Reseller

"Reseller" is the umbrella term for any partner that takes title to a product (or licenses it for resale) and sells it under their own commercial relationship with the end customer. VARs, MSPs, and white-label partners are all resellers; what distinguishes them is what they add on top.

How a Reseller Relationship Works

A reseller signs a reseller agreement with the vendor that grants the right to resell at a discounted "channel price." The reseller invoices the customer directly, collects payment, and pays the vendor the wholesale price — keeping the margin. The reseller typically owns the customer billing relationship, while the vendor still owns the product and its underlying license terms.

In SaaS, this is usually structured one of three ways: (1) the reseller passes through annual subscription billing with a fixed margin, (2) the reseller owns the contract end-to-end and the vendor sees only wholesale revenue, or (3) the vendor bills the customer and pays the reseller a referral-style commission (technically not resale, but often labeled that way).

Types of Resellers

• Authorized reseller — A vendor-approved partner with a formal agreement, training, and access to channel pricing. The baseline.
• Value-added reseller (VAR) — A reseller that bundles services like integration, customization, or training. Higher margin, more customer intimacy.
• White-label reseller — Sells the vendor's product under the reseller's own brand. Common in agency and embedded SaaS models.
• Master reseller — Authorized to recruit and manage sub-resellers in a region or vertical. Functions like a regional distributor.
• Managed service provider (MSP) — Resells the software as part of a managed service the MSP operates on the customer's behalf.

Reseller vs Referral Partner

The legal and commercial structure is different. A reseller takes commercial responsibility for the sale — they invoice, collect, and own the customer relationship. A referral partner introduces a prospect and earns a commission, but the vendor closes and bills the deal. Reseller agreements are heavier (channel pricing, deal registration, SLAs); referral agreements are light.

Real Example: Slack's Solution Partners

Before being absorbed into Salesforce's broader partner program, Slack ran a reseller tier for solution partners — consultancies and agencies that helped enterprises roll out Slack and resold seats as part of the engagement. Partners earned channel margin on the licenses plus services revenue on the implementation, and the customer signed a single contract with the partner rather than dealing with Slack billing directly.

When SaaS Vendors Use Resellers

• Geographic expansion into markets where a direct sales presence isn't economical.
• Verticals or buyer profiles your direct team doesn't have credibility with.
• Procurement environments (public sector, large enterprise) where the customer requires a local or pre-approved vendor of record.
• Embedded use cases where the reseller bundles your product into a larger solution.