Profitability is a do-or-die proposition for solution providers. If you aren't earning a profit, you're out of business -- end of story.

It sounds simple enough, but in an industry rife with tight margins, fickle customers and constant consolidation, achieving, maintaining and increasing profitability can seem like an elusive goal. The good news: it isn't as difficult as you may think. Consider these questions.

Who are you?
Profitability means different things to different businesses. For large, publicly held companies that are under scrutiny from shareholders and the media, it can revolve around continually growing share prices. For privately owned companies, it often has to do with maximizing the value of the business, either to provide for the future of the owners' families if the business is to be passed down to the next generation, or to ensure a good sale price when the owners are ready to retire. Profitability also can hinge on the types of customers you serve, the breadth of solutions you sell, and whether or not you are currently selling solutions -- which brings us to the next question:

Are you changing with the marketplace?
Reselling hardware stopped being a profitable strategy before many of today's solution providers were even in business. To be financially successful, you must adapt to the realities and requirements of the current marketplace -- expanding into new markets and technologies, reducing your cost of doing business, and generating recurring revenue through avenues such as managed services and proactive warranty renewal. Much of your ability to do this hinges on the partners you choose, so also ask yourself:

With whom are you partnering?
When choosing a partner, your best bet is to look at the picture holistically. Pricing is important, but in addition, you also must consider the breadth of services and support you can take advantage of.

This is where Ingram Micro comes in. Regardless of a business' size or the type of customers it serves, we have tools and resources that can help on the profitability front. Through our Reseller Services Portal and new Ingram Micro Seismic offering, we offer solution providers an easy path to profitable warranty renewals and managed services. For solution providers who want to enter new markets without investing in training or infrastructure, we maintain communities like the Ingram Micro Services Network, which allows its members to instantly increase their geographic reach and technical capabilities. For those who prefer to develop new skill sets in-house, we provide a wide variety of training and education options through regional events as well as our East and West Coast Solution Centers. Flexible financing options are available for solution providers who need extra credit to take advantage of large opportunities. Plus, we can lower costs by serving as a back office, with such services as logistics, drop-shipment management, custom labeling, and billing and collections.

Because profitability is so vital to your success, this issue of the Channel Advisor is devoted to helping you learn more about achieving it. To find out how to increase your profitability by establishing recurring revenue streams, read our cover story, "Recurring Revenue."

If you have additional questions about any of the profitability-enhancing services Ingram Micro offers, feel free to call our sales representatives at (800) 456-8000. Or, if you're not an Ingram Micro customer and would like to become one, visit our web site at www.ingrammicro.com to apply.