It’s a question every Chief Sales Officer or VP of Sales has asked themselves. 

 

Indirect Sales Channels offer a compelling opportunity for any company.  Young companies love using channel partners to gain fast access to markets without tying up capital, their most precious resource.  Large companies looking to control costs use channel partners for their maturing products.  Look no further than Michael Dell as an example–realizing that the home computing market had shifted from direct sales (Dell’s previous forte) to retail shops, he quickly signed on channel partners including Wal-Mart. 

 

Channel Program

 

However, in order to establish an effective Channel Management program, we advocate a rigorous approach. Far too many companies conduct Channel Management as an Ad-Hoc program, where Channel Partners are recruited, contracts are individually negotiated, and partners are judged solely on revenue.  This is an inefficient and unscalable practice. Costs associated with these “Chaos” programs are up to 61% higher than their top tier competitors, who have taken the time to establish formal criteria and programs to enable their Channel Partner’s success.

 

Maybe as a manager you’re thinking, “We already have a solid channel management program”.   If you’re nodding your head, ask yourself these questions:

 

Within the last 2 years have you:

 

  • Conducted a thorough review of how the end user purchases your product?

     

  • Reviewed the structure and benefits of your Channel Partner program?

     

  • Changed your structured tier levels and requirements for Channel Partners?

     

  • Updated your product, technical, and sales training resources for Channel Partners?

     

  • Terminated unprofitable Channel partner relationships?

     

  • Conducted a study to determine your most profitable partner relationships?

     

  • Determined how what share of revenue the top 20% of your channel partners produce?

     

  • Analyzed your Channel Partner turnover and reasoning behind departure?

     

 

If you’ve answered NO to any of these questions, it’s likely there are changes you can make to improve efficiency or effectiveness of your Channel Management program.  Download our Whitepaper on the 5 Key Components of Indirect Channel Management here to learn how world class organizations optimize their Indirect Sales Efforts.

 

The Five Components are:

 

  • Sales Strategy: Alignment to the Customer
  • A Defined Partner Selection Process
  • A Partner Focused Recruitment Package
  • Adherence to a Channel Governance Process
  • Comprehensive Channel Enablement Content

 

Channel Management for any organization, is a difficult task.  Partners have hundreds of vendors to choose from, and many great products have failed simply because the vendor failed to put the product in the right place for their key market, didn’t offer competitive terms, or failed to enable their partner’s Sales Force.   Ensure that your product or service doesn’t go to the graveyard simply because you mis-managed its Go-To-Market strategy.

 

Channel Managers, what is the #1 piece of advice you would give to anyone starting from scratch on a channel management program?  I’d be interested to hear your comments below.

 

download-our-channel-management-whitepap

 

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ABOUT THE AUTHOR

Drew Zarges

Helps small business owners overcome their biggest sales and marketing challenges to accelerate revenue growth.

Prior to joining SBI in 2011, Drew worked in the intermediary investment sales world. During that time, he worked his way up the ladder from client service representative to leading and coaching his former company’s sales team on the west coast. At SBI, Drew has served some of the company’s most prestigious accounts as a consultant. For these clients, he successfully executed everything from sales process and lead generation projects to highly technical account segmentation work. He now serves as the General Manager of SBI OnDemand, a unit dedicated to applying the firm’s battle tested concepts and projects to the small business community.

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