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INTERNATIONAL TECHNOLOGY PARTNERS
Comprehensive Channel Development Roadmap
A step-by-step approach to building profitable channels
We Make Going Global Easier
Table of Contents
Table of Contents ················································································ iii Introduction ························································································· 1
SECTION I - INTERNAL PREPARATION ············································································ 3
This page left intentionally blank. ··························································· 4 Initial Target Markets············································································· 5 How Many Markets? ············································································ 14 Revenue Objectives ············································································ 16 Subsidiary – Build or Buy? ·································································· 18 Resellers/VARs/Distributors ································································· 23 Marketing Agents, Integrators and Consultants ······································ 24 OEM & Bundling ················································································· 26 Recommended Pricing Policies ···························································· 30 Forms of Payment ·············································································· 31 Sample Order Form ············································································ 34 Price Protection ················································································· 35 Discount Structure ············································································· 36 Maintenance Policies for License Sales ················································· 38 Credit Terms ······················································································ 41 Withholding Taxes ·············································································· 43 Recruit and Hire an International Manager ············································· 44 Company and Product Profile······························································· 45 Competitive Matrix ·············································································· 49 ROI Analysis ······················································································ 50 Documenting the Sales Process ··························································· 52 Pre-designed Web Pages ····································································· 54 Software Translation and Localization ··················································· 55 Integration Issues & Complementary Technologies ································· 60 Providing Technical Support to Channel Partners ··································· 61 IP Protection ······················································································ 64 Partner Application Form ····································································· 65 Non-Disclosure Agreement ·································································· 69 Letter of Intent: XYZ Company - ABC ···················································· 71 Formal Contract ················································································· 72 Sales Training ···················································································· 82 Technical Training ·············································································· 83
Define the Partner Profile ······················ 96 Define the Partner Profile····································································· 97 Develop a Database of Prospective Partners ········································· 102 Resources for Partner and ISV Searches ·············································· 104 Sample Outreach Letter 1 ··································································· 106 Sample Outreach Letter 2 ··································································· 107 Get a Contact Name ··········································································· 108 Using LinkedIn ·················································································· 109 Initial Prospect Contact and Qualification Script ···································· 110 Send Out One-Pager ·········································································· 112 Getting Past Voice Mail ······································································ 113 Follow-up ························································································· 115 Deadline for Response ······································································· 116 Check Vendor References ·································································· 117 Call Client References ········································································ 118 Financial and Credit Information ·························································· 119 Completion of the Product Evaluation. ················································· 120 Conference Call Agenda ····································································· 121 Reseller Meeting .Lead Registration ······························· 132 Lead Registration ·············································································· 133 Market Segmentation ········································································· 134 Compensation Neutrality ···································································· 136 Cross-Border Sales and Margin Splits ·················································· 137 PAGE iv .PARTNER MANAGEMENT ····································································· 131 This page left intentionally blank.Typical Agenda for 3-Day Partner Training ············································· 84 Partner Manual ··················································································· 86 Site Visits ·························································································· 88 Partner Conferences ··········································································· 89 Checklist – International Channel Program ············································ 92 SECTION II .PARTNER RECRUITMENT ········································································· 95 This page left intentionally blank.Who Should Attend? ················································ 125 Follow-up to reseller visits ·································································· 126 Mandatory Partner Training ································································ 127 Partner Recruitment Checklist ····························································· 128 SECTION III .When to Schedule ··················································· 122 Prospect Meeting Objectives ······························································· 123 Suggested Agenda for Meetings ·························································· 124 Reseller Meeting .
Market Development Funds (MDF) ······················································· 139 Sales Contests ·················································································· 140 Quota Clubs······················································································ 141 Spiffs ······························································································· 142 Initial Marketing Reports····································································· 143 Pipeline Report ················································································· 144 Sample Pipeline Report ······································································ 145 Partner Portal – Main Elements···························································· 146 Regular Newsletters ··········································································· 148 Annual Partner Review ······································································· 149 Terminating Partners ········································································· 157 Importance of Notices ········································································ 159 Master Checklist – 12 Month Activity Plan ············································· 160 12 Month Activity Plan Worksheet ························································ 162 PAGE v .
All rights reserved.Copyright 1997-2008 The York Group International. Inc. PAGE vi .
3. and by following the steps described in it you will be better prepared to enter new markets. Your channel partners will need constant care and feeding to make sure that you remain an important part of their business.Introduction Welcome to The York Group‟s Channel Development Workbook. Please check in on Microsoft‟s partner portal from time-totime to make sure you have the latest version. The recruitment process. building or expanding their channels to drive accelerated revenue growth since 1993. providing the support they will need to represent you properly. Our channel workbook is continually being improved and expanded as we learn from our client engagements. 2. This section describes how you build the right partner profile. We are pleased to make our methodology available to Microsoft Certified and Gold Certified ISV partners. how to identify them. The processes. The workbook is organized into three sections: 1. templates and recommendations are the result of having worked with hundreds of software companies from all over the world. Prospective channel partners are much more likely to invest their time. money and resources to make your product a success if they are confident that you are going to be a good partner for them. Managing the channel once it is in place. The internal processes a company needs to put in place in order to build and support a channel. and/or generate more sales from your existing partners. and then explains in detail the steps you should take to qualify prospects in a way that will produce motivated partners able and willing to actively sell your products on an on-going basis. Page 1 .
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INTERNAL PREPARATION Page 3 .SECTION I .
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908. Bangladesh 8.000 143. Russia 9.000 127. Pakistan 7. and depending on the technology.Initial Target Markets This is the first critical decision for a company.Can the product be sold and used in English.000 128.000 Page 5 .114.000 217. including: Language requirements .851.082.297.000 179. or does it require translation and localization? Markets where many products can be sold in English: U.136. Japan 1. Indonesia 5. Canada UK Australia and New Zealand India Singapore and Malaysia Hong Kong South Africa Israel Middle East Netherlands Nordic Region Brazil (for many business applications) Size of the population – Does the product sell to a broad range of individual users? Is the total population a good indication of the market potential? The 10 most populous countries: 1. China 2. and for many it is also the first critical mistake they make. especially for small and emerging companies. India 3. Nigeria 10.000 300.S. there are many factors that can be evaluated in order to determine the best initial target market(s). USA 4.000 147. This is rarely the case.771.607.003. Companies have a tendency to want to go after the largest markets first.677.000 1. Brazil 6.000.171. the potential pay-off is going to be bigger in a larger market. on the theory that if they are going to spend a certain amount of money to enter a market.000 151.
587 3. then what is your revenue potential if 90% of software is pirated? The software piracy rates in some high profile markets are: o o o o o United States UK Japan Germany Australia 22% 29% 29% 30% 31% Page 6 .S. while the retail market is expanding rapidly.441 38.471 2. If China is a relatively small market to begin with.183 Per Capita 1. in absolute and per capita terms: Absolute 1. Presence of competitors – Who are your major competitors. GDP and ICT spending per capita – Is the relative wealth of a country and the amount it spends on ICT a good indicator? The ten largest ICT markets.000 largest companies in Europe” for European data. This is also true in China.661 349. the number of significant players is still relatively small.325 Spending in major vertical segments – Is your product designed for specific segments. where the industry gorillas have not yet emerged in all sectors. Sweden 6.689 114.480 2. government. UK 5. 2. 2. U. and how firmly entrenched are they in your target markets? Are they selling direct or are they using a channel? Have they localized their products? Piracy rates – If your product does not have a security mechanism built into it.517 2.453 2. Denmark 7. China 7. Norway 4. Japan 3.729 2.627 2. or if it can be easily replicated.S. and many emerging chains are purchasing foreign systems.600 67. etc? Spending can vary from country-to-country. Japan 5. the retail sector in India is growing very quickly as the concepts of franchising and multi-outlet chains take hold. France 6. UK 9. Finland 10. Italy 8. such as retail. Germany 4. or are they growing rapidly? For example. manufacturing. U. See “15. Singapore 8. Canada 9.406 52.055. where are they from.099 150. New Zealand US$ 3.460 44. Switzerland 3.384 146. then the piracy rates will have a direct impact on your potential revenues.739 2. Brazil ($000s) 1.669 85.352 2. Are those segments fully developed. Korea 10. Number of potential clients in key verticals – Continuing the example of India.
but it is also home to many technology companies specializing in wireless applications. Technology adoption – Is the market an early adopter. and how many partners or markets you can support. and is this important for your product? If you are a wireless application.o o o o o o South Africa France Italy India Russia China 35% 45% 49% 73% 87% 92% Time zones and support requirements – If your product is complex and will require your involvement in the first few installations. Are you better off being an early entrant in a slower adopting market? Transferable references – Have you sold to the local office of a multinational? Is it possible to “upstream” the relationship and get a foothold in the market where the parent company is based? Exit strategy . it may influence where you start. the Nordic region is an early adopter. because it will impact the market selection. Is an IPO likely? Are you positioning yourself for a trade sale? Is the company being operated for cash flow? Page 7 .You need to have a clear understanding of what your exit strategy is.
The map and chart below are meant as examples: Page 8 . marketing.Overview of the largest markets If we look at the largest IT markets. national market. A general principle is to try and make them roughly the same size in terms of economic activity and/or the presence of prospects. with under $50M in revenues spend an average of 89% of their revenues on sales. general and administrative expenses Potential channel partners are inundated with opportunities Regionalizing the United States There are many different ways to geographically segment the U. but the most competitive market in the world For most products it is not a single. they all represent significant challenges: The United States The largest. Listed software companies in the U.S. but a collection of regional markets that have to be approached individually Cost of client acquisition can be prohibitive because of high marketing costs required to establish brand awareness.S.
Rhode Island. South and North Carolina Illinois. Vermont. Kentucky. New Hampshire. Delaware Georgia. Mississippi and Louisiana Arizona. Michigan Texas. Iowa. Northeast Greater NY Mid-Atlantic Southeast Upper Midwest Midwest Southwest Mountain States California Pacific Northwest Geographic coverage Massachusetts. W. Kansas. Minnesota. Pennsylvania. Nevada. E. Utah. Colorado. Missouri. Connecticut DC.S. Alabama. and N. W. Arkansas. Indiana. Virginia. Pennsylvania. Montana Setting Priorities After defining the geographic regions and the key factors. New Mexico. Florida. This will result in an objective assessment of the regions that make most sense. Maryland. Nebraska. Number of Prospects Competition Proximity Channel Partners References Total Page 9 Pacific Northwest Mountain States Upper Midwest Mid-Atlantic Greater NY Southwest Southeast Northeast California Midwest . Oklahoma. New Jersey. Oregon.A. and in which order. Dakota. Tennessee. Wyoming California Washington. Each of the regions and key factors should be ranked on a scale of 1 to 5. Idaho.Region U. Wisconsin Ohio. S. the final step is to put together a scorecard to help determine the best markets to go after. Maine New York. Virginia.
S. there is only so much one person can sell and it can be easier to achieve this potential in a smaller market that is less competitive. Will likely be a frustrating market in which to find good partners. rapid changes in the market (which increases their risk). so a company is likely to find the same competitors in the UK as at home (especially true for U. but an important market to have a presence in. with a business concentration in and around Toronto UK – very competitive. English OK for many IT products. For lower cost products it is unlikely that they will become a strategic product for a partner due to the level of competition. and are often tied to the corporate structure in Japan (Keiretsus) United Kingdom The first port of call for most companies wanting to enter Europe. best case. a software ISV will get.Japan Localization of software products often a requirement Cultural differences and language can be a big hurdle to market entry Distribution channels are much different from the U. Additionally. Sweden. so it is not always a logical entry point for the rest of the continent One salesperson rule of thumb When establishing an agreement with a new distributor. so the competition for good partners is fierce The UK is not considered part of Europe. But regardless of how large a market is. channel partners in second and third tier markets tend to be more flexible and understanding in their dealings with less experienced software ISVs. and Europe. This means that there may not even be one dedicated full-time equivalent driving the sales.S. Denmark and Finland) – very high Internet adoption. companies) There are more good products looking for a channel than there are channel partners willing to invest in representing new products. relatively quick decisionmaking Page 10 . and the fact that the ISV will want multiple partners in all of the larger markets. General Recommendations Phase 1 markets Canada – a good expansion point for North America. Netherlands and the Nordic markets (Norway. one full-time equivalent salesperson.
good partner infrastructure India – a rapidly growing market with more potential for many companies than China. good way to expand footprint in Asia Hong Kong – similar to Singapore.South Africa – English-speaking. many products can be sold to corporate market in English. and could be a gateway to China with sales to multi-nationals before localization Australia and New Zealand Brazil – largest market in Latin America (55% of total). English-speaking. relatively low piracy rates High Internet penetration rates Significant international trade/communications Note: If an ISV only does these countries it would have a channel in 15 markets and a presence on every continent Phase 2 Markets France Germany Italy Spain Portugal Argentina Mexico Characteristics: Initial sales possible in English Translation required to maximize sales Good to excellent channel structure used to dealing with international suppliers Lower Internet penetration Page 11 . recognizable legal system. relatively sophisticated business market Characteristics of Tier 1 markets: Products can be sold in English Well-developed channels With the exception of India and Malaysia. both countries are English-speaking. less competition Singapore/Malaysia – Singapore a major communications hub. high Internet penetration.
