VAR could provide. Ask vendors or your professional association for names.

What about getting help from giants such as IBM or Digital Equipment Corp.? Most of these companies will refer jobs of less than several hundred PCs to local VARs. But local phone companies, including Pacific Bell and Bell Atlantic Corp., have launched soup-to-nuts services for small businesses that will install networks and also hook them up to the phone system. Especially if you're seeking Internet access, consider their solutions.

Picking a VAR ''is like choosing a plastic surgeon,'' says Raymond L. Boggs, an analyst for consulting firm IDC/Link in New York. Simple jobs are suitable for anybody, but if the work is complex--putting your business on the Internet or realigning your nose--you want to get the very best you can find.

By Andy Reinhardt in San Francisco

Return to main story


Updated June 14, 1997 by bwwebmaster
Copyright 1996, Bloomberg L.P.
Terms of Use