From dealing with conflict between competing channels to implementing fair pricing policies, in the world of the international channel manager, there is never a dull moment. With ever-increasing complexity in the relationships that suppliers have with their various channel partners, it is often difficult to establish rules and practices that can be applied universally.
Having said this, there are some fundamentals that never change and 5 of the most common pitfalls that we’ve encountered in 25 years of developing sales through channels are as follows.
Effective Channel Development Tip 1 – expect the channel to take a business risk that you would not be prepared to take – many suppliers feel the channel should be prepared to takes risks (carrying inventory, extending warranty, providing customer credit, for example) that the it would not be prepared to take in that market. If it’s not an acceptable business risk for you, the chances are, it’s a bad choice for your channel partner as well.
Effective Channel Development Tip 2 – Remember that the end-customers are the channel’s, not yours. The reason you’re using the channel in the first place is because it has relationships with your target customers. The day you damage the channel’s relationship with its end-customer or try to take it over, is the day the channel stops trusting you as a supplier.
Effective Channel Development Tip 3 – Maximise face-time – in the electronically-connected world in which we live, it’s easy to replace face-time with conference calls, eLearning, eMail and social-media messaging. But people are still people and the especially where there are language and cultural barriers, the importance of meeting people and braking bread with your partners has never been greater.
Effective Channel Development Tip 4 – Know the people in the partner company that succeed by selling your products. It’s not enough to deal with the senior management; make sure you understand which people in the channel get a success when your products or services sell. Then build relationships with them. They’re the individuals that will make or break your business in the long-run
Effective Channel Development Tip 5 – Demonstrate unswerving loyalty – like any partnership, a channel relationship depends hugely on the trust that exists between the two people responsible for its day-to-day functioning. Break that trust once and it’s almost impossible to rebuild. So, don’t make promises your organisation can’t keep and never let the channel find out about your plans for its market from a third party.
All of these are common-sense, but we are constantly amazed at the number of times exporters infringe or ignore the basics.