. in part. to piracy Could be done on an ad hoc basis. but may not be worth a focused effort. ISVs China Small domestic market due.e.S.Special case: Eastern Europe more strategic than revenue-generating a market poorly served by American firms relatively few good channel partners. but they exist higher piracy rates translation less of an issue – no one else does it Phase 3 Markets Japan Complicated market structure Product will need to be localized Best to find a strategic partner who assumes responsibility for everything Rest of Latin America Highly fragmented market. i. and often need a personal introduction Poorly served by U. at least not in the early stages of international growth Initial market probably limited to multinationals operating in China Beijing a more significant market than Shanghai Page 12 . lots of small markets Low Internet penetration Good partners hard to find.
Microsoft Resources The International ISV portal provides a number of resources, including expert articles, checklists, market assessment and planning tools as well as market research from IDC and DataMonitor. The portal can be accessed through the following link: https://partner.microsoft.com/US/program/competencies/isvsolutions/4002909 3 Once on the portal, click on “Select the right markets”, which will bring up a list of major IT markets, and within each market there are sub-sections with market research.
How Many Markets?
It can be tempting to go after every international market simultaneously. However, this can lead to problems that can have a negative impact on the company. The number of markets to go after initially will depend on a number of factors: Does the company have enough people resources to provide marketing and technical support to multiple partners? Does the company plan to hire a full-time international manager, or will an existing employee be given international? If so, will they be full-time, or is international just one more thing they need to do? Does anyone in the company have experience with channel development? If so, will this person be assigned the responsibility for international? Again, will it be full-time or part-time? Is the product sold through an indirect channel in the domestic market? If the company does only direct selling in its domestic market, they will have to become familiar with channel management in general, as well as doing it internationally, so they might want to ease into the process. If the company has a successful domestic channel, they already have the mindset on how to deal with partners, and may only have to modify their approach for the international markets Does the product have to be translated and localized? This can be an expensive and time-consuming process, and it may limit the progress to one market at a time. How competitive is the market? In other words, is the technology something that has to be established quickly, in order to get to the market ahead of the competition? Or is it a niche product with little competition? How complex is the product? Will the ISV have to be involved with initial sales and installations, or is it an out-of-the-box solution that a partner can handle with a minimum of training and involvement from the ISV?
In many cases, especially for smaller companies with little or no channel experience, it makes sense to start with two or three English-speaking markets as a way of testing the international arena. This will give them a chance to: fine-tune their recruitment program. For most companies this will be a new process, and they will have to get used to dealing with partners in different countries. And not everything they implement will work right away. Perhaps the marketing materials have to be revised. Will the pricing make sense in other markets?
build up the necessary support infrastructure. The company will have to sell its employees on the importance of being responsive to international partners. For most employees this will be an additional burden, and it will be important to have the right procedures in place before an aggressive roll-out. develop international reference accounts that can be used when opening new markets. Nothing succeeds like success, and it makes a big impact on the market (both for prospective partners and end users) when a product is a proven success outside its own market. This is particularly true for products from non-English speaking markets. For instance there is often a perception that a French product did well in France simply because it is French. But once the English language version has been successfully sold and installed outside France, the perception changes dramatically. To a certain extent, the same is true for American products, but for cultural reasons, rather than language. People tend to think that their own market is different, so just because it works in the U.S. doesn‟t mean it is going to work in Europe. generate revenues that can be re-invested to accelerate the international channel development program. Building international channels is going to take time. Partners have to be found and recruited, then they have to be trained, and only then do they start marketing the product. If they then have a 3-6 month sales cycle, and a 30-90 day collection cycle, it will usually be 6-12 months before a company starts to see any meaningful revenues. In the meantime it costs time and money to support the partners. If a company focuses on two or three markets first, they can start to generate revenues that can be used to provide additional support to existing, successful partners, as well as go into new markets.
For each market.60 = $900. the greater the likelihood of success in new regions) Basic Formula: 1.000 x . Each partner is expected to sell 10 licenses. determine the number of channel partners required. The reseller discount is 40%. Establish minimum license sales in order to retain partner status 3. If revenue objectives are not established it becomes difficult to select the right markets to go after.000. Multiply the number of partners by the number of licenses and the expected price. one in the south. health care. scaling the business without having to hire a lot of direct salespeople. determine the optimal number of partners based on vertical segments and the number of prospects in each vertical 2. and one in the east. For example. as long as each sub-segment is large enough to support at least one partner Competition Product maturity Sales cycles Marketing support budget (revenues don‟t happen by themselves) Existing client and revenue base (the more successful a company is already. education. Define the size of the most likely buyers (100 users? 5000 users?) 4.). there might be one partner in the north. Some of the factors that should be included are: Exit strategy (is the company being positioned for an IPO or a trade sale?) Size of the target market – revenue objectives should be established for each individual market. with an average account having 500 users and a transaction value of $50. and within each market geographic and vertical markets should be segmented. etc. for some products the Northeast can be segmented into multiple verticals (financial institutions. or to negotiate meaningful targets.Revenue Objectives Companies develop a channel in order to increase their revenues. adjusted for the reseller discount.000 Page 16 . The revenue objective for Germany would be: 3 x 10 x $50. Example: In Germany. set up a budget. but they often do it without having any idea of what their expectations are.
and within each market there are sub-sections with market research. which will bring up a list of major IT markets.microsoft.com/US/program/competencies/isvsolutions/40029093 Once on the portal. Page 17 . it can provide an indication of the availability of reseller partners in various markets. click on “Select the right markets”. While not a comprehensive study.Microsoft Resources The market research available on the International ISV Portal includes a DataMonitor report on the number of Microsoft Certified Partners broken down by revenues and vertical market coverage. The portal can be accessed through the following link: https://partner.
There are many advantages to having your “own people” in markets outside the domestic base. It all comes back again to control – if you own the resources. marketing strategy. bringing your customers consistent service and support. Control – This is the key to the remaining arguments. Resources can be marshaled to whatever event or activity is important to your business at that moment (within reason). you have the freedom to assemble a team that works best within your corporate culture. The ability to set end user and transfer pricing allows for greater control over profitability and repatriation of those profits. This is by no means an exhaustive list. corporate structure. support. a certain consistency in approach and execution can be achieved. particularly for localized products. is to do it yourself. Flexibility – Having your own employees provides a measure of control over the use of time and resources. support. Profit – Prices internationally are often higher than in the domestic (USA) market. and of course.Subsidiary – Build or Buy? The Pros of Building Why do companies build rather than buy. as well as sales model. A well assembled team will be an extension of your company in a distant market. People – By recruiting the people in your organization. but covers some of the answers found repeatedly in client meetings.Indirect channels are often more concerned about building their own brand and profile in their local market. By controlling your process from end to end. Quality – This comes back to control … the way to make certain quality remains consistent. Page 18 . personnel. Consistency of the company profile and marketing message . and market your products. sales channel. By choosing the people who sell. and do not always follow an ISV's marketing strategy. pricing. you can ensure that it is carried out in the way you want – whether that process be sales. marketing or any other part of your overall business. Building an operation means you have the right to choose location. you can control what they do and when. particularly as a first step? The reasons are as varied as the companies.
revenues ramp faster if they are not shared with a channel. To illustrate a point. the location chosen initially for the convenience of visiting home office executives. and often fleeting. Channel recruitment challenges.When going through a channel. we believe control is perceived. or tax holidays. laws and attitudes of the local market. control changes in character. Acquisition of a previously independent partner to eliminate these risks and secure control is not uncommon. Over time. maintenance collection and upgrade sales can get very messy.Channel partners are at risk of being acquired. developing a channel is difficult. In the U. but influenced strongly by the culture.. and time-consuming management challenges in managing a successful international operation.Control of the customer base . In some markets. but a very different one to those working in the home office . there is still a "bricks and mortar" mentality among many investors. may be or become financially unstable (through loss of a major product line) or may be mismanaged. control over a subsidiary is usually a matter of degree and compromise. similar to the head office. goods import and shipment.S. cultural differences account for some of the most difficult. For example. The Cons of Building Now a look at the cons to building a subsidiary.S. Control – Short of going to manage the business yourself. the ISV will not always know who the end users are. Subsidiaries take on a personality of their own. indirect channels are inundated with product opportunities from the U. and they are resistant to taking on products from overseas. who like the feeling of company-owned assets on the balance sheet. particularly with the second generation of employees people who also have history with the company. Notwithstanding the often misguided belief that “they all speak English”.regardless of frequent head office visits. let‟s discuss the same topics above. for instance. Eliminating risk . so the potential value of the company as a function of a revenue multiple increases faster. Investors prefer them .First. but from the other side. frustrating. Second. may have to be abandoned if potential employees do Page 19 . Thus. and issues such as customer support..
American companies accustomed to the labor flexibility of their home market are often shocked by contract based employment laws. housing. financing.g. These reduce labor flexibility. Every such change relinquishes another element of control to some extent. Consider that while price for your product is often higher in international markets. for example). pushing salary demands higher. Profits – Let‟s examine the opposite side of profit – cost. insurance. In Europe. utilities. Employment costs are another significant area often overlooked. Some products enjoy a very positive reputation in some markets based their country of origin (German cars. and social influences completely unrelated to the products themselves. American software.prices are higher for a reason. Marketing campaigns may cause strongly negative reactions in foreign markets (e. inanimate. quality is not innate. often based on cultural. communications. while potential customers in Germany or Switzerland may view the company as unstable – in an environment where evaluation cycles are often longer than release cycles! Thus. Belgian chocolate. Quality – Perceptions of quality are culturally biased. and require the adaptation of methods more suitable for the markets in which your subsidiaries operate. A product or service that is perceived as positive at home may have quite the opposite characteristic and/or connotation in other markets. Page 20 . economic. Get the picture . etc. Swiss watches. or innovative in the USA. and complicate hiring practices – or cost a lot of money to fix if you get them wrong. transportation. it is by no means unique . Chevrolet‟s “Nova” model which failed in Spanish speaking markets where its name translated to “no-go”). computers. An American software company that releases three new versions per year may be viewed as leading edge.) while others carry strongly negative connotations in others. The domino effect drives overall business costs higher. since higher costs directly impact profits. etc. for example. or obvious – a product perceived as high quality in one market does not guarantee it will enjoy the same perception in others. food. and the cost of doing business significantly higher.not want to travel there to work.every other item and business service in these markets is also more expensive – taxes. office space. Sales strategies that work successfully in the home market may not work at all in other places (telemarketing or direct mail.
or to pay out the often-generous severance allowances for employees who do not want to move. Perceptions of work ethic. Just because people look alike. and much more that is unusual in the USA. management. Flexibility – Employment contracts.Social insurance costs paid by the employer over and above gross salary in most European countries are 100%-300% higher than in the USA. What changed? Why? Welcome to one of the greatest management challenges in running international operations – cultural conflicts. mobility. At least in Europe. After investing considerable time. People who seemed to wave the company flag during interviews now challenge headquarters on seemingly basic issues. speak the same language does not. Seemingly innocent corporate policies meet with vehement disapproval or worse. The presence of unions is another factor reducing labor flexibility – they are much more widespread in the white collar work force than in the USA. and sometimes 14th month‟s salary. Benefits packages. particularly in European countries. but routinely go to 6+ weeks. and take an active part in worker welfare as well as industrial actions. People – the very base of your business. because they may be with you forever. the caution for hiring managers is to review employees carefully. reduce flexibility in many important ways. phone lines at home complete with fax machines. and every other aspect of life will surprise and amaze. buying cellular phones. a 13th. Contract based employment means that any significant policy change affecting labor may require government approval (and they can just say no). and money recruiting. Managers in many European companies cannot conceive of the idea of making sales calls – “our job is to manage”. but normal in Europe. meaning that every 8 th employee just covers vacation time for the first 7. and challenged at every turn. and then cost thousands to implement in the approved fashion. repeat not. creating equitable labor contracts. effort. leasing company cars. change positions or possess skills the government believes to be in surplus (for whom you may be responsible for re-training). legal challenge. and all the rest… why is it not working? Management directives are met with “why” instead of “when”. Page 21 . Hiring employees does not guarantee a smooth implementation of company policy or culture – usually because there is more than one culture to be considered. routinely include company cars or commuting costs. particularly in Europe. responsibility. Vacation allowances hover around 4 weeks. club memberships. mean they are the same.
depending on the tack taken on viewing each one as we have shown above. pick the market you are interested in.microsoft. link to “Establishing a Business” which contains a spreadsheet with the indicative costs.Summary – Building Arguments on building can either support or oppose the strategy very easily. Log on to https://partner. One piece of advice based on the author‟s experience in setting up many subsidiaries: Add 25% to implementation plan time frame.com/US/program/competencies/isvsolutions/40029093 . just the fortitude to take on the challenges involved in setting up the first (and every) subsidiary. market forces. and 50% to expense estimates in order to have a greater chance of being correct. It is a complex combination of internal needs. and in the third column over. and move ahead. and sometimes. There is no clear method by which a company can determine empirically whether to build their own operation or not. then click on “Select the right markets”. Page 22 . Microsoft Resources The International ISV portal contains information on what it costs to set up a threeperson office in various markets.
