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​Has the channel been Naughty or Nice in 2016?

​Has the channel been Naughty or Nice in 2016?

For vendors, distributors and partners, 2016 revealed a few rather hard truths for the local channel.

As Bono once sang “It's Christmas time, there's no need to be afraid”, a lovely sentiment from a time of great giving.

Now, I admire Paul Hewson for what’s he’s done in music and for charity (let’s not talk about the tax thing), however, let’s get real, Bono wasn’t staring at his pipeline through the haze of a lychee martini hangover from last night’s distributor party trying to find ways to make his numbers for Q4.

Tip: I’ve found over the years that the mere act of staring at your pipeline has little impact on making the numbers any bigger but don’t let that put you off as I’ve been wrong about things before.

Add to this the usual vendor revenue recognition and shipping challenges for this time of year for those involved in supplying products that need unloading rather than downloading and it all becomes a little frenetic to close everything out before Australia closes to go surfing.

So, as we start to think about wrapping up another tumultuous year in the Industry and picking which of the vendor and distributor parties to attend, it’s a good time to pause and reflect on the year that was 2016.

I am lucky enough to work with a broad cross-section of the Industry from CIOs in large enterprises to key executives at a mix of partners and vendors and this three-tier perspective revealed a few rather hard truths in 2016.

In the spirit of Christmas, I thought I’d give this a “Naughty or Nice” theme, read into that what you will.

NAUGHTY VENDORS

  • Asking partners to cut their margins to accommodate price pressure from the customer.
  • Continuing with the same outdated partner programs and trying to shoehorn your channel into categories like reseller, integrator, VAR.
  • Continuing to ignore “as-a-service” buying trends and expecting the channel to figure out how to deliver it to clients through financing and squeezing their cash flow.
  • Reaching over quarters to pull deals forward and sacrificing margin in the process. It’s usually a sign of a bigger issue i.e. your eyes are bigger than your belly so to speak.
  • Looking to Marketing every time you have to cut expenses in the quarter.
  • Cancelling your end of year party(s) due to budget cuts.
NICE VENDORS
  • Supporting your partners and sharing margin pain together. And if you’re always discounting like it’s Black Friday at Amazon adjusting your prices to meet the market.
  • Working with a clean sheet of paper on how you will work with Partners moving forward - fortune favours the brave here.
  • Leading every sale with “as-a-service” and aligning commercials and compensation for sales and partners accordingly.
  • Strategically looking at your markets and (re)aligning resources accordingly. The world has changed.
  • Increasing marketing funding and up skilling your teams. In a world of educated and informed buyers marketing is your new best friend.
  • Regardless of the year you’ve had saying thanks to your customers, staff and partners
NAUGHTY PARTNERS / DISTRIBUTORS
  • You exited the year with the same vendors you started with.
  • Continuing to reward your sales teams on $New Sales or Gross Profit (GP).
  • Expecting eDMs and cold-calling to drive sales.
  • Continuing to set unrealistic sales budgets that ignore market trends and momentum and then chasing your tail from Q1.
  • Still using traditional hour or longer face-face meetings for your regular business cadence.

NICE PARTNERS / DISTRIBUTORS

  • You added at least one new vendor and bonus points if it was in Analytics, Cognitive Computing, Process Automation or Artificial Intelligence. If you would like help to drive this process, it’s an area we specialise in.
  • Hiring or redeploying traditional ‘sales’ roles to Customer Service Managers with KPIs for customer retention and customer lifetime value.
  • Increasing your marketing budget to focus on smart content, digital channels and providing insights to your existing and potential clients.
  • Setting realistic sales budgets that recognise the shift in buying behaviours and aggressively driving annuity revenue mix.
  • Adopting best practices in activity based working to help drive efficiency, employee satisfaction and attract Gen Y’s.

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