The Software as a Service (SaaS) industry is growing like crazy right now, thanks to businesses relying more and more on cloud-based tools. Think about all the software we use today to manage projects, analyze data, or even keep customers happy—those are all powered by SaaS.
And while SaaS providers deserve credit for creating these amazing tools, resellers are the ones helping bring them to more people and businesses around the world. So, you might be wondering: what exactly are SaaS resellers, and why do they matter? Even better, what are all the types of SaaS resellers, and how do they work?
If you’re a SaaS provider trying to grow your user base or an entrepreneur thinking about diving into this space, understanding the reseller models is a game-changer. In this guide, I’ll walk you through everything you need to know—breaking down each type of SaaS reseller and what makes them unique. Whether you’re just exploring the idea or already neck-deep in the SaaS world, you’ll leave with a clear picture of your next steps.
What are the different types of SaaS Resellers?
A SaaS reseller is a company or individual that shares their SaaS provider’s software products while selling and delivering them. SaaS resellers are much different than the traditional retail or distribution channel: they’re more inclined to digital-first strategies, often offering subscription and value-driven services.
How SaaS Resellers Fit Into the Market
SaaS resellers play a unique and essential role in the software world, and here’s why.
First, they bridge the gap between software providers and niche markets. Providers are usually busy focusing on building and improving their tools, so they don’t always have the time or resources to target every industry or small business out there. That’s where resellers come in—they connect these amazing products with customers that might otherwise get overlooked.
Then there’s the personalized touch. Resellers often offer additional services, like support, training, or consultations. It’s not just about selling a subscription; it’s about making sure customers succeed with the software. People appreciate that extra care, and it builds loyalty.
Finally, here’s how they make their money. Most resellers earn their share through commissions, recurring revenue, or direct profit margins. It’s a win-win—providers get broader reach, customers get excellent service, and resellers generate income.
Reseller vs. Partner in SaaS
It’s easy to mix up "reseller" and "partner" when talking about SaaS, but there’s a subtle difference between the two.
A SaaS reseller sells it as a product and is hands-on. They sell the software themselves, manage their relationship with the customer, and treat it as their own. The model is a simple case where they spend most of their time bringing deals over the line and making sure the software fits the customer’s requirements.
In contrast, channel partners play a bigger role. They work with SaaS providers, but their integration goes much deeper than that. It might involve marketing support, consulting support, or even add-on services that support the application software. They’re thinking of the provider as using kind of arms to grow the product reach on multiple fronts.
Benefits of Partnering with SaaS Resellers
Partnering with SaaS resellers can be a game-changer for both the SaaS providers and the resellers. When both sides work together, they get to tap into each other’s strengths and grow in ways they might not be able to on their own.
Benefits for SaaS Providers
Extended Market Reach: Resellers give SaaS providers the chance to reach markets or industries that might not be part of their direct focus. For example, a reseller based in a specific country can localize the product to match the needs of that region, making it easier to market and sell in ways that a provider might not be able to do directly.
Cost Efficiency: It’s expensive and resource-intensive to build and manage a dedicated sales team for every market or niche. Rather than spending up front, providers can grow without leveraging their budgets or resources, as resellers can manage the sales and customer management on a shared revenue model.
Improved Customer Experience: One of the biggest advantages of working with resellers is how they can personalize the experience for customers. Whether it’s providing tailored demos, offering niche-specific solutions, or simply offering local support, resellers bring that personal touch that can make all the difference when trying to gain customer trust and satisfaction.
Faster Time to Market: Resellers is a good way for providers to cut certain skip steps in building out a new market — regulatory compliance, set up infrastructure, etc. — by using the prior knowledge and existing network on the part of the reseller. The good thing is it’s a faster process to expand globally.
Benefits for Resellers
Recurring Revenue Models: One of the biggest draws of being a SaaS reseller is the recurring revenue. Since most SaaS products use subscription-based pricing, resellers benefit from a steady stream of income as long as their clients continue subscribing. It’s like building a long-term business with consistent cash flow.
