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  • When channel partnerships go wrong

    Posted by Jacqui Rand November 12, 2018 160 views - 2 comments - 0 likes - #partners  #Channel partners  #IT partnering  #partner to partner 


    When channel partnerships first form, they do for all the right reasons, with two parties coming together to share complementary products and skillsets, each helping to boost the other’s reach and market share. But all too often, the reality is far from divine. One partner may feel the other isn’t pulling their weight, or worse, going behind their back. And once trust is in doubt, in can be very difficult to revive it.

    There are all sorts of reasons why partnerships may not work as well as they should, or even break down altogether. Here are a few things to consider with any type of channel partnership which could help you avoid a descent into partnership hell.

     

    • Understand your relationship with your partners

    It may seem obvious but each case is different. Is your partner using you because of a historical deal they haven’t bothered to question? Or are you a relatively low-priority addition to their catalogue? Is it an equal partnership or does one party hold all the power? Taking a full, clear-eyed understanding of the purpose and the benefits of your partnership for both parties will go a long way towards anticipating potential problems down the line, or highlighting issues that exist today.

    • Set clear boundaries on customer targeting

    Be clear and transparent with one another.  It is likely that you and your partner are working in a similar field, and you’re supposed to complement each other. But that doesn’t mean your sales teams won’t cut out the middle man, not communicate or tread on each other’s toes from time to time. If possible, it helps to have an official written agreement on what each of you can and can’t do, even if it’s not legally binding and more in the nature of a ‘gentleman’s agreement’. But it sets out the rules of engagement and should be transparent to all parties.  Between vendors and their channel partners this becomes more complex, but it is critical to get right so decide on regional boundaries or provide clear customer segments that your partners (or you) shouldn’t touch.  

    • Treat your partners equably

    It’s only natural that people in a similar sector talk to each other. And they will know who is selling what product at what price and if one partner has received a better discount or deal.  If you’re relying on keeping cheaper deals a secret, you’re on a hiding to nothing. Deals that have an element of services embedded are harder to unpick and offer a greater opportunity for margin and differentiation for your partners. 

    • Review your partnerships regularly

    Inking a partner deal and then just carrying on with business as usual is a sure way to lead to a short-term partnership. Quarterly meetings offer a good space of time for you to review the relationship, bring up any issues and outline ways forward. And if fundamental problems come up, revise the contract by mutual agreement and negotiation.

     

     
     

  • 2 comments
    • Graham Bunting
      Graham Bunting There is a lot to get right when it comes to channel partnerships and unless you have considered every eventuality, there is usually a gotcha or two waiting for you down the line. Channel conflict is an often underthought issue and this can be channels...  more
      November 12, 2018 - 2 like this
    • Jacqui Rand
      Jacqui Rand Thanks Graham - I agree it is a complex issue even for smaller vendors with a mixed model
      November 13, 2018