Column: Channel Coach – Building Partnerships

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Editors Note: This is the first of a bi-monthly series of articles designed to build successful businesses through the effective use of channel partnerships. Starting off this month, we will discuss proven methods for finding the right partner for your business.

Youve decided that the best course of action for your business is to become a sales agent or channel partner. While an important first step, this is just the beginning of an ongoing process that can make or break your business. Finding the right partner impacts your chances for success and provides you with the opportunity to accelerate your growth and revenue. Much like a marriage, choosing your partner is challenging and hard work, requiring self evaluation, research, comparison, trade-offs and finally just plain old gut feel.

Start with a self assessment for your organization and answer the following five questions. Note your answers and be as candid as possible about your business.

1. What size customers does our organization have now or would like to pursue? Profiling your current customer base will tell you a great deal about the types of clients you have been successful acquiring thus far and will yield clues as to other customers that may be good targets. By profiling your base you should be able to see a pattern emerge as to whether your customers are SMBs or larger enterprises. decide which segment will be your primary focus and identify partners who would be the best at helping you pursue it.

2. What markets is our company most comfortable working in? This question helps identify the industries in which your company has been successful. For example, do you have customers in professional services (lawyers, accountants), real estate, manufacturing, or banking? And how is your company solving their problems?

3. What are our strengths and what areas do we need to improve upon? Using this question helps you to begin evaluating your organization and its skill sets. do you have a recognized brand in your markets; do prospects know who you are and what products or services you provide; or do you need the power of a bigger brand from a well known partner? Are you and your staff good prospectors or do you need to depend upon your partner for sales leads? Is your staff technically competent or do you need help and training in this area?

4. What do we want or need from our service provider? Using your answers to these first few questions, you now can begin developing a list of your requirements from potential providers. Ideally, you will begin identifying the must haves from your provider to help fill the gaps in your product and service offerings. Equally, if not more, important is to partner with a provider that can provide excellent support. Given the choice between higher commissions and greater support, our recommendation is to ally with the partner that offers the greater level of support, especially if you are just getting started or looking to get to the next level.

5. What would the ideal service provider look like for us? Finally, take all of the answers you collected and create a profile of the best match amongst potential partners. Ask potential partners about their focus and vision for the future and see if your expectations and needs match up. Find out about their markets and product leadership. Learn about the persistence and passion they have for their companies, their products and their services, and how they cover the markets you serve. Determine the technical knowledge they have and how they will help your company to be successful. The closer you come to a perfect fit in these key areas, the better the relationship and likelihood of success.

With this assessment in place, you will have a much better understanding of what you would like versus what you really require from your partner. This is where the trade-offs come into play. While one partner may offer great compensation plans for flying solo, another may provide superior training and support with a lower commission. Partners may have strengths in certain size businesses, such as SMBs, while others are better with larger clients. You may feel most comfortable with a partner willing to make sales calls with you or your sales reps. Once you have chosen a vendor on which the success of your business is highly dependent, establish firm contractual arrangements and hold the vendor to its commitments.

Always proceed with caution. Be aware of any changes in your partners senior management, pricing, commissions and support. Changes in any of these areas may indicate trouble ahead. Be sure to have a contingency plan prepared and a second partnership agreement without monthly minimums or revenue commitments as a backup source for products and services. A good idea is to take a small portion of your business and give it to the partner that was second best, keeping them interested and providing a fall-back position if necessary.

While nothing guarantees the success of any partnership, following this process will help determine the partners that will give you the best chances for success.

Bill Taylor is president of Corporate Ladders, a management, sales and business development consulting and coaching firm specializing in technology, telecom, Internet, health care and financial services companies. He can be reached at +1 201 825 8296 or [email protected].