How to Maintain a Healthy Vendor-Reseller Relationship

The best partnerships are profitable for both the IT solution provider and the product vendor. How to get to that win-win solution takes planning and work. Here are some tips from Sanofsky, general manager-North America, at Paessler AG, that take your business from simply working with vendors to reaping the rewards of truly fruitful relationships. — Jennifer Bosavage, editor

Communication. As with all healthy relationships, amicable business dealings among vendors and resellers cannot exist without it. Unfortunately, in many cases the parties more resemble sparring partners than close friends striving to achieve a common goal.

Simply stated, the best vendor/reseller relationships require a mutual effort to learn as much as possible about each others’ operations including products, services and business models. Funny how pesky everyday business concerns have a way of preventing thiat from happening. Vendors and resellers must meet their primary responsibility of meeting customer needs all while making the extra effort to wear the other guy or gal’s shoes.

For resellers, that means demonstrating a sincere interest in a vendor’s products and its company at-large, regardless of the total number of competing vendors they work with. Along with sincerity, thoroughness is key. Making the time to learn as much as possible, even about the technical side of a vendor’s business, goes a long way toward building mutual trust and respect, two of the most basic tenets of successful relationships, professional or personal.

Both vendors and resellers should be as open and honest as possible, including sharing product ideas and plans—as early as feasible—with the judicious use of non-disclosure forms and non-compete clauses. Discussing proprietary information as early as possible, whether relating to a product rollout, strategic customer project or system implementation, forges bonds that promote cooperation and support ideally on an ongoing basis or, at the very least, for the length of a promotional campaign.

Potential partners both must understand the shared goals and objectives. That is crucial not only at the outset of a campaign or installation but also as key accomplishments and milestones are achieved. Well informed partners are more likely to provide mutual support, enthusiastically and not begrudgingly. Vendors and resellers are human, and humans like being appreciated and to know that mutual support is making a positive impact on each other’s bottom line.

In conjunction with open and frank dialogue among top executives and sales personnel in the trenches, the most successful vendor/reseller relationships also engage end users. That includes their best, longest standing customers to "sprouts" needing nurturing to grow. Without end users -- without growing demand for vendor product and reseller services -- neither channel partner can succeed. Just as vendors and resellers shouldn't independently set agendas without taking into account each others’ business models or concerns, separately engaging end users will lead nowhere and accomplish nothing.

Finally, developing and maintaining a healthy relationship requires vendors and resellers to continually ask questions of each other, and to reassess goals and objectives, policies and procedures for mutual benefit. Vendors must honestly ascertain the reason or reasons for their existing channel programs. For example, are they still valid, or have market conditions, reseller or end user requirements changed to the extent that the program itself must also change?

Vendors and resellers that work together to identify market conditions, form a united front. Together, they can create a new or modified strategy that builds strong relationships, and promotes the sharing of ideas as well as concerns. Remember, tunnel vision is one of the greatest enemies of healthy channel relationships.

Vendors depending solely on rebates, spiffs and special pricing to curry reseller favor are shortsighted, at best. The most progressive vendors recognize that steady sales leads are most valuable in forging resellers’ loyalty. Conversely, resellers, by their nature, sell products and services from a wide variety of suppliers. Those that take the time, and make the effort, to develop solid, long-lasting relationships with just a few vendors will more likely reap rewards. And that’s a true win-win.