Like any marriage – it takes work. Manufacturers/vendors and partners view their relationship from different points of view, but they both agree it’s an essential association.
The View from the Other Side
Manufacturers know that their partners are an important part of their sales channel, but it certainly takes a lot of care and feeding. Partners seem to want everything, and they want it now! The common complaint: they just don’t understand the needs of the manufacturer. And the manufacturer wonders, “how can we plan inventory requirements, if our partners don’t provide projections?”
What about the Partner? The partner feels misunderstood and unappreciated. The common complaint: the vendor doesn’t understand us. The partner laments, “we are on the front line, while the manufacturer is in their ivy-covered tower pontificating about how the market works.”
The term “Partner” has always implied that the reseller and the vendor are working together harmoniously, but sometimes it can be very adversarial. In some cases, the controversy is justified. For example, if a partner has been working on a project for a long time, and an alternate dealer “low-balls” the project with a more steeply discounted price, this can cause a major problem that often damages the partner/vendor relationship. Partners complain that manufacturers must provide some degree of price protection for similar projects.
The reality of the relationship between manufacturer and reseller, is even more complex than you may realize. For instance, changing market conditions can affect the requirements of the vendor/partner relationship. The dealer’s business needs can change and may require adjustments. These are only a few of the important issues to be understood by the manufacturer. In many cases, the manufacturer can help to improve the situation. A good relationship contributes to the success of both organizations.
Communication is sometimes one of the key points in working together. Here are some of the key points to consider:
What the Manufacturer Can Do to Promote Their Partners
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Provide a good communication path with all their partners
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Promote the Partner’s business by linking to their web site
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Provide effective content that the partner can use for their marketing programs
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Help the partner identify various publications that can be used to promote their business
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Provide leads to Partners
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Provide good credit terms that match the realities of the business cycle
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Provide easy to use technical information and support
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Provide project registration and price protection
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Assure that the channel pricing structure is maintained
What the Partner Can Do to Work Well With Manufacturers
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Promote the manufacturer’s brand
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Provide marketing that promotes the vendor’s products
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Provide feedback about hot major prospects
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Provide inventory projections
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Provide pre-sales and post-sales technical support
Why Invest in a Strong Vendor to Partner Relationship?
The Partner is a key part of the manufacturer’s marketing and sales force. They provide first line contact with prospects, they close the sales, provide credit to their customers, provide sales administration, hold inventory, and provide early notification of market changes.
Manufacturers should listen to partners. The marketing feedback they provide is a key to success.. Partner feedback provides the earliest indication of what products are successful and what are not. You can actually see the changing market by looking at the partner’s sales history and by examining what marketing materials they promote. When the partner starts selling at low margins or attempts to broaden their market presence in other geographic or vertical markets, it’s an indication of the changing market. This may be a deviation from the manufacturer’s original channel concept, but it may provide very important market data. The manufacturers should be sensitive to these changes so they can adjust their product planning.
Partners provide gorilla marketing that is very valuable. Manufacturers sometimes must make budget choices about how they advertise. If the partner takes on some of this marketing, they provide an additional resource for the manufacturer. The manufacturer can help with this process by providing marketing services and effective content that can help the partner sustain a regular and consistent marketing effort.
For many companies, investing in their channel marketing efforts has been an essential part of their success. For more information about how other companies have improved their manufacturer to partner relationships, please contact us.