This becomes common when a developer has so many resellers that it becomes too costly to deal with them directly. be they hardware or software. Page 23 . Generally. There is an effective marketing program in place The developer is able to provide technical support. VARs will rarely advertise or market specific brands. Distributors will usually not take on a product unless: There is a significant existing or potential market Resellers are already aware of the technology and have a desire to buy The product offers features that substantially differentiate it from the competition. Resellers are expected to market specific products. the reseller has their relationship and buys their product from a distributor. Resellers tend to be product-oriented. while VARs will include those products in an overall solution that they are selling to their clients. but rather than having a direct relationship with the developer.Resellers/VARs/Distributors Resellers can also be a part of Channel Management. and VARs tend to be solutions-oriented. distributors will look to a developer for at least 50% margin plus additional funds to help in the marketing and promotion of a product. so they do not represent a direct conflict with traditional resellers. training and merchandising tools The difference between resellers and VARs is based primarily on the level of services provided with a sale.
but does not control the sales process. From the time an agreement is signed the ISV would be responsible for delivering and supporting all company-related products and services to the prospect. The ISV will also invoice the end-user directly.Marketing Agents. Some of that commitment may come in the form of: Completing an application form Some type of certification testing (which has to be matched with the developer‟s ability to provide some type of training – even if it is nothing more than stepping through slides on the company‟s web site). a marketing partner would meet. The ISV would invoice the prospect directly. educate and bring to the developer a customer who is prepared to sign a contract. which can result in higher-thanexpected costs. and receive payment directly from the prospect. For this extra level of commitment a marketing partner would expect to receive 30 to 35% commission on all products and services sold by the ISV to the prospect for a specified period of time. educate and bring a “ready-tosign” prospect to the ISV. Integrators and Consultants This category of channel partners influences the purchase decision. They can open the door to sales opportunities. Sales Consultants Sales consultants are a step up from referral agents in that they actually meet with. Marketing Partners Some companies may want individuals or companies representing their products to have a higher level of commitment than a consultant normally provides. the ISV owns the relationship as it relates to installing and supporting the solution. Once the contract is signed. but the ISV is usually involved in closing and supporting the sale. Generally in this type of relationship a consultant will be paid a 20%-25% commission on all revenues generated through the end-user for specified period time (usually a year). Development of a marketing/business plan Minimum investment annually in proactive marketing efforts As with a consultant. Page 24 .
Project management. Getting selected by an FM firm is difficult. 3. and then present product options to their clients. with clients around the world. In either case. but can be very profitable. their technical specifications and pricing. if a product becomes adopted as a standard. integrators can approach the projects in a couple of different ways: 1. find a solution. Integrators are very similar to VARs. Since FM firms tend to be very large. Facilities management/Outsourcing. Page 25 . Companies such as EDS. A strong relationship with system integrators can be hard to achieve because they get called on by many software ISVs. that take over the entire information systems management for their clients. with both existing and new clients.Integrators & Technology Consultants Like VARs. and do not focus on selling specific products or brands. and cost plus for enhancements. However. Cap Gemini Ernst & Young and Accenture take on large projects for their clients. In most cases they will design the solution. the consulting firm might present three possible products. if the project requires file transfer. in that they integrate software and (often) hardware into a custom solution for their clients. who are ultimately responsible for making the decision. it is often installed at many other sites around the world. For instance. where their responsibility is to evaluate a problem. Systems integration. integrators and technology consultants work with their clients to provide a total solution. 2. This is often done on a fixed price basis for managing the current infrastructure. There are some large IT companies. such as EDS and IBM Global Services. and the client makes the choice. the facilities management firm has a strong incentive to purchase products that reduce the operating costs or that make the environment they are managing more efficient. and then implement it. The challenge for a developer is to get visibility with consulting firms so that they are in a position to evaluate and possibly recommend their products. but once it is in place can lead to repeat business with a low cost of sales.
it has a negative impact on the value of the company. In part this can be due to the “Not Invented Here” syndrome. 3. Certain technologies do not lend themselves to being integrated with any other software solution. and either sold as part of a new release. It can be difficult to find software companies willing to integrate another company‟s technology. or should have. Technical support requirements are minimal – the ISVs product or module becomes part of another solution that is supported by the OEM partner. 5. Page 26 . or becoming dependent on a third party for part of the company‟s solution. Although resellers are sometimes concerned with having the same product sold through other channels in their market. the business arrangement can generate a significant. revenue stream. Potential Challenges 1. branded ISVs.OEM & Bundling Entering into an agreement to license or bundle one‟s technology with a vendor that has an established market position can be an excellent. Quicker time-to-market. There is a loss of identity. The OEM partner should have a large client base that the product is sold to. This is commonly referred to as “OEM agreements” (Original Equipment Manufacturer – a term that originated in the automotive industry but is now applied to software products as well as hardware products) or “private label agreements”. an installed based that they sell the product to. 4. and if an ISV is essentially an anonymous supplier of technology to other. Having one‟s own brand is often important in the valuation of a software company. the easier it is for an OEM to sell and distribute the product. so building a brand becomes more difficult. or as an add-on module under the name and label of the OEM partner. 2. In larger markets an OEM model can co-exist with a reseller channel. The sales and pricing strategies used by the OEM should have little impact on direct sales efforts or other indirect sales alternatives – thereby keeping all options open. It does not consume any internal advertising/marketing efforts – this is the responsibility of the OEM partner. An ISV‟s software is typically integrated with an existing solution. the fact that it is sold under another name to a defined client base helps limit channel conflict. especially those that require a fair amount of customization with each installation. and immediate. 2. low-cost approach to getting started in a new market. Advantages 1. but it can also be due to technical issues involved in integrating the solutions. The more “packaged” the solution is. The cost of sales through this partner is virtually zero since they have. 3. and depending on the pricing structure.
but there are some risks with this pricing model that need to be addressed in a contract: The bundled module becomes a loss leader for other products the OEM is selling. if the initial value of the ISV‟s contribution was set at 30%. Rather than simply reducing the price over time as an OEM partner reaches defined purchase levels. For example.they are usually negotiated on a case-by-case basis. and the OEM partner becomes a large part of an ISV's business. the OEM might get a price of $500 or $600 if they do not commit to specific volumes. with volume discounts for larger purchases. If the pricing is so low that the OEM partner becomes a low-cost competitor. the OEM partner could be in a position to exert a lot of pressure on the ISV when it comes time to renew the contract. if the OEM partner adds substantially more code to its own part of the solution they could potentially drive down the relative value of the ISV and reduce the license payments to 10 or 15% of each transaction. an ISV should encourage an OEM to “buy down” the price Page 27 . there is a risk that the OEM partner greatly reduces the price in order to sell other parts of their product line. Discount from the list price. Contract negotiations have to be handled carefully.000 units. Under this pricing model an ISV is paid for the value of their code relative to the overall solution. to prevent the ISV‟s product being included as a low-cost add-on that could possibly undermine the ability to sell the product separately. it will have an impact on the ability to establish a viable channel for the ISVs own solution. Under this pricing model the OEM partner would pay a per unit price. However. Pricing Considerations There are no established pricing policies for this type of relationship .4. if the list price is $1000. In theory the OEM partner will always be motivated to maximize their own revenues. 5. For example. They would get volume price breaks as they purchase 100 or 1. if the module in question represents 30% of the total solution. or to maintain a higher price on other products at the expense of the ISV. only purchasing the product on an as-needed basis. the ISV would get 30% of the revenues from the sale of the combined product. There are two distinct advantages to this pricing structure: If structured properly. If the contract does not establish a minimum price for the ISV‟s module. If an OEM agreement is very successful. By way of example. there are two basic pricing models that are used: Percentage of the overall solution. The OEM partner increases the size of their own modules to reduce the relative value of the ISVs product. it can generate significant up-front cash.
The advantages include: 1. If an OEM agreement is just one part of multi-pronged distribution strategy that might include direct sales and/or reseller channels in certain markets. If the baseline discount is 50% for ad hoc purchases the OEM can establish a lower price for the full year of a contract by making an up-front purchase. preferring to order products on an “asneeded” basis. doubles processing speed).000 units and $250 if they pay for $2. The cost of sales are virtually zero. If the OEM partner makes significant modifications or improvements to the ISVs underlying technology. For example. If they really expect to sell a lot of the product they will want to establish a unit price that is as low as possible. If the OEM declines to purchase products up-front. this could be by geography. Legal Considerations The cost of technical integration. 100 units up-front. and they should be careful about investing too much time and resources. For example. it would be rare that a new technology could utilize this option. Some products require significant modifications in order to integrate properly with another solution – who pays for what should be clearly spelled out in the agreement.. based on an initial purchase. in some cases they can end up with ownership of the new and improved product and no longer have to pay royalties to the ISV. An implied (if not actual) endorsement from the hardware manufacturer. thereby making it more attractive for them to make a more substantial up-front purchase. and pay for. Page 28 . guaranteeing the OEM partner a low per-unit price for every additional purchase. The only reason a hardware ISV would include software is if it helped to push the hardware. the price might be $400 per unit if they buy. Defining the markets. Hardware Bundling Some software solutions may lend themselves to being bundled as part of hardware sales. And in order to have that spin.500 units. It is a good indication of how serious the OEM partner is about selling the product. However. or specific client groups. 2. The unit price would then remain at $250 for the remainder of the contract year.g. either the market needs to already know the benefit of the software or the benefit of the software must be very obvious and compelling (e. Derivative technology. the target market that the bundled solution can be sold to should be clearly defined. it is a good indication to the ISV that the relationship is unlikely to produce a lot of revenues. and $300 if they pay for 1.
and manufacturers are not willing to pay much for OEM software. Low per unit pricing. Hardware margins tend to be low. There may be very little contact with the end-user and therefore diminished opportunity for add-on sales. 4. The opportunity for upselling to users that get an entry-level version of the product (“Lite” vs. Will rarely have any impact on the company‟s pricing model through any other sales alternatives. 2.3. Page 29 . “Pro”) 4. May require supporting an uneducated buyer (potential high support costs). May diminish the market‟s perceived value for the product. 3. The disadvantages include: 1.
the list price will have to be modified as exchange rates change. who might feel that the partner is trying to rip him off Might want to consider two-tiered pricing. the ISV will be asked to participate in special discounts required to close the sale Don‟t publish pricing on the Web the Web makes pricing transparent to the end user. or if a region is going through a financial crisis. often expensive market cost of translation/localization additional discounts that are often required in the local market. end users will often call and try and order direct if pricing is lower lower pricing on the Web makes the partner look bad vis-à-vis his client..e. i.Recommended Pricing Policies Establish an international price in a single currency. and this creates a real conflict with and for partners. so if the partner is on a fixed discount from the list price. such as Southeast Asia in 1998. e. preferably $US and Euros (same value in each currency. Establishing and trying to control local currency prices creates a lot of potential problems: exchange rates are constantly moving. India. because "normal" pricing might be prohibitive in many developing markets Allow partners to establish local currency pricing to cover: exchange rate fluctuations cost of doing business in a small. Italy withholding taxes. customs and duties that make the product more expensive Page 30 . 100). with lower pricing in low-cost countries such as China.g. if pricing is available.. this is an administrative headache if the discount is based on the local price. Turkey. this is common with most large ISVs.