Low Overhead: Unlike other businesses where you have to invest in creating products or services, as a SaaS reseller, you don’t need to build or maintain the software itself. You get to focus on what matters—marketing the product, managing relationships with clients, and making sure the customers get the most out of what you offer.
Brand Affiliation: When you work with well-known, trusted SaaS providers, their reputation rubs off on you. Being aligned with these reputable brands gives you instant credibility in the market, and customers are often more willing to trust a name they know, especially when you provide them with great support.
Scalable Opportunities: The SaaS industry is on fire, and it’s only getting bigger. It’s projected to hit a staggering $720 billion by 2030. For resellers, that means endless opportunities to scale up and grow, regardless of your niche. As the industry expands, so do the chances to take part in that growth.
The Main Types of SaaS Resellers
There are several types of SaaS resellers, and each one has its approach to how they distribute and sell software. Let’s break them down so you can see how they differ and which one might be the best fit for you, whether you're considering becoming a reseller or just looking to learn more.
White-Label Resellers
White-label resellers work a bit differently. They buy SaaS products, rebrand them to fit their own business, and then sell them as their products. It’s all about branding and customer ownership. While the reseller focuses on creating the brand experience and managing customer relationships, the SaaS provider takes care of the behind-the-scenes stuff—the technology, updates, and infrastructure.
How It Works
Here’s how the whole white-label reseller process works:
A white-labeled SaaS product is where one SaaS provider relabels their software product and sells to others.
Taking that software you are a reseller making it your own and putting your own logo, design, and company name to brand it. In essence,e you make them look like your own product.
From there, it’s all up to you. You market and sell the software, providing customer support and managing relationships with your clients while the SaaS provider handles the backend tech side.
Advantages
There are a few key advantages to being a white-label SaaS reseller that stand out:
Full Branding and Ownership – You get to own the branding completely. The software might come from someone else, but once it’s rebranded, it’s all yours to market and sell as you see fit. This means more control over how you present it to your audience.
No Need for Technical Development or Maintenance – You don’t have to worry about building or maintaining the software—that’s all handled by the SaaS provider. This means you can focus your energy on growing your business and handling customer needs instead of spending time fixing bugs or developing new features.
White Label Reselling in Niche Markets – Because you can customize it specifically for each industry or market, this type of reselling allows you to ramp up to the point where you become a hot commodity in your niche. This means that you’re not starting from scratch on product development.
Value-Added Resellers (VARs)
VARs are a little different from suppliers in that they add value. They don’t just peddle SaaS on its own. Instead, they wrap additional services or even the hardware to add value to the product for their customers.
If you are selling CRM software that, on top of it, provides setup assistance, training, or integration with other systems to further help it work for your customers, what would that translate into? That means we have an additional layer of support that allows for more robust and specific to individual business needs.
Key Features
Here are a few key things that make Value-Added Resellers (VARs) stand out:
As a VAR you can offer your customers customized solutions. With these types of software, you can adjust the software so it meets their specific needs, be it adjusting features or setting it up to play nicely into their business.
Bundling – A big part of the VAR business is bundling services such as support, consultation, or even training. You’re not giving them a product, you’re giving them a package that includes everything they need to make the most of their software.
Grower packages – Other VARs pack software with complementary products (hardware and other tech solutions so the full package is ready for the client right out of the box — typically goes well with hardware.
Advantages
Being a Value-Added Reseller (VAR) comes with some great benefits:
It Increases Perceived Value – When you create custom services or integrations, it is not just about selling software – now you are also selling a solution. This can contribute greatly to making the perception of value of the SaaS product much higher than merely the standard offering, so creating a package to satisfy those who are looking for more than simply the core software.
VARs have a huge advantage to the Enterprise Client – If you’re targeting enterprise clients. These clients often seek complete turnkey solutions that give them everything they want, all right out of the box. With this type of value, you’re creating yourself a one-stop shop for all of their needs.
Bundled Packages & Added Services – Since these are sometimes included with making the sale to the VAR, they can help result in higher profit margins. Because you’re actually helping people with something, something more than just software, you can charge a premium for the total solutions you provide.
Managed Service Providers (MSPs)
Managed Service Providers (MSPs) do the work in a much broader sense of tech. MSPs don't just sell software — they offer a complete range of IT services and usually layer in SaaS products to further extend their offerings.
