Suppliers spend a lot of time and resources on building channel programs and discount schedules to manage partner margins and pricing. A pain point for many, however, remains the high volume of partner sales opportunities requiring some level of price exception, terms or special bundling. So, what’s going on? Suppliers often assume that special bids are driven by partners that are taking the path of least resistance by leading with price and not selling value. Or, they perceive the channel as trying to gain additional margin for their own business at the expense of the supplier. The reality is that more complex issues are driving this behavior. Here are three key drivers that affect partner pricing efforts and what a supplier can do about them:
Channel special bids are a great way for suppliers to respond to the competition and changing market needs. If the pricing strategy, partners and target markets are aligned, the need for special bids should be minimized, but if they remain the norm, the supplier should investigate the price exception process itself. Are the thresholds for deals to be considered clearly defined? Is the partner required to demonstrate a real customer opportunity with a real pricing need that must be addressed? While this should not become a “sales prevention” exercise, building discipline into the process helps the supplier and the partner optimize their margins while growing the business together.
Eileen has a deep background in developing channel sales programs that drive revenue and helping channel leaders gain insights into growth strategies and industry best practices. She has delivered multiple partner programs, successful partner recruitment and development efforts, and impactful field and partner enablement. Eileen brings nearly 20 years of channel experience to SiriusDecisions, having worked previously for companies such as Avaya, VBrick Systems, NetApp and Symbol Technologies.