so an order isn't necessarily final just because the credit card authorization has been issued Page 31 . Transfers can normally be completed in two or three days but they can take up to ten days depending on the country of origin. but there has been a marked increase in the use of credit cards since American Express started to award mileage points for business purchases. The receiving bank might also charge a fee. It can save time and money. They are reliable. Credit cards have the advantage of being processed immediately. IBAN (International Bank Account Number). well in advance. who make payments to you from other countries. they can be traced. Credit cards Credit cards are often used for lower priced. If there is a delay. and they can't be reversed once the payment has been completed.Forms of Payment Wire transfers Wire transfers are the industry standard. The international standardized format for account numbers. This will confirm that the wire has been processed. The IBAN always starts with a two-digit country code which is followed by a two-digit control part. ask them to fax a copy of the wiring confirmation from their bank. We recommend that you send your IBAN and the bank's SWIFT/BIC to your foreign partners. as well as any fees charged by correspondent banks. and the partner is pushing for product delivery or a permanent code. and this fee. and can therefore expedite the ordering and shipping process. and it allows a wire to be sent directly from bank to bank without going through a correspondent. Things to consider: Wire transfer fees. Things to consider: Credit card orders can be reversed if the partner disputes the charge. Virtually all issuing banks charge a fee of $25-50 for international wires. a reference to the bank (the bank's local code) and the beneficiary's domestic account number. When providing partners with wiring instructions. Make sure that payment terms clearly indicate that your prices are net of bank charges. are the partner's responsibility. high-volume products. but that is the ISV's expense SWIFT/BIC codes. always include your bank or branch SWIFT code. It is not uncommon for some partners to make purchases of several hundred thousand dollars per month with their Amex card. This is an alphanumeric code that is unique to every bank.
the instructions have to be followed to the letter. Things to consider: The creditworthiness of the issuing bank.000 purchase with an Amex card could result in a $3000 processing fee for the ISV Cashier’s checks and international money orders These are rarely used.g. especially in Eastern Europe. Letters of credit can be used to make a payment. there are companies that prefer to use checks. be it $US. e. so payments should only be accepted from companies that have been properly qualified Credit card payments are typically used by smaller partners who do not expect to build up a lot of volume (they will usually run into a problem with their card limit) Credit cards. In this case the distributor would make payments based on the terms provided.. A $100. and the wording has become tighter which can make them more difficult to cash in. The issuing bank Page 32 . or the ISV's local currency Encourage partners to use an overnight courier service when paying by check. it can be a good idea to have the letter of credit guaranteed (“confirmed”) by another bank that has a correspondent relationship with both your bank and the issuing bank The LC should be irrevocable The wording has to be precise. Things to consider: Make sure checks and international money orders are issued in the currency specified for payment. are not widely used outside the U. and if payment is being requested against an LC. correspondent relationship with the issuing bank.. and the ISV would only invoke the letter of credit in the event of a late payment. so this should not be the only way for a company to pay Banks will normally charge a 2-3% processing fee for each transaction. If your bank does not have a direct. Credit card fraud is widespread. to avoid possible postal delays Letters of Credit Letters of credit are still used for manufactured goods. but in some cases where partners have credit terms and pay monthly for their orders. so make this the responsibility of the partner. or to guarantee that the payment will be made. 30 days net. especially for companies.S. They can be issued for specific purchases. or for an amount that corresponds to the credit limit issued by the ISV. but because of widespread fraud and bank failures during the 1980s they are more complicated to get.
is going to protect the interests of not only its client. Invoking a standby letter of credit for payment is usually the result of a financial problem on the part of the buyer. so the bank will not cover the obligation unless it absolutely has to. Page 33 . but itself.
Sample Order Form Partner Name Purchase Order Number Ordered By Order Date Product Information Product Product Qty* License Qty* Unit Price Line Total Subtotal Shipping Total Purchase *Note: Please specify if the order is for additional licenses to an existing client Maintenance Table Maintenance Calculation List Price Multiplied by maintenance % Less: 90 day warranty period Total First Year Maintenance Less: Partner Discount Total Maintenance Fee Payment Information Wire Transfer Remit funds to: Note: This space to be used for ISV's bank information (bank name. SWIFT address. account number) Use the credit card you have on file: VISA MASTERCARD AMEX Page 34 . account name.
defined period of time for deals that he has already quoted in writing. but he should be required to document those to the ISV when the new prices are announced. usually 90-180 days.Price Protection The sales cycle for every product is different. but a partner has to have some assurance that the price he is quoting will be valid while the customer is going through the buying process. The standard procedure is to have new pricing go into effect 30 days after it has been announced. with an additional period of protection tied to the normal sales cycle. the partner can maintain the old pricing for an additional. In other words. Page 35 .
where marketing expenses.g. This is especially true in Europe. Sales in one quarter determine the discount for the following quarter. Discount structure could be: 40% for quarterly sales up to $125K at list 45% on sales in excess of $125K (equal to ¼ of the contractual minimum) 50% if sales exceed $175K Under this program they would get a 45% discount for any sales in a quarter following a quarter in which they had sales of $125K.. will be a fraction of the size of the U. taxes and government charges are much higher than in the U. a 50% discount is the industry standard. In many markets an on-site sales call is often necessary to close the sale. While it might be possible to attract partners with lower discounts. very few quality partners and distributors are willing to entertain products with less than a 40% discount. providing lead generation and technical support.S.. Page 36 .Discount Structure Discounts tend to be higher outside the U. their discount would drop to 40% for the next quarter. If their sales drop to $90K in that quarter. with the first trigger point based on achieving the quarterly equivalent of their contractual minimum (e. This would mean that their sales in a quarter would determine their discount for the following quarter.S.S. and this drives up the cost of sales. 30-40% might be enough to attract good partners and distributors if the company is established in the U. office rents. Individual markets outside the U. labor costs.S. The discount should be tied to how well they are doing compared to the business plan. For enterprise solutions and large platform products that require on-site visits. $125K if the annual minimum is $500K). so the potential revenues from a given product will be lower 2.S. they maintain the discount for another quarter. There are two recommended ways of setting up the volume discount structure: 1. 3. There are a number of reasons for this: 1.. In the U. installation and pre-sales support by the partner. Costs of doing business are usually higher. The markets are smaller. whereas internationally the discount tends to be 40-50%. If they exceed that number in the quarter. Rolling quarters. and they certainly won't spend much money promoting them.S.
The cost of the initial license(s) will reduce potential sales by much more than the initial revenues from the pre-payment The purpose of an up-front is usually to guarantee that the partner is serious about the product. but it has become the exception today: most partners that have been in business for any length of time have been burned at least once with pre-payments. Page 37 . and it is usually taken from the marketing budget. Deal size. For example: 40% for transactions under $50K 45% for $50-75K 50% for deals over $75K Customer Discounts It is usually a good idea to give the channel partner some level of discretion in offering additional discounts without getting approval from the ISV. Discounts are applied to the size of individual transactions as a way of encouraging the partner to focus on larger deals.2. and has a strong incentive to market it. or would be the responsibility of the reseller (he absorbs it). and the reseller discount would be applied against the net deal. without having to absorb all of the pain himself. Any customer discounts in excess of 20% would require approval from the ISV in writing. and as a result have made it a policy to pass on products that require up-fronts requiring up-fronts is seen as a sign of financial weakness on the part of the ISV up-front payments have to come from somewhere. and establishing a formal marketing plan and budget from the partner. they might be authorized to offer discounts of up to 20%. Should you charge the partner an up-front fee? This was a fairly common practice in the 1980s. leaving the partner with little or no money to push the product. For example. This can be better achieved through requiring training at the ISV's facilities.
1 to 3.0. which is why they have become more demanding.Maintenance Policies for License Sales Maintenance is becoming a "manageable" expense for many companies.. starting after an initial 90 day warranty period.. Technical support related to the installation and on-going use of the product. ISVs are normally expected to provide a new release at least once per year 3. e.1. New releases. maintenance is a significant fixed cost and more and more companies are taking a closer look at what they get for their maintenance dollars. provides first level (telephone) and second level (on-site) support to resolve problems directly related to the product. with some additional functionality. For large companies with thousands of installed programs. going from 2. voluntary annual maintenance. and after the product is stable and has a large user base. Voluntary The typical program is a rate of 15% (but large enterprise ISVs such as Oracle are pushing this to 18-22%). roughly half the maintenance fee covers the cost of providing tech support. Users that are on maintenance would usually get a discount of 40-75% off the list Page 38 . Large users know this. and mandatory annual license fee renewals. or his local partner. If the product is simple to install. when going from 2. The general rule is to provide users with new releases or upgrades within the same version number at no additional charge. and ISVs are being required to justify the value they are providing. especially if the product is expensive and the maintenance payment is a large one. In reality. users will look at the second component to see if they are "getting their money's worth". while going to a new version number. In addition the ISV provides code level support in the form of bug-fixes and maintenance releases that incorporate these fixes 2. The ISV. In theory this payment is used to cover three levels of service: 1. and requires no on-going support. Discount on new versions or chargeable upgrades.g. predictable revenue stream from maintenance revenues.0 to 2. users will be more reluctant to pay for chargeable upgrades. while the other half is used to reinvest in continuing developing of the product. e. As a result maintenance payments are no longer "automatic". most ISVs have an objective of building a recurring. There are two ways to structure maintenance. In theory. If the product does not require much support.g. constitutes a chargeable upgrade. a large portion of the maintenance stream goes to the bottom line.
they would have to pick up the missing maintenance or pay full price for new releases. or if there is some doubt about the financial strength of the software ISV. and wants to benefit from the discount (or has technical problems and needs support). who might have thousands of programs installed. if a client has used the product for 18 months without paying maintenance. it is becoming increasingly common to offer the first year free as part of the pricing. the maintenance payment goes up accordingly. prefer to make all of their maintenance payments at the same time. some software ISVs use large discounts on upgrades as a way to encourage companies to stay on maintenance. they would be required to pay for two years of maintenance.price of upgrades. Timing of payments Many large users. so that they can access it if the ISV goes bankrupt. at least for the purposes of calculating the maintenance. and few new products or clients. For this reason. or can no longer provide source code support. some companies will require that the source code be placed in an escrow account. If a client is no longer on maintenance. Resetting the maintenance Maintenance is calculated based on the list price of the product (not the actual selling price if a discount has been offered) the first year. and how many times per year a new version is released. For example. Other issues to consider in defining a maintenance policy Warranty period While 90 days has been the traditional policy. Some ISVs with a large installed base. have been notorious for increasing prices every year as a way of increasing their maintenance revenues. For this reason some companies insist on a limit on annual price increases. Escrow accounts If the product is critical to the client's operations. so if there has been an increase in the price of the product. It makes it easier for them to manage. the number of new features included. depending on: the cost of the upgrades. This is unlikely to happen with a product that is not mission-critical. usually at the beginning of the year. and then the current price list in subsequent years. and it also makes the total amount of Page 39 .
but not new versions Page 40 .maintenance they pay transparent. Recommendation: 15% maintenance One year warranty Industry is moving in this direction Lowers the barrier to sales Still build recurring revenue base for subsequent years Include maintenance releases. which generates a significant recurring revenue stream for the ISV. and it addresses some of the issues encountered with voluntary maintenance. the first payment is due on the anniversary date of the contract. and there is no initial warranty period. However. Mandatory Maintenance Mandatory maintenance is often referred to as an annual license renewal fee. in return the client gets all new releases and upgrades at no additional charge. Since it is a renewal fee. These companies are more likely to look at the value they are receiving. and the ISV is normally contractually obligated to provide new releases every six months. The amount is usually 20-25% of the list price.
The advantage of a zeroday key is that it prevents a user from simply reinstalling the product every 30 days. 45 or 60 days A permanent key is not issued until the ISV has been paid by the reseller Decisions have to be made regarding how the key is structured: Is it machine-dependent.e.. so a company should avoid having large receivables Credit Terms and the Use of Keys Software security keys are an excellent way to manage the sales and payment cycles. and permanent keys should not be given until the payment has been received (help the partner manage his collection cycle): the financial information received is often unreliable suing for payment overseas is difficult and expensive market conditions and exchange rates can change rapidly. so that prospects can try it for a month Renewals for trials would normally be 30-60 days if an extended evaluation is required. etc.g. 30. Page 41 . i.. e. a new temporary key would be issued that matches the payment terms.O. As a general rule payment terms are to be avoided. The disadvantage is that it creates another hurdle to a prospect evaluating the product. or is it a zero-day key that requires that a key be issued just to test it. does it read a serial number or does a serial number have to inputted by the user? This can make it easier to prevent unauthorized reinstallation (see below) Does it count the number of users.Credit Terms Payment terms will depend somewhat on factors such as the cost of the product. do you deliver an evaluation version of the product that lets the user try all of the modules. and potentially using the product perpetually without paying. software protection. The product would typically have a 30day evaluation period. but they have to have separate keys for the modules they want to purchase? Does it have an automatic 30 day key. length of the sales cycle. A new temporary key would be issued. Some of the issues to consider are: Temporary and permanent keys. or the amount of data that passes through the product? Are keys issued for each module? In other words. at the end of which the prospect has to either issue a purchase order or stop using the product Once the P. is issued. length of the relationship with the partner.
