Making life easier for resellers
Tim Wilkinson, transactional business unit director for Lenovo UK and Ireland, highlights the challenges VARs face in operating in a continually evolving marketplace.
Despite an increasing number of businesses buying equipment from high street retailers, recent figures suggest that 56 per cent of businesses now purchase the majority of their goods online, an increase of 42 per cent in two years. For all PC vendors, an effective channel strategy which involves supporting resellers and providing them with tools is essential and enables them to compete in this dynamic marketplace.
Today’s channel is too heavily dependent on a small number of players, so resellers are on the look out for alternative, channel-focused vendors to retain a competitive edge. Every element of the vendor’s business and sales model should benefit the resellers’ business, enabling them to provide their customers with the best possible service. However, with an increasing number of high street retailers and internet-based retailers that have larger purchasing power and after services specifically for business, resellers and vendors need to work more closely to develop strategies to counteract this trend.
Attracting and retaining good resellers has to be the priority for all vendors; equipping them with tools to maximise their sales growth and profitability as well as providing them with best-engineered products, gives them a distinct competitive advantage. Any reseller programme should aim to furnish the reseller with a range of business skills to drive business growth, increase profit, improve margins, enhance demand generation and broaden product portfolios.
In addition, lack of goods, products comparable in price to those offered by competitors and consistent supply are problems regularly encountered by resellers and cause relationship problems with customers. Vendors need to develop a model to support the entire sales channel from transactions conducted online to those closed by the reseller. Offering the same products at differing prices throughout the marketplace only serves to place greater pressure on resellers who sell smaller quantities and so do not enjoy the best volume discounts available. It is essential to recognise the differing business needs of resellers and develop a partner programme to fit those needs; for example, a transactional business model to fulfill the infrequent buying patterns of the SME and small office home office market and a relationship business model typically for large enterprises.
A reseller programme based around a campaign model, which brings together the vendor’s supply and marketing functions is key. Such a programme can work to alleviate the problems that resellers face, ensuring a constant supply of all the campaigns’ key products during the entire three-month period.
Maintaining an open dialogue with resellers is essential to maintain a successful relationship. Resellers want greater comfort levels from their vendors, a more efficient supply system but overall want vendors to help them gain a competitive advantage and a campaign approach in the ever changing retail space.
As business buying patterns change, vendors need to develop a strategy to support every element of the resellers business. Ultimately, supporting resellers and providing them with the tools they need to do business benefits both sides and increases market share as well as profitability.