Going Global: The Channel’s Expanding Horizons
… 30 percent of the U.S. economy, but that business is being served by just 300,000 U.S. companies.
That sounds like a lot, but the International Trade Administration says firms that export goods and services represent just 1 percent of the United States’ 30 million companies — 98 percent of them comprising the small and midsize businesses served by the channel.
Forty-five percent of those respondents to our survey whose firms are not operating globally cited a lack of personnel resources to expand, with the problem especially acute among agents and VARs. Some 11 percent said they were not selling internationally because their business was already at “max capacity.” Perhaps they haven’t checked in with their master, distributor and supplier partners lately.
At the Ready?
“Provisioning was a nightmare, because the channel wasn’t developed,” said Vince Bradley, founder of WTG, looking back just a decade ago. Bradley says that a global footprint was always the vision for the connectivity services distributor and top master agent, which celebrated its 20th anniversary last year. “We literally had to create channels,” Bradley said, noting that the company, which picked Europe as its first non-U.S. market, entered Asia and Latin America in 2010.
Immature channels like Latin America still have issues with process, he said. This includes order flow, commission payments and what Bradley calls ROE, or rules of engagement.
“There’s an indirect correlation between the maturity of the channel and the ease of doing business with that channel,” he said. Echoing a key survey finding, Bradley said he runs into channels that have the right process and assets, but lack enough personnel. This is especially problematic for multilocation bids that require a quick turnaround on quotes.
Despite lingering problems, suppliers seem to be mostly on top of challenges. Seventy-three percent of respondents consider their strategic distributor partners equipped to support global sales, though only 22 percent said their distributors are “extremely ready” versus 51 percent qualifying that answer, saying they’re only somewhat ready.
Understandably, language is a top barrier for U.S. companies expanding into markets in which English is not dominant. Chris Joseph, vice president of marketing and product management for master cloud services provider NetEnrich, said entering non-English-speaking markets is complicated because the channel relationship doesn’t end with the sale. Already-charged day-to-day service and support issues can be exacerbated by misunderstandings both linguistic and cultural. In fact, several commenters cited the potential for confusion, not just with issues like …