Germany. Spain.Recommendation: No credit terms Permanent key issued when payment received Use temporary keys to enforce payment policy Customize payment terms by territory 30 days for U. France.. Australia. Netherlands and Nordic 60 days for Japan.S. UK. Latin America 90 days for Italy Page 42 . Canada.
Many countries require withholding taxes on products imported to their country. The tax usually varies between 5-30%, and is deducted from the payment made to the ISV. If, for instance, the withholding tax is 20%, and the partner owes the ISV $1,000, he will send $800 in cash, and a tax certificate (issued by his government if it has a tax treaty with the ISV's own country) for the other $200. The ISV can then apply the tax certificate against his tax bill when he files his annual return, if his country has a tax treaty with that particular country. Things to consider: Latin American countries often have a withholding tax of 20-35% on software product sales and royalties Some countries, e.g., Italy, make a distinction between royalties and product purchases, and apply different withholding tax rates. It is generally considered a royalty if the partner/distributor has the right to duplicate the product media and resell it in his territory. It is a product purchase if the product media and documentation are physically imported. India has a flat withholding of 20% on all products and services The partner agreement will often require that the purchase price be paid net to the ISV, so the partner becomes responsible for paying the withholding tax. In that case the local pricing will have to be adjusted to compensate for the withholding tax, and this could impact the product's ability to compete Tax certificates will only be of value if the ISV reports a taxable profit. If he is losing money, or if the cumulative value of the tax certificates exceeds his tax liability, they will represent a potential loss of revenue.
Recruit and Hire an International Manager
Depending on the complexity of the software, a channel manager has the bandwidth to actively manage 5 to 20 partner organizations without additional personnel. For a product that is not overly complex the upper part of the range would apply. This person should be the partners‟ single-point of contact for any and all matters. Although orders do not need to be processed by the channel manager, they should pass through him/her. And likewise, although technical support questions do not need to be answered by the channel manager it is best that they (at least initially) pass through him/her. As the company‟s gatekeeper, the channel manager will be able to minimize the impact of channel partners on the company, while at the same time maximizing the value that the ISV brings to the partner. The channel manager will have a vested interest in making sure that partners are being taken care of, so it is less likely that a support question will stay in someone's in-box. Based on this, the most important qualities to look for in a person for this position are: Strong communication skills (speaking, writing and listening) Collaborative in nature (team player) Strong organizational skills Good understanding of business basics (they are going to be dealing with entrepreneurial business people) 5 to 7 years of business experience if the person is going to be fairly autonomous in their position 2 to 5 years of business experience if reporting within a structured environment Independent and assertive enough to champion partners‟ interests and needs within the ISV organization as well as to represent and enforce the ISV‟s position with partners
Positions that might be similar in nature to this might have titles such as: Marketing Program Manager, Product Marketing Manager, Customer Support.
Company and Product Profile
The purpose of the company profile is to give the partner information about your company in an organized format. The checklist in this questionnaire is designed to compile much of the information that a prospect will be interested in knowing. Some of the information will be confidential and you may want to have a prospect sign an NDA before making it available. Once the information has been compiled, it is often useful to put it into narrative form, a descriptive overview of your company and technology that might be 4-6 pages long. This gives your partner a “story” to tell when he is dealing with his prospects, who often want to know more about the company that is behind the product. It also gives the partner a document for internal use. Salespeople tend to come and go in an organization, and by having a detailed profile on hand, it makes it easier to bring a new salesperson up to speed on the ISV and his products.
1) The Product (a) Product Background (i) What does it do? (ii) How does it do it? (iii) What is the operating environment (operating system, platforms)? (iv) What is the suggested retail price and typical configuration (examples)? (v) What is the Return on Investment for an end user? (vi) Why do people buy it? What are the business benefits? What is the single most compelling reason for buying the product? (vii) How large is the installed base (clients, sites and seats)? (b) Product life cycle (i) Why was the product first developed? (What was the “aching need” it solves?) (ii) When was the first release? (iii) Summary of the release history (iv) Current release and version number (v) Development plans
O. e-mail address. their costs and quantity available: (i) Demonstration or evaluation units (ii) General Information Manual (iii) Customer testimonials/case studies (iv) Published product reviews and comparisons (v) Industry studies.. e. direct line..g. how many are dedicated to this particular product: (i) Marketing (ii) Development (iii) Tech support (iv) Administration (v) Other (c) Ownership and management structure (i) How much of the company is owned by management? (ii) Are there any significant outside investors? (iii) Please provide a profile of the key management people. and if so. for your key management people? 3) Sales and Marketing (a) What marketing materials are currently available? Are any of the following available. and of these. Gartner Group (b) Sales cycle? (i) Is the sales process a primarily “technical” sale or a “financial” sale? (ii) Describe the primary marketing methods the company uses to generate interest in its products. (iv) What is the contact information. how long does this typically take? How much resource from the company is required to ensure a smooth evaluation? Can the evaluation take place at the Page 46 . issue? (iv) What are the typical steps in the sales process? (v) Is an evaluation critical to the sales process? If so. i.e.2) The Company (a) When and why was the company started? (The aching need?) (b) How many full-time equivalents are employed in the following areas. (iii) How long does the sales cycle typically take from initial customer contact to P.
either by the number of seats they have purchased. or $20-50 million iii) 1. what is involved? (viii) Does the product typically generate service revenues as part of the sale? If so. or $5-10 million revenues ii) 2.000-4.999 seats – 18%. or $10-20 million iv) 250-499 seats – 14%. what is the ratio between service revenues and the sales value of the product itself? 4) Pricing a) What is the average transaction amount? b) Are there financing options? c) What are the volume discounts.customer site? (vi) What people. For example: i) Banking and insurance – 23% ii) Retail industry – 18% iii) Wholesalers – 17% iv) Health care – 14% v) Automotive – 10% b) Can you list the size of your five biggest customer groups.000 seats – 10%.000-1. or $50-100 million c) Do you have a published customer list? i) What customers have agreed to be contacted as references? ii) Can these names be given out to potential customers? 6) Competitive analysis Page 47 . or by the company revenues. are typically involved in the decision-making process? (vii) Does the sale require extensive pre-sales tech support? If so. if any? d) What percentage of sales are typically made at full retail price? e) What is the average discount given to the customer. if available? For instance: i) 500-999 seats – 23%. and the percentage of your sales that comes from each.000-10. by title. and for what reasons? 5) Customer profile a) Can you list the five industry segments that make up most of your sales.999 seats – 17%. or $2-5 million v) 5.
good and bad? iii) What are the prices? c) Why would someone buy the competition's product. and how do you compensate for this? d) Marketing Information i) What distribution channels do they use? ii) Do they have any major references that you are aware of? iii) What international markets are they in? 7) Why are sales lost? 8) What are the ten most frequently asked questions about the product.a) Competitors‟ company information: i) How many are there? Who are the primary competitors? ii) How large are they? iii) What is their relative market share? iv) How many installs do they have? b) Product information i) What are the product name(s)? ii) What are the differences. and the answers? a) Question 1 b) Question 2 c) Question 3 d) Question 4 e) Question 5 f) Question 6 g) Question 7 h) Question 8 i) j) Question 9 Question 10 Page 48 .
microsoft. and how to position your products against features that your competitors might have. sometimes as part of a larger suite that has overlapping functionality. If there are many known competitors. every effort should be made to benchmark those products. It is important for the channel partner to know everything about your product and how it compares with other offerings. analyst reports and competitive intelligence that can be used to position Microsoft-based solutions: https://partner. and it has to be more than a checklist of features that you have and others don‟t.com/US/salesmarketing/competitiveintelligence Page 49 . Microsoft Resources The partner site provides industry research. If the ISV or the partner can identify the major competitors in the target market. he will lose faith in you and your product. If your partner finds himself in front of a prospect and gets blind-sided by questions or comparisons that he is not prepared to respond to. good and bad. the matrix should be limited to those that have the largest market share and/or have the highest profile. The competitive matrix should be as complete as possible. Your partner needs to know which features to emphasize. sometimes with virtually the same functionality.Competitive Matrix Every product has competitors.
In the U. and the second when the potential client has to sell the investment internally to the finance department. And to the extent the ROI analysis can be illustrated with real life examples or case studies. 30 years of IT procurement “disasters” and a more widespread general understanding of technology in the business process have forced a mandate on the CFO to question the returns from technology investments. In many cases the ROI has to be proven in a pilot installation over a relatively short period of time before a client will purchase a larger license and roll out the product throughout their organization. the purchasing process in main-stream large companies has changed over the past few years.ROI Analysis Once beyond the “early adopter” sales. and for large purchases the benefits have to be quantified. while in Europe we would suggest it tends to be a bit longer. Purchasing decisions are determined more and more by financial. the purchase process for large licenses can be accelerated. rather than technical factors. the impact will be greater. The compelling case is to prove pay-back in hard $ and reinforce confidence in the decision through a valuable collection of important but unquantifiable benefits. they have to either reduce costs or increase sales. Technical solutions now have to do more than just solve a problem. the benchmark is an ROI of 12-18 months. in the range of 18-24 months. By providing partners a tool or model with which to document the potential ROI. The potential client is given the financial justification he needs to get budget approval internally.S. Page 50 . The practical implication is that the selling process is often two-phased: the first is selling a solution to the department that has the problem. The ROI analysis could be a relatively simple spreadsheet that includes the cost factors that will be reduced or eliminated by using the product. where purchasing decisions are typified by a CEO driving the purchase.
com/US/program/competencies/isvsolutions/40013153 Create ROI Analyses for these solutions: Customer Relationship Management E-commerce Enterprise Resource Planning Financial Management Human Resource Management Retail Management Systems Supply Chain Management Templates include: Microsoft Office programs Enterprise storage Security management Page 51 .microsoft.Microsoft Resources ISV partners with a competency can access an ROI calculator on the following site: https://partner.
Typical cost of mailing lists Cost of mailing Cost of materials For any marketing materials ordered from the company: . and what does not.Establish method of payment The time associated with each step Preparing a mailing Delivery of mailing Typical customer response times Time on telephone with prospects Time to close a prospect Success ratios of various steps (i. . sales volumes) . Although these will be the company's own costs. 100 mailings produce 20 calls which lead to 10 sales) Steps to Include Time-line for campaign preparation and implementation List selection Successful industries in the domestic market Description of characteristics as to why those industries are successful (this is important. will build a knowledge base of what works.e.Documenting the Sales Process Every company..Technology base (complementary technologies already installed) - - Page 52 .Company size (number of people/number of PCs.Establish minimum orders . through its own marketing efforts. it will give partners a benchmark to budget from. because the nature of industries may be different from country to country. Some of the areas this should include are: Document the steps in the actual sales process and provide support information for each step Note any dialogue that might be associated with any particular steps Most common questions/answers for prospects calling in Scripts for any type of outbound telemarketing Most successful techniques in closing a sale The costs associated with each step.Type of company infrastructure (large/small IT support staffs) . Documenting its own sales and marketing processes will improve the direct sales effort as well as provide partners with an invaluable tool.Establish quantity pricing (Don‟t forget freight – or indicate freight collect) . The partners can use the successful demographics to identify the most appropriate industries in their market.
e. PO.Hard copy . Graphics Manager.- - . CIO. etc.Digital elements of marketing materials (i.) Copies of marketing materials used .) Page 53 .Other Most successful professional titles (i. CEO.e. copy) Follow-up process Process for closing a sale Terms and conditions with customer (credit card. pictures. etc. logos.
ISVs should develop 2-6 pages of templates using HTML that they can pass along to the partners.com/US/40019331. and when an ISV‟s product appears on a lousy website it is going to reflect poorly on the product no matter how wonderful the product might be.Pre-designed Web Pages Partners and distributors are known for having lousy websites. The partners can translate the text. The best place to start is https://partner. Microsoft Marketing Resources Microsoft‟s partner page contains a wide range of tools and resources to help their partners build and implement effective marketing programs. and post them on their company site. and it saves the channel the time and trouble of trying to come up with something on their own. which contains links to: Sales and Marketing Resource Guide for Partners Marketing collateral Logo Builder Photo Library Structured marketing campaigns Page 54 .microsoft. where necessary. This allows the ISV to control the presentation of their product worldwide.
