VARs need support in ERP market

Large vendors are not helping smaller partners sell ERP, says Paul Marry

While channel partners may naturally be attracted to the bigger brands, there is increasing distance between smaller resellers and the largest ERP software vendors.

One of the top-three enterprise software vendors has drawn a line under its gold partners: any partner above the line receives focus, and anyone below ceases to get account management, marketing, training, accreditation and leads.

Another large vendor has changed its tiering system, meaning that VARs are effectively downgraded.

This redrawing of boundaries and withdrawal of channel support may appear counterproductive for a vendor that seeks to grow its mid-market customer base, but large vendors have been known to sign up channel partners just to prevent them selling a competitor's ERP offering.

We have heard resellers complain that they have lost personal contact with their vendors; the largest become quite faceless organisations when it comes to their channel.

In 2010, Gartner reckoned that the shrinking ERP market was being sustained by maintenance and support fees from existing customers. In the mid-market, the quoted revenue shrinkage was less marked.

As more customers buy ERP as a service, there are plenty of opportunities for specialist resellers to tailor vendor portfolios to individual customer requirements.

The channel may understandably feel dazzled by the big brands and largest revenues, but smaller partners won't get a cut of that unless they have the right marketing support and product training from the vendor.

Companies such as Microsoft recognise that divisions and subsidiaries within large organisations require a blend of flexibility and power from ERP that corporate-wide systems cannot provide.

It's not just divisions of large enterprises that require this agility; smaller companies also require nimble business management systems to match new processes.

Dedicated ERP channel partners can deliver such bespoke systems.

Many ERP vendors have focused on improving their channel to meet a shortage of suitable ERP consultants. Channel companies are particularly valuable when it comes to deployments abroad.

Some ERP products are in demand, but do not have enough resellers.

If the largest vendors continue to treat VARs as a commodity, the resulting skills gap will continue to hold back the ERP market.

Paul Marry is chief executive officer of Intact Software