Have you heard of white label reselling? If not, then know this – there are companies out there, online, that offer digital marketing services that are not designed to be sold to retail end-customers. These services are designed to be sold to businesses and individuals who then resell them to the end-customers. The fantastic thing about reselling is the price difference between the white label wholesaler and the retail end-customer can be tremendous, making white label reselling a tremendously profitable business to be in.
A Day in The Life
White label resellers run their agencies. They solicit prospects, conduct sales presentations, and sell services directly to organizations, businesses, and individuals.
A typical day in the life of a white label reseller revolves around reasonably specific business functions such as email marketing, sales presentations, cold calling prospects, fielding client support calls, talking to their service providers, and more. Noticeably absent from these daily tasks is anything extremely technical – because it’s not part of their job description.
Resellers aren’t developers despite running an agency that may well sell a wide variety of highly technical solutions. Resellers are not only not developers; they are the exact opposite of developers – developers may sell, but salespeople, on the other hand, never code, nor is this a disadvantage. Running a reseller-based agency has numerous advantages over running an agency that does in-house development work.
The first significant advantage resellers have is that they have dramatically lower overhead and operating costs. With a conventional in-house development model, the agency has to carry the costs of paying expensive, highly skilled developers, and the agency needs to keep them busy with work or else, they idle and it’s a waste of resources. There is no such waste of time or money; you pay for development only when development is needed – and nothing more.
A second advantage related to lower overhead costs is the cost of scaling. With a conventional in-house model, your business can only scale to accommodate so many clients before you have to hire more staff. This usually leads to increases in service pricing to end-clients as businesses increase vertically rather than horizontally. When you’re a reseller, you don’t have any added costs for scaling or minimal costs.
At Rocket Driver, our SEO, Social Media Management, Omnichannel Digital Ads, Business Listings, and Reputation Management (ORM) services are all managed services. With managed services, we handle the setup, implementation, and support for end-clients, meaning that our resellers are free to scale all they wish and incur absolutely no overhead penalty or added costs whatsoever.
In this industry, it is generally not the rule that services are managed – most are, in fact, unmanaged. With unmanaged services, there are added costs due to the additional support they require. Support costs can also be incurred by having a more extensive client base and the need for the reseller to handle the setup and implementation themselves. Unmanaged services also usually limit the scope of their salesforces role in the sales process, as they are typically unable to handle setup and implementation themselves.
One other significant advantage of reselling is the ability to have a much more dynamic service set. With in-house development, service sets are limited by the capabilities and talent of in-house staff. Control is, of course, greater when you handle development in-house; however, what can be fielded is always invariably limited. You might have a sensational staff at graphic design, yet without the ability to leverage this advantage in web development, it limits any benefit this might give you.
With reselling, you are free to pick and choose what to resell. You can find the precise services your business wishes to sell and piece together a set of services that apply to either give a specific niche advantage to a select type of client OR you can set up a service set that applies widely to the largest possible swathe of clients. It’s up to you and how you creatively cultivate your offerings.
Building A Salesforce
One major factor in the limitation of the in-house type of agencies that don’t exist for reseller type of agencies is the ability to have a large and robust salesforce. With in-house development, there always exists an axis of marketing/sales and growth. Marketing seeks to obtain prospects and is confined by budget and sometimes geographic location; sales are relatively unconstrained but limited by the flow of leads and the pace of development. Development limits sales because development has to be involved in the quotation of every service that goes out the door. The fact developments limited time has to be maximized in terms of what end-clients are paying. You cannot sell development for less than it costs to do a project.
Sales Mean Profit
All business is sales; this is true now and has always been true. A company makes money only when it sells a product or service to a client, and they pay for it – period. So businesses in this industry make money when they sell services, and they lose money when they fulfill their obligations and have to spend their time and money to do so. This makes the equation very simple – more sales mean more money, more development means less.
A significant operative change occurs when an agency switches from an in-house development-driven organization to a marketing and sales-driven organization. Resellers can focus their daily grind around pure business – sales, marketing, meetings, etc. Most in-house shops’ daily grind revolve around development; they spend their time chasing down revisions and making changes to ongoing projects – not selling. This operative difference is a big one, and though few numbers exist to quantify it, most who switch from dev house to sales organization see the difference in dollars and cents.
Never Turn Away Business
This brings us to another significant advantage resellers have – they can monetize clients that traditional in-house development agencies cannot. The fact is the marketplace for digital marketing and developmental services are humongous, with many projects falling into the middle and bottom of the market stack. Most in-house development agencies with their high-overhead costs cannot monetize projects below a particular size/scope and price. Not being able to monetize smaller clients means turning away lots of business.
Imagine for a moment if the overhead cost of a development agency puts their pricing up to such a tier that they must charge 2500.00 minimum for a simple 5-page website, it means perhaps as much as 50% of the market cannot afford them. Imagine that same development agency had an excellent white label service provider charging 400.00 for that same site without any overhead. It means they could walk away from profitable selling for dramatically less. This, of course, becomes even more exaggerated as the size of the project increases. If a business is profitable at the bottom of the market, it will be much more profitable selling at the upper tiers.
Reselling is profitable to such a degree that it doesn’t take as many clients or as large of clients to make a reseller-driven agency productive. This is manifestly obvious when looking at the types of agencies that resell services and how they operate. Many run their agencies from home offices, and they run just fine, bringing in plenty of profit while running a slow burn.
Freedom is another intangible benefit of being a reseller overrunning a conventional agency. When you’re a reseller, you’re free to run your business the way you see fit without being tethered to a traditional corporate structure. It’s possible to be a reseller all by yourself without partners, employees, or even contractors. Many who resell have no partnerships and work through a single vendor.
For example, here at Rocket Driver, we have many partners who run their agencies from their homes or small offices where they combine services from us with their other businesses. We also have full-time corporate-style partners, and reselling is a side hustle for them; they sell a client here and there and make substantial money only reselling on a part-time basis.
Conclusion
White label reselling means different things to different people. For those who resell services on a full-time basis, reselling represents the gateway to their career. For those who resell part-time, reselling means a way to make extra money without the hassle.
If you’re interested in learning more about becoming a white label reseller, then check us out; we’ve been in this industry for the past ten years and have helped thousands of entrepreneurs and agencies to engage in developing their businesses successfully.