After years of being an executive on the vendor side of the IT industry, I have seen my fair share of vendor partner programs. Now that I have transitioned from the vendor side to distribution, I have had the unique opportunity to not only see firsthand the details of many vendors’ channel programs, but also witness firsthand which ones are succeeding with the majority of resellers. Below is my take on the top 4 most important things to look for when evaluating a vendor’s channel program:
#1: Simplicity and Flexibility
The allure of rebates, incentives and marketing dollars could entice you to sign up for really complex channel programs. But ask yourself – Is it worth the time to sort out all the details, and should you just trust that money will magically appear when needed? Beware that the more complex the program is from the outset, the more complicated and lengthy a process it can be to get your investment back out of said program. Simplicity is key. If the channel account rep can sketch the program out on a napkin, then you are headed in the right direction.
Also, be on the lookout for vendors that are willing to respond to their partners with flexibility in both terms and programs. Vendors that are flexible are usually focused more on the end goal of revenue attainment and less on program regulation. Pick the vendors who are in it to win it – both for you and the customer, and you will find yourself in a true partnership. When the vendor is focused on helping you win deals and not on fighting you on the small details, you both win.
#2: Minimal routes to market
This point is not rocket science – the more ways a customer can get product – the more conflict you as a partner will run into when it comes time to purchase. Vendors that have a direct sales force can typically be more concerned with winning the deal than the partner relationship and can flip deals with pricing discounts at the last minute. Additionally, if the vendor you are considering also OEMs equipment through other vendors, evaluate their market differentiation to ensure that you will not have to compete head to head with the other vendor’s channel. And finally, if a vendor is channel-friendly, they usually offer some form of deal registration, but that too can come with caveats. Take a close look at the rules and make sure that they have simple, clear guidelines that are adhered to – we all know it doesn’t matter how good the registration discount is if your deal gets taken away! Bottom line: Make sure to evaluate the ways a vendor goes to market as well as how they handle pricing through their channel in order to ensure that you can win deals and make money in the long run.
#3: Execution and consistency
Does the vendor do what they promise? Do they provide basic tools for you to succeed? Do they treat partners fairly and with consistency? During the vendor evaluation process, build in time to ask questions, talk with other partners, and ask to review their sales and marketing toolkits. A little time upfront can do wonders in ensuring that you partner with a vendor that will make you look good in front of your customers.
#4: Margin first
Lastly, but most importantly, look for margin first. Many vendors pack a lot of stuff in the channel program trying to make it more attractive to partners. Most of you resellers are already experts at this, having long ago become translators of channel program documents and being able to spot the stuff that leads to revenue from the marketing fluff. You know the drill: deal registration discounts compared to average selling price with a factor of routes to market. It can get complicated. However, some vendors are choosing to make it less difficult to evaluate margin – some are guaranteeing it. Be on the lookout for those vendors who are putting the resellers first and taking the complexity out of the equation. They are out there.
Do you agree with my insights? Did I miss anything? Looking forward to your feedback on this topic, and I hope that these insights make it a little bit easier to evaluate your next vendor.
Charles Bass, VP Business Development, Promark Technology
Submitted on behalf of Dot Hill Systems www.dothill.com
Promark Technology is one of the premier value added distributors (VAD) in the United States focusing on distributing data storage and electronic document imaging products and solutions while also providing VARs the opportunity to offer its clients installation, implementation and support services through the Promark Professional Services Division. Promark also provides various federal and state contract vehicles including the GSA Schedule which its channel partners can leverage to sell to the government.