Charting Channel Partners’ Paths to Profitability for 2014

Path to profits

1 - Profitability PrioritiesProfitability Priorities

As usual, almost a third of channel partners intend to hire more technical and sales people. But, surprisingly, 30% plan to invest in more marketing and offer higher-margin services.

2 - Keys to ProfitabilityKeys to Profitability

Quality products that don’t require a lot of support was rated No. 1 by 30%. Revenue and margin was a close second at 29%.

3 - Top Channel Partner Pain PointsTop Channel Partner Pain Points

More than half identify relationship issues such as channel conflict as a top pain point. Ease of doing business comes in second at 45%.

4 - Importance of Revenue and MarginImportance of Revenue and Margin

Well over half cite front-end margin as important while just under half cite overall revenue.

5 - Additional Revenue OpportunitiesAdditional Revenue Opportunities

Only 21% say vendors do a good job on back-end incentives, and 27% say they do well with special incentives.

6 - Services Pull-Through RateServices Pull-Through Rate

On average, the ratio of services to software revenue tends to be close to 3:1, while hardware services are about 2:1.

7 - Top Solution Provider RequirementsTop Solution Provider Requirements

43% cite pre-sales support from vendors, followed by incentives at 40%. Market development funds came in a distant fourth.

8 - Biggest Source of Partner RegretBiggest Source of Partner Regret

Conflict with vendors’ direct sales force leads, at 33%, followed by not enough margin, at 29%.

Michael Vizard
Michael Vizard
Michael Vizard is a seasoned IT journalist, with nearly 30 years of experience writing and editing about enterprise IT issues. He is a contributor to publications including Programmableweb, IT Business Edge, CIOinsight, Channel Insider and UBM Tech. He formerly was editorial director for Ziff-Davis Enterprise, where he launched the company’s custom content division, and has also served as editor in chief for CRN and InfoWorld. He also has held editorial positions at PC Week, Computerworld and Digital Review.


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