Software Translation and Localization
A common misconception amongst software ISVs is that, in order to sell their product in foreign language markets, all that needs to be done is to take the text strings in the product and re-write them. Reality, however, is somewhat different. To avoid a costly failure, consideration must be given to all of the work required to properly prepare a product for operation in another language. This process is usually referred to as “localization”. Localization is more than just changing the language of the words in the product‟s vocabulary - otherwise there would be a temptation to call it “translation”. True localization takes into account a number of technical and cultural factors as well as the target language itself. The resulting localized product looks and feels right to native inhabitants of your target market country. Localization is the sum total of all the changes of language, usage, program code, and technology that need to be made to your product in order to offer a product of equivalent industry standard in a foreign language market. Indeed, many localization issues can also occur between two markets with a common spoken language. For example, there are many differences of spelling and usage between the US and the UK. Localization is actually a very specialist subject and you will be faced with the task of either building this specialty within your organization, or using external sources of help. Below we have picked just four facets of localization to illustrate the level of fine detail that needs to be considered when producing a high quality product. Translation This is clearly the fundamental constituent of a localization project and there are four main factors that need addressing during a translation. First is the translation of the text of the many components of the product from its original language to the target language. Second is the character set. Look at the keyboard of your own PC. In many markets, we use a “qwerty” keyboard specifically designed for entering English text. A German keyboard is different. A French one is different again. They have been optimized for slight differences in the frequency of characters used, as well as for the use of accented characters. Third are character codes. Behind the keyboard layout is the question of how the computer recognizes the characters that are being entered. There is no (not in
common use anyway) single set of computer codes that can handle all known languages. Luckily in Western Europe there is such a common code set, but the keyboards differ even so. Fourth is the length of the text strings. Text length provides a real challenge to the user interface designer. Screen layouts shrink and grow dependent on language. For example, German needs nearly 50% more space than English to convey the same meaning. A title or message that only just fitted in the available space in English could precipitate a screen re-design in German, if you believe, as we do, that interface design is very important, then simply stretching or squashing to accommodate foreign words is going to look (and be) second rate. Related to text length is word length. Particularly notorious in this respect are the Germanic languages with their frequent use of compound words. Simple algorithms for finding words in blocks of text, that we take for granted in English, do not work in German. Screen layouts that rely on lists of (“normal” length) words are frustrated by Germanic spelling. Counting and Time Keeping There is a wide variation, even over a limited geographic region such as Western Europe, in the way that numeric information is displayed. There is a similar diversity in culture that seeps through into computer software “look and feel”. Arithmetic is handled in the same way in all Western languages. What differs is the way the numbers are represented. The commonest example is the US practice of writing mm/dd/yy for a numeric date contrasted with the UK usage of dd/mm/yy, which can result in ambiguity with dates such as 5/6/2006. Equally, the French practice of transposing decimal points and commas in numbers (e.g. “1.000,1” for 1,000.1) needs to be catered for. Currency notation is also quite different from region to region. This can range from prefixed special characters (e.g. £1 or ¥200) to prefixed alphabetic strings (e.g. FF1,0 and DM 3.0) to suffixed alphabetic strings. Holidays also have significant regional variations (e.g. don‟t assume December 25th is Christmas Day). If your application has a diary facility then these factors need to be taken into account. The best quality products show the consumer that the product has been designed with this in mind. Application Specific Variations
This is a “catch all” category for sweeping up those things in your own product that may not function correctly in another region or culture. Any part of a product which is driven by, or assists in meeting, laws or regulations in the home market will very likely require modification to fit different rules in the target market (e.g., finance). Any application where alphabetic ordering was important may produce different results in different languages - and would be virtually impossible to operate in some Asian languages. An application that operates across national boundaries can also cause problems. Simple electronic mail is an example of this in that many systems do not cater for different character sets and languages, never mind different document formats. The Whole Product There are constituent elements of the product that, whilst not strictly software, may need to be localized. A simple example is the Software License, normally displayed on the user‟s screen at the time the product is started up. You need specialist legal help to get this translated, since the minutiae of the rules vary from country to country. Copyright notices are similar in this respect. We would include in this section any tools you use to manufacture and support the product. If a regional support office is to be set up, then will the help desk tool you currently use also work in the local language? Other examples are the product packaging, marketing collateral, training materials and any internal technical support documentation. Also of course, are the language variants of your website. Performing a Localization The first step, assuming this product has never been translated before, is to survey the product for the kind of localization issues we described earlier. It is essential that this survey is accurately done. Only then can cost and the project time scales be calculated. Indeed it may reveal hitherto unknown issues that completely change the commercial viability of the venture. This is a skilled task and it is best performed with the help of someone who has had previous experience of localization. Once the survey is complete then the project can be planned. From here onwards there are several methods of translation: 1. Do the complete project in house using your own permanent staff 2. Outsource the complete task to a translation specialist 3. Use your local re-seller to do the translation
This may not only save translation costs. Page 58 .namely that you keep the project under your direct control. If a high level of change is required to the product‟s code. On completion of the software translation the product should again be tested for function. It is absolutely essential that contemporary translations having exactly the correct shade of meaning in the target language are found for the English terms in your product.4. When a product has already been localized once or twice. This can only be achieved by someone who is not only a native target language speaker but is also computer literate and familiar with the translation of technical software. For most Western European languages there is a pool of expertise that can be hired on subcontract terms for a specific project. since text changes often reveal bugs that have been dormant in the product. it may be possible to ship a translation “toolkit” with the product which would enable distributors and resellers to do a translation. and use specialist sub-contract effort to supplement your skill set. The software changes needed for the localization should now be done. For most average sized products one or two translators should finish the job in a few weeks. The actual boundary between what your company does and what the sub-contractors do is highly dependent on the degree of code change to your product that is necessary and the level of resources that you are able to deploy onto the project. For Microsoft Windows based products much of this material has already been made available by Microsoft and can be accessed freely. Following that the language elements of the translation should be independently checked. This is a list of all the specialist words that are visible in the software and documentation. The typical project commences with a translation of the vocabulary of the product. but it can also form a component part of the overall commercial arrangement you have with those particular resellers. and the product tested for correct operation. Now the software translation proper can begin. then outsourcing this change would be both expensive and high risk. Translation of the glossary is the key quality step in the project. usually called the “glossary”. For most software ISVs embarking for the first time on product localization we would recommend the fourth method . This step is so important that the glossary translation should be independently checked. Manage the project yourself and hire specialist sub-contractors The first of these is inappropriate for a small company because the cost of full time employment of the specialist (linguist) staff would be prohibitive. The second method can also be very expensive unless the project is a very simple and straightforward translation.
Be prepared to test the product well. then not only is it difficult to translate the operational parts of the documentation but the diagrams and screen shots in the documentation cannot be included. the help text and then the documentation can be translated. Localization will inevitably bring to the surface bugs that have been dormant in the product. it is impossible for your (source territory) staff to have a view of a translation‟s target language quality. Therefore this extra step of checking. It will depend very much on which customers. Ideally. get a customer or a local office involved for a final approval of the linguistic style and content. The translator must have high levels of computer literacy and be familiar not only with the application being translated. but also with the vocabulary being used. by a customer. Time spent on this activity at the start of a project can save considerable cost in wasted translator effort and expensive re-work later on. gives you the confidence that the product is ready for market. until the translated operation of the product has been established. It is best to keep to this sequence because. Always check translations at least once using an independent translator. and what their documentation needs are. or potential customers. Translation itself is a skilled task. It is not always necessary to wait until the documentation is available to start this test.Once the software translation is complete and checked. Speaking the target language is not enough. and to budget for sufficient technical support and bug fixing activity. Page 59 . We would recommend that translated software is always beta tested. The survey stage is essential to scope and plan the rest of the project. By its very nature. In conclusion we reiterate the critical success factors in any translation project: We cannot over emphasize the value of good preparation. You are always reliant on the judgment of third parties. are available for beta testing at the time.
the benefits of using the product in those environments should be detailed. complications or performance issues that can have in impact on the functioning of the product in different environments. there may be configurations that make it easier to sell and install the product. More important. Along the same lines. For example. the extent and nature of the integration should be documented. An ISV should document known problems. or with other applications.Integration Issues & Complementary Technologies Many products are installed in a complex environment where they have to interact with other technologies. so that the channel partner can identify clients or prospects with similar configurations. if the product integrates with applications from certain software companies with a large installed base. Page 60 .
the additional local resource will be of considerable value in promoting the channel program Whether you are prepared to operate the HQ technical team during regional business hours. Another support option to mention is that you could consider outsourcing technical support to one of the many outsourcing companies. it is available via a quick telephone call or email. Management of this extra load needs to be addressed prior to rolling out a partner recruitment program to help ensure that a partner's first experiences in accessing the ISV‟s support organization are positive. proper initial partner training and good technical support documentation are a critical base to ensure that the support burden of adding a new partner channel will not will not overtax an ISV‟s technical support infrastructure. As discussed below. one of the key decisions for a company is whether to support the channel from home or whether to open a support office elsewhere. it should be kept in mind that regardless of the technology. serious consideration should be given to hiring these staff in the key regions. some overlap will probably be required in order to provide support for key markets.S. However. However. which will need to be planned for and managed. Although office costs must obviously be considered. U. If an ISV can manage a quick turnaround response on all support emails from his home location. This will help reinforce their decision to partner with you. If this number suggests that you will need to hire one or more additional technical support staff in some location. Therefore. it may be quite feasible to provide support from the HQ for at least an initial period of 6-12 months or more. whereas initial negative experiences will give the partner reason to doubt their decision. and UK partners are rather “spoiled” about the accessibility of support from most of their ISVs. if it is expected that a reasonable number of partners will be joining the network at approximately the same time. The increased cost of supporting an international channel and the objective of maintaining committed partners should put “low maintenance” even higher up the development priority list. Usually. there could be an initial bump in demand for technical support resources. This has become an increasingly popular way for software companies to reduce their fixed costs. partners will go through a learning curve. Of course. there are certainly drawbacks: Loss of control over quality of service Page 61 . Beyond this. Some considerations regarding this decision include: The number of partners and software partners that you decide to add in year one.Providing Technical Support to Channel Partners The greatest impact on future support requirements is in engineering within the product itself.
it would be wise to provide some overlap of hours for an initial period. Even if the company opens a local support office. the time delay makes it more difficult to get any additional information the support team requires to answer the question. This does not mean that an ISV has to have people sitting in the office waiting for calls. Technical Support Hours If an ISV decides to provide all partner support initially from its HQ. Technical Support Communications Page 62 . when there is not a person officially designated to provide international partner support. in general. or at least provide overlap of several hours per day. It also means that the international partners should be top priority for that person. it will be necessary to maintain technical support hours that coincide with the normal business hours in the key markets. This does not mean that the person is solely dedicated to international partners. initially it can be handled by making sure that at least one technical support person is available by cell phone. This is undoubtedly a key obstacle to recognize and overcome before the first partner is on-board. so continual training is needed Still requires back-up support in company's HQ support team and development team Technical Support Staffing If the company is providing support from its HQ. it seems less urgent. until the local staff is sufficiently well trained to respond to all levels of questions. all inbound support requests from international become a low priority and the partner level of satisfaction drops significantly. May not capture info that would assist you in improving product functionality and features for the international markets Tendency toward high turnover in outsourcing companies. Therefore. when in reality time delays mean that they should always get first priority. It just means that when there is a call or an e-mail. Almost without fail. so that the manager can be kept “in the loop” via “cc: e-mail” or other means in order to monitor a partner's overall progress. The designated international support person and the international manager should be working as a team. and because the communication is often by e-mail rather than phone. support requests from international partners are more time-consuming to deal with. the designated person is responsible for it. The questions tend to be more difficult and are often worded more vaguely. the requests tend to get shifted to the bottom of the pile. This is true because. there should be at least one tech support person (and a back-up to cover for holidays and illnesses) designated to provide support to international partners.
It will be important for an ISV to maintain this level of responsiveness as a minimum. Generally. and if there is going to be a delay. It will be important to provide partners with this information in a format that can be quickly searched.Due to time differences most technical support questions will come in the form of e-mail. The key issue for partners will be that answers are provided quickly. partners will tend to send e-mail before the close of their business day with the expectation that they will receive an answer the next day. this can be done on paper. that they be notified and advised when a solution should be expected. Page 63 . on disk and/or provided access to the knowledge from a secure area of the website. Technical Support Documentation ISVs should be able to identify some of the most frequently asked technical support questions. Depending on the amount of data.
they should seriously consider having an attorney complete a patent search before any significant investments are made. A patent search is a relatively inexpensive way to determine if a product could potentially be infringing on an existing patent. without going through the expense of perfecting a patent. Patent and Trademark Office (USPTO) approved roughly 40. and lose. and if you are sued.htm Page 64 .europa.S.: http://www.000. and many of these were business process patents. and when done in conjunction with a patent search the total cost will be in the range of $20-25. It is also important to register company trademarks. In 2006 the U.eu/en/mark/marque/efentry. “Patent trolling” (where companies hold patents without actually making anything. While we strongly recommend using a law firm for the formal search. is to get an FTO (“Freedom to Operate”) from a law firm that specializes in intellectual property rights. the law firm is responsible for the costs. a company can complete an initial search on its own by using www.IP Protection If an ISV is planning to do business in the United States. On-line searches and applications can be processed on: For the U. This is effectively a guarantee that your technology does not infringe on any existing patents.google. It is surprising how many companies will start selling their product. It is an excellent “insurance” policy. and look for opportunities to sue anyone that might infringe one of their patents) has become big business in the U.000 software patents.com/patents.uspto.S.gov For Europe: http://oami. A first level of protection. recruit partners or hire employees without first determining whether the name can even be used.S.