If you’re an MSP, you probably manage everything from cloud, infrastructure to security so businesses’ IT systems keep running thru. For example, SaaS products become part of the package where the clients get the tools they need, and the MSP takes care of the maintenance, support, and updates of those tools.
Characteristics
One unique thing about software is that when you use them your Managed Service Providers (MSPs) offer you something more than just that software. Here are a couple of key characteristics that define them:
Give Your Focus to Subscription-Based IT Support – Guess what, MSPs are subscription-based, so you’ll operate within a subscription model, where you charge your business a recurring fee for access to your ongoing IT support. It keeps the revenue steady and pays it to clients every month, it keeps them always getting proactive help when they require it.
Services That It Includes Include Cybersecurity, Data Management, Cloud Computing – As well as SaaS, MSPs include services such as cybersecurity, data management, and cloud computing. They make you sure businesses have got a full, safe, and optimized IT environment so that everything keeps on working fine.
Differences Between MSPs and SaaS Resellers
While both Managed Service Providers (MSPs) and SaaS resellers work with software, their roles are quite different:
MSPs – Scope of Service – selling software isn’t the whole story; it’s managing the whole IT ecosystem for their clients. They handle everything related to running a business’s IT systems – from data management to cybersecurity. SaaS resellers only sell software products, and they usually don’t worry about the IT needs of the whole business.
Customer Retention — For MSPs, it’s not just about getting to ‘yes.’ On the other side, they want to establish ongoing long-term relationships by providing managed services. They look after clients to provide continuous support and maintenance, thereby increasing retention rates. In the case of SaaS resellers, however, the sale is more of a center focus with customer retention often dependent on how well the product works.
Referral Partners
Referral partners operate a little bit differently. Referral partners don’t create, resell, or manage the SaaS products, they create and generate leads for SaaS providers. To put it in simple terms, they are potential customers, whomever reference partners call and when that lead or potential customer becomes a successful sale, then the referral partner is paid a commission.
How They Work
There is no need for referral partners to worry about handling software or even completing actual sales. They instead concentrate on generating interest and referral.
Picture them as matchmakers between prospects and the appropriate SaaS products. For once they make that connection and the deal closes, they earn a commission. Doing review sites is a low-effort way to make money without putting too much into getting involved in the day-to-day nuts & bolts of running the learning product or how to sell it.
Benefits
Being a referral partner comes with its own set of perks:
Low Operational Overhead – You do not need to worry about software handling or dealing with customers – nothing to maintain. You lose the heavy lifting with this model and as a result have lower operational costs. Taken together, it’s a simple model: connect the right people and collect your commission.
Depending on the SaaS provider, you may receive access to Recurring Commissions (i.e. commissions for bringing a customer in, then every month thereafter), or Time Payments (i.e. one-time commissions for a deal to close). The thing is, if you can find clients who stick around then those recurring payments can become a solid stream of income.
Affiliate Programs
SaaS affiliate programs work similarly to referral partners, but with a key difference: They usually promote a product through online mediums, such as blogging, YouTube, social media, and email campaigns.
Unlike what you’d get from word of mouth or direct referral the affiliates go ahead and make the content that revolves around the software trying to teach and beckon to the possible customer in a slightly indirect way. If you have some experience and already have an online presence, it is a good option to make money with your content, driving traffic, hence, to SaaS products.
How SaaS Affiliate Programs Work
SaaS affiliate programs are pretty simple. Referral links are used by affiliates to promote the SaaS products there. These tracks tell you who’s clicking through and buying.
The affiliate gets a commission every time someone buys or signs up with the service via the affiliate’s link. It is a performance-based model, meaning for your money you only pay for a result, not for just sending traffic or generating interest.
Advantages
SaaS affiliate programs have some pretty sweet benefits:
Easy Entry for Individuals or Smaller Businesses – You don’t need a big team or deep expertise in sales to get started. If you’re an individual or small business owner, affiliate programs are an easy way to tap into the SaaS market without major upfront costs or risks.
