While everything is rosy now—the big hitter continues to knock it out of the park, the guy from the minors finally came up and closed a couple deals, and a seasoned veteran put together another solid quarter—partners change.  When your firm first started, you probably had a different set of criteria for your Ideal Channel Partner than you do today.  Channel Partners change as well; their core competencies and customers are constantly shifting. This is the natural evolution of business.

 

What is unnatural, (and far too common) is speaking with a Channel Manager and finding that over 50% of their current partners have no wins over the last four quarters.  Sure, everyone occasionally goes into a slump. But if the forward looking indicators (Opportunities in Pipeline, New Registrations) show a similar decline, chances are your Channel Partner is refocusing its efforts or on its way out.  Every good Channel Manager should develop a scorecard to help monitor their Channel Partners.   This should reflect both the Vendors’ commitment (Leads Given, Marketing Dollars Contributed) and the Channel Partners’ (Leads Registered, Rep and Engineers Trained).  By having a clear Vendor-facing scorecard, your conversations with Channel Partners will be more productive and candid.

 

Download a Sample Vendor Scorecard Here.

 

Sample Channel Partner Scorecard

 

Don’t be scared to bring up the possibility of partnership termination.  In the end, you’ll be able to devote more attention to your best customers, and allow the partners who struggled to sell deals the chance to work with a different product more suited for their customers.   Besides Revenue and Pipeline Slowdown, Here are Other Reasons to Sever Ties:

 

  • Goal Change: Your Vision of the Product or Your Partner’s Vision Are No Longer Congruent.
  • Top Level Involvement: When Management at The Channel Partner Indicates that Your Product is No Longer a Focus Going Forward.
  • Product Sunset:  Your chief product at the Vendor will no longer be supported.
  • Support/Service:  Your partner has consistent implementation/service issues that are impacting the reputation of your firm.

 

It always surprises us that laggard/underperforming Sales Reps are let go on an annual basis, but aging Channel Partners are allowed to fester under a channel manager.  Even if they do get a quality lead, they probably aren’t familiar enough to sell or implement the product to your company’s standards.  As part of your Channel Management strategy, ensure that your Channel Partners and Marketing Dollars are going towards the companies committed to your product.  Make sure your channel managers are managing the best partners.

 

Channel Managers — Any good stories of a time when you realized it was time to rid yourself of an unprofitable partner?  How did you proceed?  What was the lift?

 

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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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