How to Profit as an AWS Reseller
Being an AWS Global Authorized Reseller can be both exciting and overwhelming. AWS offers services that are in massive demand, but you have to make sure your customers know that you can manage it end-to-end for them, and that rapid growth is likely. AWS provides you with a starting base, but you want more; every point increase is significant revenue in your pocket that you can capture.
In addition to CloudCheckr’s comprehensive security, compliance, and automation cloud management capabilities, it offers some key services that enable you to significantly increase your profitability—even to the point of doubling or tripling the AWS-provided base.
A few key reseller services CloudCheckr provides are
1) List Price Translation
2) Bill Re-Rating
3) Service Tiering
This guide will help show you how to increase your profit margins, how to leverage CloudCheckr to achieve results, and the impact each can have on your AWS practice immediately.
List Price Translation
The ability for resellers to purchase EC2, RDS, and other AWS services at a significant discount is possible if you are willing to make a commitment to usage. For reasons such as uncertainty over consistent usage, unease with the upfront cost, and/or uncertainty over restrictions like platform or region, customers often ignore the possibilities. This is an opportunity for channel resellers with linked accounts to step-in, assume the costs and risks of purchasing Reserved Instances (RI), and profit by reselling the capacity. However, to fully capture the margin, the reseller needs to properly recognize whether the customer owns the RI, recast the AWS bill (both Blended and Unblended versions), and display proper pricing to the end customer.
This is where CloudCheckr helps. Rather than manually trying to calculate savings, re-rate the bill, and explain the pricing difference to customers, CloudCheckr users leverage the platform to automatically perform all of these functions. It analyzes RI usage and ownership, properly segregates discounts, and provides users with accurate end user billing dashboards that offer ‘real time’ updates as the month progresses. CloudCheckr will also perform an automatic opportunity analysis with recommendations for you to increase profit. It will even adjust your RI inventory to ensure that you see maximum profitability. AWS Resellers who leverage CloudCheckr and RIs can typically double their AWS margin within the first month.
Resellers are not limited to List Price. Resellers can often craft their own pricing schedules to further incentivize customers and increase margins. For example, AWS’ CDN CloudFront offers users significant discounts if they commit to minimum usage levels. Without CloudCheckr, users who take advantage of these discounts have them displayed to their clients. They are left either forfeiting the entire discount or explaining to customers why there is a discrepancy. CloudCheckr offers a third way: split the discount with the customer and display only the quoted price. Resellers can, thereby, encourage greater service usage while still controlling the pricing information displayed to the customer. Similarly, resellers can use CloudCheckr to re-rate and re-price other services and features. All of this is designed to ensure that the reseller is able to maintain pricing confidentiality and the end-user receives consistent pricing.
Service tiering is a process by which AWS provides progressively greater discounts as usage increases. The net effect is that various services diminish in price as usage increases. Without CloudCheckr, the diminished charges are displayed on the end-users invoice. CloudCheckr, however, will automatically re-price the service as if the account (or account family) is a standalone customer. This enables resellers to charge each customer as if they were using from the first resource. By doing this, resellers are able to keep the profit associated with the aggregated service usage for themselves. This revenue capture can be particularly significant when considering the more steeply tiered services such as Support where the initial charge begins at 10% before tiering down to 3% at higher levels. With multiple small customers, the programmatic adjustment performed by CloudCheckr can add 5% to an AWS reseller’s base margin rate.
CloudCheckr for AWS Resellers
Successful AWS resellers build scalable businesses that capture all available margin. CloudCheckr can help you do that in these 3 key areas: List Price Translation, Bill Re-Rating, and Service Tiering. CloudCheckr also provides many others critical operational tools such as invoicing, budget alerting, and built-in profit analysis.
To learn more, speak to your AWS PDM to learn how to create a profitable AWS business using CloudCheckr’s cloud management platform (CMP) for MSPs and Resellers.