We may contact you to request additional information about your company. Once this form has been completed. please e-mail it to _____________. marketing strategies and financial position. The information you provide will help us evaluate whether the products and your capabilities are a good match. If there is anything else you would like us to know as we review your application.Partner Application Form Instructions: This form is the first step towards becoming a Channel Partner. please include additional sheets or materials. Company Name: Address Telephone Fax E-mail Address Website URL Primary Sales Contact: Primary Sales Contact Phone: Primary Sales Contact E-mail: Primary Technical Contact: Primary Technical Contact Phone: Primary Technical Contact E-mail: Year and Place of Incorporation: Parent Company: Public Company (Yes or No)? Current Fiscal Year Revenue: Last Fiscal Year Revenue: Page 65 .
Last Fiscal Year Revenue Sources: Hardware sales: Maintenance/Support sales: % of sales Consulting services: Training sales: System Software sales: Solution Software sales: Custom programming services: Other: Price range of sales Employees: Total: Sales: Marketing: Support: Training: Consulting/Services: Description of your company‟s main activities / strengths / expertise: Description of your customer base and activities relevant to this product: How would you market this sort of product? Page 66 .
Travel & Tourism Insurance Manufacturing Pharmaceutical Retail Technology Telecommunications % of Revenue Page 67 .Please indicate the type of value your company provides to your customer base (Yes/No): Custom Hardware Hardware Maintenance Network Design & Consulting Systems Integration Systems Design Needs Analysis Project Management Vertical Industry Software Software Support Custom Software Training Systems Evaluation Consulting Facilities Management Total number of customers What % of your sales in the past 12 months went to: Small business (1-99 employees) Medium Business (100-499 employees) Large Business (500+ employees) Government: What vertical or horizontal markets does your company concentrate its selling efforts on: Market Segment Agricultural Automotive Banking and Finance Construction & Engineering Education Energy and Utilities Government Health Care Hospitality.
Transportation and Logistics Others Please list all the major software products you currently sell: Product and ISV Name Exclusive? (Yes or No) Please provide contact details for two (2) current ISVs that we may contact Company Name Contact Person Telephone Number E-mail Address Company Name Contact Person Telephone Number E-mail Address Page 68 .
except to those employees who are required to have the information in order to evaluate or engage in discussions concerning the contemplated business relationship. Recipient agrees not to disclose any Confidential Information to third parties or to employees of Recipient. Nothing herein shall obligate Company or Recipient to proceed with any transaction between them. Company and Recipient wish to explore a business opportunity of mutual interest and in connection with this opportunity. include any information which Recipient can establish (i) was publicly known and made generally available in the public domain prior to the time of disclosure to Recipient by Company. ("Company") and _______________________________ ("Recipient"). "Confidential Information" means any information disclosed to Recipient by Company. 1. Purpose. either directly or indirectly in writing. in the same manner in which such notices were set forth in or on the original. in its sole Page 69 . 2. Company may disclose to Recipient certain confidential technical and business information which Company desires Recipient to treat as confidential. including without limitation documents. without confidentiality restrictions. Recipient agrees that it shall take all reasonable measures to protect the secrecy of and avoid disclosure and unauthorized use of the Confidential Information. software or other tangible objects which embody Company's Confidential Information and which are provided to Recipient hereunder. Confidential Information shall not. Recipient shall immediately notify Company in the event of any unauthorized use or disclosure of the Confidential Information. samples and the Company's plant and equipment. (ii) becomes publicly known and made generally available after disclosure to Recipient by Company through no action or inaction of Recipient. No Obligation. Maintenance of Confidentiality.Non-Disclosure Agreement THIS NONDISCLOSURE AGREEMENT (this "Agreement") is made and entered into as of between ABC Software. 5. Inc. prior to any disclosure of Confidential Information to such employees. Recipient shall reproduce Company's proprietary rights notices on any such approved copies. Confidential Information may also include information disclosed to Company by third parties. at the time of disclosure by Company as shown by Recipient's files and records immediately prior to the time of disclosure. 3. Without limiting the foregoing. prototypes. Recipient shall not make any copies of Confidential Information unless the same are previously approved in writing by the Company. Recipient agrees not to use any Confidential Information for any purpose except to evaluate and engage in discussions concerning a potential business relationship between Recipient and Company. Non-use and Non-disclosure. orally or by inspection of tangible objects. Recipient shall take at least those measures that Recipient takes to protect its own most highly confidential information and shall have its employees who have access to Confidential Information sign a non-use and non-disclosure agreement in content substantially similar to the provisions hereof. 4. Recipient shall not reverse engineer. and each party reserves the right. disassemble or decompile any prototypes. however. or (iii) is in the possession of Recipient.
Recipient agrees that any violation or threatened violation of this Agreement will cause irreparable injury to the Company. No Warranty. REGARDING ITS ACCURACY. Nothing in this Agreement is intended to grant any rights to Recipient under any patent." COMPANY MAKES NO WARRANTIES. ABC Software. to terminate the discussions contemplated by this Agreement concerning the business opportunity. 7. 9.discretion. Any failure to enforce any provision of this Agreement shall not constitute a waiver thereof or of any other provision hereof. Return of Materials. and Company assumes no obligation. ALL CONFIDENTIAL INFORMATION IS PROVIDED "AS IS. except by a writing signed by both parties hereto. mask work right or copyright of Company. Inc. 6. COMPLETENESS OR PERFORMANCE. No License. IMPLIED OR OTHERWISE. with respect to any information disclosed by Recipient. _______________________________ By: Title: Date: Recipient _______________________________ By: Title: Date: Page 70 . EXPRESS. Miscellaneous. This Agreement shall be governed by the laws of ___________________. 11. nor shall this Agreement grant Recipient any rights in or to Confidential Information except as expressly set forth herein. Term. This Agreement shall survive until such time as all Confidential Information disclosed hereunder becomes publicly known and made generally available through no action or inaction of Recipient. This Agreement may not be amended. nor any obligation waived. Recipient Information. 8. 10. Company does not wish to receive any confidential information from Recipient. This Agreement shall bind and inure to the benefit of the parties hereto and their successors and assigns. entitling Company to obtain injunctive relief in addition to all legal remedies. This document contains the entire agreement between the parties with respect to the subject matter hereof. Remedies. either express or implied. All documents and other tangible objects containing or representing Confidential Information and all copies thereof which are in the possession of Recipient shall be and remain the property of Company and shall be promptly returned to Company upon Company's request. 12.
travel. to enable XYZ to market the Products in the Territory. with overall responsibility for designing. Training. Territory. Time is of the Essence. in the English language.. Sales and Marketing Support. The initial term of the agreement will be one (1) years. ABC will provide XYZ with samples. to market and support ABC products in a defined territory. 10. a company organized under the laws of ______ ("XYZ"). ABC Technology. XYZ will be responsible for providing first and second level support to its clients. Sales Minimums. 8.ABC 1. a _____________ corporation Name:________________________ Signature: _____________________ Title: _________________________ Date: _________________________ Page 71 . Marketing Plan. 2. Inc. a ________ corporation Name:________________________ Signature: _____________________ Title: _________________________ Date: __________________________ XYZ Company. of materials. The price to be paid by XYZ for licenses purchased from ABC shall be __% of the list price (attached). Relationship. 7. XYZ will sell a minimum of ____ (__) licenses during the ___ (_) month period after completion of the training program. XYZ agrees to provide. ABC will initially train XYZ personnel for one week at its facilities in ________. unless renewed by mutual consent. documentation.. presentation diskettes. 2006. promotional material. 4. accommodation and subsistence costs of its personnel when attending the training. XYZ also agrees that it will assign an experienced sales and marketing executive as the product manager. at which time this Heads of Agreement will expire. proposes to grant a partner agreement to XYZ Company. Product Pricing. a company incorporated under the laws of _____ ("ABC"). XYZ will send one marketing and one technical person to the training scheduled for the week commencing ______. It is the intent of ABC and XYZ to enter into a definitive agreement on or before ______. sample letters. as an addendum to the definitive agreement. ABC will grant XYZ the non-exclusive right to market ABC products (the "Products") in ______________ (the "Territory"). 2007.Letter of Intent: XYZ Company . 3. XYZ will be responsible for the salaries. Technical Support. Inc. implementing and maintaining the marketing and support programs. 9. The agreement will include renewal options on terms and conditions to be agreed upon. a marketing plan which will provide an outline of the specific steps XYZ intends to pursue in order to market and support the Products. 6. 5. ABC Technology. ABC will be responsible for providing source code support and bug fixes. and such other material as may be available in the English language. and a minimum of ____ (__) licenses during every six (6) month period thereafter. Term. Subject to meeting certain conditions as outlined in this Heads of Agreement.
Page 72 . as long as there are established targets that have to be achieved in order to maintain the agreement. renewable for additional one year terms as long as the terms of the contract are being met. This works well when there is no reason to trigger a review of the agreement prior to renewal. especially with complex solutions that have a long sales cycle.Formal Contract Term The term may depend on the complexity of the technology. The standard term is one year. The second is renewal only if the renewal is agreed in writing by both parties 30 or 60 days prior to the expiration date. or if there is a good reason to force a review before renewing. In principle there is nothing wrong with this. the size of the market and the sales cycle. some channel partners insist on three or five year terms. Renewal can occur in two different ways. In some cases. This is useful when there is some concern about the relationship prior to getting started. The first is an automatic renewal unless terminated in writing by one or both parties within a defined time frame. usually 30 or 60 days prior to the anniversary date of the agreement.
While it is rarely a good idea to provide formal exclusivity. Scotland and England. The English distributor should be located in the Southeast. Both countries are so small. check out the references and find out if the partner is an above average producer Legal implications – in some countries terminating an exclusive distributor could result in the ISV being liable for an indemnity payment to compensate the distributor for lost revenues – it is better to refer to them as the “sole” partner as opposed to “exclusive”. even if it isn‟t important to them. and wrongly. someone who hasn‟t made an investment in the product The installed base of users might be too small to support multiple partners. treated as a single market: Territory UK and Ireland Subdivision .g. that it is difficult to subdivide further based on geography Partner based in the Paris area (60% of the business activity in France). This is often the case with mainframe products.. and sold mainly to government agencies or large companies that are required by law to put a purchase out to bid if there are multiple suppliers. with semi-annual or annual targets that have to be met in order to maintain it.comments Separate partners for the Republic of Ireland. here are some general guidelines for different countries and regions that are often.Exclusivity Whether or not to grant exclusivity is one of the most difficult decisions in establishing the relationship. The bid process can add 3-6 months to the sales cycle Things to consider: Exclusivity must be performance-based. there can be good reasons for granting “control” for a defined geography and/or a vertical market: It simplifies the management process if there is only one primary business partner in a given territory The partner has a real incentive to invest in marketing if he knows that he will not be undercut in price by another partner in the same territory. For products that have a large market. and perhaps one in the southwest (e. Most partners ask for exclusivity as a standard procedure. or in smaller territories The product is expensive. even if the term is for several years The primary business partner should have a program to develop an indirect channel for the product. Separate partners in Belgium and the Netherlands. which accounts for 60% of the business activity. especially if there is an extensive user base Does the partner have exclusivity with other ISVs. Bordeaux or Toulouse) and one The Benelux France Page 73 .
