When vendors merge or are taken over, channel partners are often wary of what the future holds.
However, recent merger and acquisition (M&A) activity in the security
sector suggests they can work to the channel’s advantage, provided there is a
commitment to developing a successful channel strategy.
The merger between Marshal and 8e6 Technologies unites security solutions at a product level to create sales opportunities for the organisation and for existing and future channel partners.
Their combined company portfolio may add incremental revenue through cross-selling of products to customers as well as increasing the ability to compete with a stronger solution.
But the process of rationalisation that often follows an acquisition,
as well as the impact of new management, strategy and culture, can cause nervousness.
The delay between a takeover announcement and the final
agreement may be several months.
However, reselling the offerings of just one of the firms involved can negatively affect deals in the pipeline. Also channel partners may need extra training for staff.
To minimise the impact, companies should retain key sales and technical channel people. And key product development staff should ensure that research and development stays on track.
Competitors will be quick to exploit uncertainty to tempt customers, channel partners and employees off to pastures new.
Following deal completion, strategies must be consolidated and communicated quickly. Immediate, free, cross-product training can get partners up to speed.
Channel strategy is not always given enough consideration ahead of an acquisition. A mixed-mode direct and indirect channel strategy can only be a recipe for disaster.
Resellers may fear potential M&As, but such deals offer long-term benefits, and they are likely to continue to flourish in today’s economic climate.
The success of a vendor-vendor acquisition can be measured in the trust and business of key VARs.
The channel should assess how change might allow penetration of new markets and vendor support for the channel.
Alex Teh is commercial director of security distributor Vigil Software
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