Affiliate Marketing Gives Content Creators Passive Income Opportunities – For content creators (bloggers, YouTubers, etc.) affiliate marketing is a passive income opportunity. When you’ve put the affiliate link in your content, you can continue to earn commissions as long as people click and buy through that link.
Hybrid Resellers
Hybrid resellers are a little mix-and-match. These reseller types are a mix of two or more reseller types. As a case in point, a firm could simultaneously function as a Value-Added Reseller (VAR) and a Managed Service Provider (MSP).
Advantages
There are some great benefits to being a hybrid reseller:
Ease to Differentiate and Adapt to Different Types of Customers – Because you use various reseller models, you are free to align your services to the needs of various types of customers. Hybrid resellers can adapt to what their customers are looking for — whether you are providing custom software with value-added service or you are doing IT support and SaaS product sales.
Multiple Revenue Streams – As a VAR, MSP, etc., there are multiple revenue streams available to you. That doesn’t mean that you have to only sell software—you can still make money through service contracts, modified software, and ongoing IT support to help you take advantage of paying customers and diversify your income.
Comparison of SaaS Reseller Types
Understanding the differences between the different types of SaaS resellers is super important. Knowing what each model offers will help you make a smarter decision as either a provider or say person thinking about becoming a reseller.
Key Differences Between SaaS Reseller Models
Understanding the differences between the various SaaS reseller types is essential when figuring out which one fits your business. Each model has its unique characteristics that affect everything from the level of involvement to the revenue structure. Here's a breakdown of the key differences:
White-Label Resellers
Ownership: Full branding control.
Target Customers: Small businesses or niche markets.
Effort Level: They’re high and responsible for rebranding support, and customer management.
Revenue Model: Primarily from product sales.
White-label resellers use the software’s code as they brand the software and provide it to small, niche client groups. With revenue from the product sales, they apply many efforts on marketing, the customer support to others.
Value-Added Resellers (VARs)
Ownership: Bundled enhancements.
Target Customers: Usually, those enterprises require customized solutions.
Effort Level: Beyond being simple (value-added services and customizations are involved).
Revenue Model: Combination of service-based revenue and SaaS sales.
VARs aren’t just software resellers— they provide additional services or features so they create more work when tailoring the software to meet specific client needs.
Managed Service Providers (MSPs)
Ownership: Comprehensive control over IT services.
Target Customers: For small to mid-sized businesses searching for an integrated solution.
Effort Level: GHC Includes: (IT service and SaaS Management is very high)
Revenue Model: Recurring subscriptions from long-term contracts.
The efforts involved in managing the entire IT setup for the businesses for which they sell software makes their services a value add for businesses. More often than not, they provide recurring revenue through monthly or yearly subscriptions.
Referral Partners
Ownership: No ownership of the software.
Target Customers: General SaaS users.
Effort Level: Focused on generating leads, rather than sales.
Revenue Model: Commission-based, earned for successful referrals.
The whole referral partner model is relatively easy, where referral partners essentially just generate leads for SaaS providers, connecting potential customers to the software. They don’t sell the software, they don’t manage or orchestrate the sales process and they don’t get a commission on every successful referral they make.
Affiliate Programs
Ownership: No ownership of the product.
Target Customers: Digital channel discovery by SaaS users through blogs, and social media.
Effort Level: It’s generally low to medium depending on how much you put into promotion.
Revenue Model: Earns commissions from affiliate marketing.
Content is marketed by the software affiliates through their content such as blog posts or social media. A commission is earned by them every time someone clicks through their link and registers or purchases something.
Hybrid Resellers
Ownership: A mix of multiple reseller models.
Target Customers: Varies depending on the approach.
Effort Level: This (depending on the exact model combination) is a Medium to High-level head trap.
Revenue Model: Combines revenue from several streams, like sales and service-based earnings.
Hybrid resellers employ the features of multiple reseller models on a single platform. For example, they can be VARs and MSPs at a time, so they can generate revenue coming from different revenue sources and provide more flexibility to customers.
The Role of Reseller Agreements and Partnerships
Strong well structured reseller agreements are really important in the world of SaaS reselling. They are the basis for any partnership built between SaaS providers and resellers so that as partners, both sides are aware of what’s expected and what’s their part of the expectations.
