In addition, expanding your presence within increasing your company in the Asia Pacific region invariably requires using an indirect approach to using channel partners in some manner or another to support any or all or all. There is a myriad of different ways of attracting as well as enabling the management of your partners, and there are a variety of agreements to choose from, each one well-documented and well-studied. Through our long experiences, see the ones which have proven successful, but unfortunately, there are many that aren’t. After 30 odd years in enterprise, numerous organizations within the IT sector are still struggling with the difficulties of the indirect route for market entry, and nowhere as much as those in the Asia Pacific.
Of course, there are academic names for sure of the most common situations, but we’ve provided a more detailed categorization of the ones we see frequently. Every one of them has something missing from the context.
“Dump and Run” Model
Mr. Vendor is a recruiter for Mr. Channel Partner with the perfect requirements for choosing the right partner. The contract is signed, and the contract signed, hands shaken, and bows are exchanged. The Vendor is handed an assortment of collateral items as well as manuals and CDs and a help desk phone number, and a website address and hops on the next plane to return home, aiming towards the fax machine to take care of the flood of orders. This is obviously a slight exaggeration but not a common approach in the field of partner selection.
Partnerships require both partners to be committed. One part of the pledge is to allow and transfer knowledge and skills while, on the other hand, the commitment to provide competent resources and focus, as well as an agreement on the business plan with continuous review and monitoring.
“Show Me Yours” First.” “Stand-Off” Model
The agreements are in a form in which Mr. Vendor will not provide any information or make any commitments until the Channel Partner first shows some commitment to the cause by hiring dedicated staff and allocating marketing budgets or opening the ‘kimono’ to customers on the list.
Channel Partner Channel Partner, on the other side, is reluctant to spend precious funds or resources until Mr. Vendor has shown an interest in supporting by supplying leads that are qualified or committing to free training or distributing resources to cooperate with the Mr. Channels Partner resources. After a while of waiting for the other to make the initial step and not delivering as promised and expectations, nothing is written, and the partnership disappears as both parties move away to different areas.
“Indirect Is Cheaper” Model
Many people still view indirect channels as a cost-free or low-cost entry into the market with the expectation of massive success. Indirect models in all forms need discounts, infrastructure, and support, which means there are costs associated with this. It is not as accessible.
What is expected from an indirect channel model is a more extensive reach into previously inaccessible markets that have access to domain knowledge and or regional expertise and a better return for every dollar invested. It’s simple, isn’t it? But not for everyone, unfortunately.
An all too frequent example is established and successful companies that decide to move to a cheaper indirect model. This can mean shrinking or shutting down local operations and not creating channel enablement and infrastructure for support or managing expectations of customers. The expectations are that renewals in maintenance and revenue will keep growing, and the business partners keep doing business just as they usually do. The result, as you can imagine, tends to be massive decreases in revenue, the defection of partners, dissatisfaction with customers as well as low morale of staff and even the success of competitors.
The Silver Bullet Model
Many businesses enter markets like the Asia Pacific looking for the “silver bullet” channel partner who has contacts, connections, sales, and technical abilities, as well as the infrastructure for support to market and support their products. It is the ideal choice for the market segment. Naturally, this is the perfect scenario. But what is often not considered is that channels partners (likely larger companies) are the potential to have sales personnel who are paid on gross profit who are already concerned about selling products from multiple vendors and the same goals as every of the other selling force.
Consider the following question What will a salesperson’s focus be? on a brand new, undiscovered product that is difficult to sell with a higher profit, or will they try to meet their quota using what they are familiar with and what is being sold even though their margin could be a bit lower?
‘Committed Start-Up’ Model
In relation to the previous, this seems to be a plausible method. Mr. Start Up Partner will be determined to impress, eager to earn a profit, and committed to the brand, frequently with a particular domain of expertise and a desire to grow their business. All that you could ever need in a sales team. Sometimes. What about the availability of resources and quality? How do you handle the ability to scale? Smaller companies will have to deal with questions like cash flow, connections, breadth of relationships? There are many instances of these well-intentioned partnerships that have gone wrong.
“You Are More Important to Us That We Want You Model
Usually, either Mr. Vendor and Mr. Channel Partner are a recognized brand within their particular market, or sometimes both. The one with the most recognition in the market that the other is seeking access to is the one who plays hardball or, more frequently, the person in charge of the relationship suddenly needs to demonstrate their worth and is a hardball. A relationship that has been characterized by hatred from the beginning was destined for the seemed to be it was a good idea at the moment pile. These relationships have plenty to offer if they are appropriately managed, but they can be difficult to negotiate or manage if one party believes that they’re in the top position but have nothing to gain.
If these scenarios sound familiar … give credit to your channel’s people, and they’ll be rewarded well since your channel is performing well for you and to your mutual benefit.
If any of them appear to be a little familiar, and you’re not sure, then … you have to ask the most critical question is “What is missing from the indirect channels?”
It’s easy to check through the myriad of resources about the ‘6 things’ or even the 12 things you need to accomplish to make channel partnership successful. Also, how to choose your channel partners according to which criteria, or criteria, etc. These will all have solid guidelines. All will contain essential elements you must consider and incorporate into your channel strategy. The majority will focus on aspects such as alignment between the company and sales processes, market segmentation with clear rules of engagement, and the documentation of expectations shared by both parties with regular, transparent communications. Specific channels will require you to assist your channel partner with infrastructure and resources or even providing direct sales support at the stage of enabling. This is all true and essential.
Personally, I prefer to break things down to their most basic level that is a common denominator or two. In this case, there is an actual mental state that decides whether the collaboration will succeed or fail. This is the sole element in the above scenarios that’s not there.
The desire to invest and the ability to support.
Each of these scenarios fails due to the absence of investment. We are not just talking about financial investment. It is about investing in all forms: resources, time, dedication, focus, and finances.
The dump and run model doesn’t have the support and commitment.’ show me yours first” lacks an investment in relationships and building trust. The ‘indirect is more affordable’ does not have investments in many areas, and the list goes on. I’m sure you’ve gotten the idea.
Consider it this way You wouldn’t expect the bank you trust to give dividends or interest even if you’ve got no money put into your account. It’s funny, and a bit worried about speaking with successful and experienced executives who are seeking expansion in the Asia Pacific, actively avoiding investing in their channel development but have high expectations for outcomes. This is not more crucial than it is in the Asia Pacific, a region that is recognized as requiring a robust indirect channel strategy for success built on relationships, commitment, and trust.
The secret to an effective channel partner strategy and an enterprise that can grow and grow year after year is simply an investment plan in line with the return that is required and anticipated. For instance, in areas such as:
– Understanding the market through analysis and segments.
Selection of a Partner in conjunction with due diligence.
o Partner enablement (resource allocation & execution support).
Support infrastructure and management of partners.
Communication, relationships, and building trust.
Regular and targeted reviews.
Like everything, good successful partnerships that are mutually beneficial require focus, commitment, and dedication. There aren’t any short routes, and there’s no cash for nothing. Your results, returns, and profit are directly proportional to your willingness and ability to invest in your channels.