The Reseller’s Dilemma: Shrinking Margins on Dropbox & OneDrive. What’s Next?
How MSPs Can Stop Losing Margins on File Sharing? | Many MSPs lose profit by reselling file sharing tools like Dropbox or OneDrive. Learn how to keep margins high with white-label, secure alternatives.
Resellers and MSPs have long relied on well-known cloud tools like Dropbox and OneDrive to meet client needs. These platforms were easy to sell, carried strong brand recognition, and gave partners a chance to build recurring revenue.
But things have changed. Margins are shrinking, partner programs are tightening, and resellers are left with less control over pricing, branding, and even customer relationships.
For many, the big question is simple: what comes after Dropbox and OneDrive?
Why margins are falling
Large vendors attract resellers with the promise of growth, but over time the model starts working against you.
- Low reseller margins → Partners often see only 10–15% per license, while the vendor takes the rest.
- Direct vendor sales → Vendors run their own sales campaigns, targeting the same businesses you are trying to support.
- Little pricing control → Discounts, bundles, or custom terms are often not in your hands.
The result? Resellers do the heavy lifting of finding and supporting clients, but much of the revenue flows back to the vendor.
The control problem
Beyond shrinking revenue, resellers also face limits on control and flexibility:
- Branding → The vendor’s name is always in front of your customer, not yours.
- Data location → Clients in regulated sectors (finance, government, manufacturing) often ask where data is stored. With hyperscalers, you rarely decide.
- Support → If something breaks, your team is stuck between the client and the vendor’s helpdesk.
This lack of control makes it harder to stand out from competitors or prove long-term value to customers.
Why clients are asking for alternatives
It’s not only resellers who are questioning the big names. End clients are increasingly asking for more:
- Data sovereignty → Construction firms, governments, and banks want files stored locally or on trusted servers.
- Compliance → Healthcare, finance, and manufacturing clients need solutions that support industry regulations.
- Simpler migration → Many are tired of complex vendor lock-in and want easier ways to move files without disruption.
These concerns open the door for resellers to offer something beyond the standard “Dropbox license.”
The alternative: white-label file sharing with RushFiles
This is where White-label File Sharing and Enterprise File Sync and Share solutions come in. Instead of reselling a vendor’s name, you can sell your own branded service.
With RushFiles SaaS or On-Premise deployment, you choose how to deliver the service:
- Keep full control of pricing and margins
- Decide where data is stored (your infrastructure or ours)
- Put your name and logo on the platform, not someone else’s
- Own the customer relationship from start to finish
This model lets you move from a small cut of the pie to building a long-term recurring revenue stream with full control.
Use cases where resellers win
Resellers already use RushFiles to support industries where Dropbox and OneDrive fall short:
- File Server Replacement → Modernize legacy systems without disrupting workflows.
- Secure File Sharing and Sync → Meet compliance needs in finance, healthcare, and government.
- Construction, Manufacturing, Government, Finance → Industries where control, compliance, and branding matter most.
These are the clients most likely to ask for alternatives, and most willing to pay for solutions that fit their requirements.
What’s next for resellers?
The reseller dilemma is clear: stick with vendors that control your margins, or take back ownership of your business model.
By moving away from Dropbox and OneDrive, resellers can:
- Protect margins and increase recurring revenue
- Build stronger client loyalty with their own brand
- Deliver real answers to industries that demand security and compliance
Want to grow beyond shrinking margins?
Discover how RushFiles helps resellers move from license reselling to full control with white-label file sharing and secure EFSS solutions.