Key Elements of a Reseller Agreement
A reseller agreement isn’t empty words – it’s the basis of a relationship that will hopefully grow into a serious one. If you’re contemplating building a SaaS reseller business or working with one, you want to make sure your agreement includes some of the following. These elements not only protect both parties but also make sure things run smoothly. Here’s
what should be in the agreement:
Revenue Structure: It’s where you outline margins commissions, and payment timelines. It’s important not to have misunderstandings, so clear terms on how much the reseller will earn on each sale and when they will get paid. Make the payment structure as straight as it can be so everyone knows what’s coming.
Territory Rights: Yet there’s also the question of whether the reseller has exclusive rights in certain regions or market segments. For instance, let’s say that the focus of your efforts is on a particular country or sector, defining geographic exclusivity in that country or industry means that you can avoid competing with other resellers trying to make the same sale to the same customers in the same place. It also enables both parties to get a sense of what they can reach.
Support Expectations: Customer satisfaction is a priority, and clear roles are a must here. The agreement should detail who handles customer support, onboarding, and technical support. This helps ensure that customers don’t fall through the cracks and that everyone knows who’s responsible for what. A quick response time and helpful assistance can make or break customer loyalty.
Marketing Guidelines: It should also define how the reseller can market the product. Maintaining consistency in your message means branding, compliance, and general marketing standards. To get it right and show it off in a professional manner, resellers have to work by the provider's guidelines to represent the SaaS product properly and contextually. You don’t want any of your customers coming from different resellers to be confused or have mismatched expectations or your retention rate will fall.
Best Practices for Strong Partnerships
Building a strong partnership with SaaS resellers goes beyond the technical agreements—it’s about creating a relationship based on trust and mutual growth. Here are some best practices that can help both parties succeed:
Transparency: The foundation of any successful partnership is open, honest communication. Keeping the lines of communication wide open allows both the SaaS provider and resellers to stay aligned on shared goals, performance metrics, and any challenges that pop up. Whether it's discussing sales targets, customer feedback, or growth strategies, everyone should be on the same page. This kind of transparency helps create a partnership built on trust.
Training: Product knowledge is key, and resellers are the face of your product to the customer. Offering thorough training sessions for resellers ensures they understand how your software works and can provide the best possible service to their customers. The more resellers know about your product, the more confidently they can market and sell it, ensuring quality and consistency across the board.
Incentives: This is incredibly powerful when you encourage resellers to put their best foot forward. An easy method to encourage them is to provide tiered commissions or rewards for best-multiplying sellers. It’s a win-win: If it increases sales, resellers have a clear incentive to sell more, and providers realize more sales. Giving them what they want and rewarding them will boost morale and success.
Conclusion
SaaS resellers are a fundamental part of the Software as a Service (SaaS) ecosystem. They bridge the gap between SaaS providers and their customers, ensuring that products reach a wider audience. Whether it’s white-label resellers who rebrand the software as their own or managed service providers (MSPs) who bundle SaaS with IT services, each type of reseller brings a unique value to the table. These models help the SaaS industry thrive and grow.
For SaaS providers, working with the right type of reseller can lead to expanded market reach and an ability to enter new regions or industries. They benefit from the resellers' expertise, local knowledge, and existing relationships with their customers. On the flip side, resellers have the opportunity to tap into growing industries and capitalize on the increasing demand for SaaS solutions without the need for software development. They build sustainable businesses by offering valuable products with minimal overhead.
FAQs
What are the benefits of becoming a SaaS reseller?
As your SaaS reseller, you get recurring revenue, less overhead, and work with trusted brands to build credibility and bring in customers.
Which SaaS reseller type is best for small businesses?
Managed Service Providers and white-label resellers are good for SMBs as they provide branded services without the need for technical headaches.
Can SaaS resellers work in multiple industries?
Yes, SaaS resellers serve industries like healthcare, finance, and education with customized products and services.
Do SaaS resellers need technical expertise?
Technical expertise depends on the model. VARs and MSPs usually need deep IT knowledge, while referral partners and affiliates don't require much technical skill.
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