while it no longer makes sense to Taiwan work through a company in Hong Kong to cover China. Within Australia. Malaysia. Australasia Australia and New Zealand can be split out. Vietnam. Bangladesh and Sri Lanka are often treated as a single market. and can support three or four partners (Mumbai. but Thailand. Indian sub-continent India. Southeast Asia The ASEAN countries (Thailand. Companies will often have a partner in Spain covering both countries (the “Iberian Peninsula”). Singapore. Piracy is a big problem in this region. 90% of business is done in the corridor between Sydney and Melbourne.g. The other markets are small enough in terms of IT purchases that they can be covered by a single good partner that is based in any of a number of countries. Lyon). Indonesia and the Philippines could support separate partners for certain products. Germany itself is a large country.in the Southeast (e. Partners or distributors with local subsidiaries in each market would be an exception. India is large geographically. China. Kuwait and Oman are more Westernized than Saudi Arabia. Software piracy is rampant in China. North. so software protection is a big advantage. Sweden and Denmark share some language similarities. but also a problem in Hong Kong and Taiwan Page 74 . Iberian Peninsula Spain and Portugal should have separate partners. Singapore. and for most products it would be better to use different partners in those markets plus Finland. Malaysia. for example). The United Arab Emirates. but they are all quite large geographically. New Delhi and Bangalore. and the old East Germany) or more regions quite easily.. Indonesia. Pakistan. which are only an hour apart by plane. and can be subdivided into three (South. unless they have a local subsidiary. Nordic market Norway. Outside Singapore software piracy is rampant. Middle East Israel can never be combined with other countries in the region for obvious political and cultural reasons. Hong Kong and Taiwan should be a separate territory. but it can be more productive to have separate partners for Switzerland and Austria. but they should have separate channels. but old cultural animosities make it difficult for a Spanish company to sell successfully in Portugal. the Philippines and Brunei) are usually grouped together. A French partner will usually market into the French speaking parts of Belgium and Switzerland as well. German-speaking German partners will often cover Switzerland and Austria as part of their market territory.
you help them achieve the initial results they need. We have learned from experience that most partners are not motivated self-starters. Agreeing on a basic marketing plan also gives a company a tool for managing and monitoring the partner during the first critical months of the relationship. they will forget about it. he will continue to invest in it. The initial results don‟t have to be actual sales. The ideal marketing plan would show the actions to be taken during each of the first six months. There are a few standard marketing tools that the partner should be willing to use: Mailings and telemarketing Product seminars Webinars Trade shows Press releases/editorial coverage Advertising The marketing plan is not intended to be an extensive document. and then provide sample materials that can be used directly or translated and modified for each market. and sees that people are interested in the product. and by requiring a marketing plan that can be monitored. All we need in the marketing plan is a commitment to do at least one of the above every month during the first six months. Page 75 . and budget numbers for the cost of marketing and resources to be used. The problem is that some action is required on their part to bring in those results. ideally something that is based on what works in the domestic market. or it is unlikely to get done. it would be good to base some of the plan on what works in the domestic market. Mailings and telemarketing are the preferred tools because they are relatively inexpensive and effective. and then follow up to make sure they are doing what they promised. But the important thing is to get a commitment that they will do something each and every month during the first six months. and the product will not reach its potential with that particular partner. the people and resources that would be assigned to the product. and do not understand the basics of marketing. It is often a good idea to have a simple marketing outline that can be used to assist a partner in defining the steps he needs to take to properly launch the product. This has to be done prior to signing the partner agreement. As long as the partner is getting a response from prospects. Again.Develop the Marketing Plan Many partners come from a technical background. and if they do not produce results with a new product within 3-4 months.
food.. reply coupons) and other major prospects who did not respond. *Ship out and manage 3 product trials *Prepare and place an advertisement in a suitable publication *Send out mailers to the identified market sector. second 200 of non-customer list (stage 2). This will involve the following activities over this first year: Month June Action *Product familiarization (2 people for 1 week) *Identify the exact market for the product and acquire/develop mailing lists accordingly e.. * Approach 10 major Partner/SI‟s re partner arrangements and meet with at least 2. reply coupons) and other major prospects who did not respond also follow up any stage 1 leads.. mailers (i.500+ Nov $5000+ $2000+ Page 76 .Sample Marketing Plan Marketing Plan for ABC Software Prepared by Channel Partner The Marketing Campaign Since there is little or no name recognition of ABC SOFTWARE in California an extensive marketing campaign is required. banking. (late in month) *Follow up leads generated by stage 1 mailers (i.e. *Prepare and send out mailer to prospects *Follow up mailer to prospects (calls +additional information sent) *Customer visits/presentations/demonstrations (assume 10 in the month) *Prepare and send out mailers to the identified market sector.e. pharmaceutical..g. Cost $2000+ $1500+ $600+ $1200+ $2000+ $800+ July Aug $1500+ $3000+ $2000+ $800+ $4000+ $2000+ $1000+ $500+ Sep Oct $800+ $5000+ $1500+ $2800+ $1. third 200 of non-customer list (stage 3) *Customer visits/presentations/demonstrations (assume 25 in the month) *Ship out and manage 5 product trials *Follow up leads generated by stage 3 mailer (i.e. *Customer visits/presentations/demonstrations (assume 15 in the month) *Attend training course in Boston *Send out mailers to the identified market sector. *Customer visits/presentations/demonstrations (assume 25 in the month) Approx. *Customer visits/presentations/demonstrations (assume 20 in the month) *Follow up leads generated by stage 2. first 200 of non-customer list (stage1). reply coupons) and other major prospects who did not respond also follow up any stage 1 and 2 leads.
000 $50.000 We think it is realistic to expect no sales for the first 3 months due to: * The natural sales cycle * Time to become familiar with the product and market The payoff from the investment should become evident after February 2006 although we may be lucky and find a large client who wants to move ahead quickly. reply coupons) and other major prospects who did not respond. To meet the plan above we have allocated the following resources over the 7-month period: Management tasks 20-30% allocation Sales 80-100% allocation Support 50-70% allocation Admin 20-40% allocation Obviously these would be ramped up if sales exceeded expectations. fourth 200 of non-customer list (stage 4) * Approach 10 major Partners/SI‟s re partner arrangements and meet with at least 2.e. In 2006 we will be in full flight.g. electricity.. also follow up any stage 1.2 and 3 leads. telephone etc). rent. Sales Targets Month June July August September October November December Estimated Total Product Revenue $0 $0 $0 $20. Page 77 .000 $70. *Customer visits/presentations/demonstrations (assume 25 in the month) *Ship out and manage 10 product trials *Sign up 2 partners to sell/promote ABC $800+ $1000+ $1000+ $2000+ $5000+ $2400+ $3000+ Resource Allocation The table on the previous page shows the cost in time and materials to implement the marketing plan. The on-costs of staff are not shown (e.Dec *Ship out and manage 8 product trials *Send out mailers to the identified market sector. The quotas for next year should be set in early December since we will have some history to base the figures upon.000 $30. * Follow up all outstanding leads *Follow up leads generated by stage 4 mailer (i.
if an ISV will be recruiting a broad base of partners.Setting Realistic Revenue Targets The purpose of having sales targets for a product is to make sure the partners are making a minimum effort to sell the product. Further. the product can be introduced to multiple markets Negative factors: The product may be unknown outside its own market. and will invest limited resources until they can see that the product is going to succeed The sales cycles tend to vary from market to market English-language products may have to be translated in order to get strong penetration in certain markets Most markets will have home grown and imported competitors that are already established Dollars or Units? Sales objectives can be established using absolute dollars. but an extension of an existing product line. The combination of a simple. so a company should consider how long it took to establish its identity when they first started the business. In some cases the product will not be a strategic product. This means that there should be a “bell curve” of results. it will not depend on one partner for its success. With the right support structure. Partners will not be as dedicated to making a product a success as the ISV is. so it is essential that the progress be monitored on a regular basis. Setting objectives in dollars makes it easy to gauge the results in the short term. Factors that should be considered in setting objectives include: Positive factors: The ISV has an established reference base that will make it easier to introduce the product internationally. or both. with Page 78 . units (number of licenses). but the risk is that the numbers are achieved through sales to one or two companies. The ISV has proven marketing programs that might be transferable to other markets. monthly marketing plan and reasonable targets should accomplish this objective.
some partners selling lots of smaller licenses. with no sales the first quarter. minimums should be measured in dollars and units Page 79 . either for a geographic region or a vertical market. If there will be a number of partners. Recommendations: Keep it simple. and some closing large enterprise sales. leveling off in year two Incorporate an annual dollar minimum for automatic renewal If a partner is given some form of exclusivity. and then an increasing number for the following three quarters. This will be part of the channel mix that is established for each market. the ISV won‟t want to build an administrative headache when it comes to reviewing the results Enforce a minimum number of license sales per quarter.
but make sure there is a specified time limit after notice has been received Partner filing for bankruptcy. if that changes. this doesn‟t necessarily prevent them from selling (but it might prevent them from paying if they are under the control of the bankruptcy court) Not meeting sales targets Disclosing confidential information Improper use of the product. but depending on the type of filing. it will be based on the relationship with the owners/key executives.Default Provisions Typical provisions that allow the ISV to terminate prior to expiration: Non-payment. Even if the agreement has been entered into with a corporate entity. such as making unauthorized copies Change in control or sale/merger of the company. you want to have the option to terminate the agreement Page 80 .
. Page 81 . It‟s his product. As an ISV you will have agreements with companies in many different countries. The partner agreement will have been drafted according to the laws of the ISV‟s country. whether you are setting up an office and hiring your own employees. and it is less expensive to have it reviewed by attorneys in other countries than having new agreements drafted in each jurisdiction 3. and then click on “Establishing a Business” which will provide the contact information for the local law firm. and to include a provision for arbitration for dispute resolution. The ISV‟s home country should always be the governing law. select the country that is of interest to you. and needs the protection of his own court system 2. link to “Select the right markets”.Governing Law This is an issue that often generates a lot of discussion.g. and is often the last point that is negotiated. Microsoft Resources Through the International ISV Assistance portal (navigation path after signing in on the partner portal is Program Membership/Competencies/ISV Software Solutions) you can find law firms in all of the major markets to provide local advice. and a very desirable partner that can generate a lot of revenues. An alternative is to use the governing law of a third country. From the International ISV Assistance portal. and it is not reasonable or practical to have to defend the contract in many different jurisdictions If the partner organization is a large one. or going through indirect partners. the UK. e. because: 1. an ISV should not let the governing law stand in the way of a profitable relationship.
Users will often find. 5. Strategies for selling larger installations. This will give the partners direct access to a wider range of resources within the company. Strategies for selling against specific competitors. 6. 2. If at all possible the sales training should be at the ISV‟s facilities. Detailed description of the sales process the company itself has experienced (see “Documenting the Sales Process”). A detailed competitive matrix will be important to have. or is it more of an enterprise sale? 3. including target market and competition. 4. and even if it has unique features it will often be classified as being in a larger “space” that includes competitive products. features and benefits the ISV did not think were important. No technology is unique. It can be useful for a partner to see how clients are using the product in a real-life environment. Page 82 . Client visits. A basic overview of how the product is used.Sales Training Some of the features of a sales training include: 1. For instance. Strategies for bundling add-on modules into each sale. 7. or focus on. Strategies for overcoming functionality objections and suggesting "workarounds" if the product "technically" doesn't offer the feature a customer wants. and also make client visits more practical. such as multi-user systems vs. single-user systems. This should include a discussion on the sales cycle. does the sale typically start with a few seats.
including complete setup of all modules and add-ons. If this can be combined with a customer visit. but much of it can be documented and either incorporated in a partner manual or made available on-line. etc. 2. 5. This would be the equivalent of a technical presentation to a prospective client. An in-depth discussion of the key technical elements of the product. including a drill-down on what makes the product technically superior to competitors. escalation of trouble tickets. because partners have a bad habit of delaying selling an existing version if they know or think that a new version will be released in the near future. Presentation of current technical support resources in the company. Answers to basic support issues and common problems with the use of the product. how are tech support issues answered. A basic understanding of common issues and problems relating to the environment in which the product is installed. 4. Actual demonstration of a hands-on configuration of the product in a mock company. Product development plans – where is the product going? This should be a general discussion. A complete overview of the software. This overview is generally intended for on-site training.Technical Training 1. 7. 6. so much the better. Page 83 . who does what. 3. including any and all modules.
Terms and conditions of purchasing.Review of different marketing materials .Overview of marketing methodology . EVENING Social Event (dinner.Review the list selection criteria . shipping etc.Review of technical support materials that are/will be available to them An early dinner since travel could make some of the participants tired LUNCH AFTERNOON EVENING DAY 2 9:00 Sales and Marketing . local attraction) Page 84 .Installation issues . returns.Review of frequently asked questions .Review successful direct mail letters/campaigns .Review product demo .Listen in on customer/prospect calls Lunch out or catered in LUNCH AFTERNOON Review of marketing support materials that are/will be available to them Operations .Review of Partner Manual .Overview of product family .Technical discussion of product components .Typical Agenda for 3-Day Partner Training DAY 1 10:00 Welcome and general company overview Overview of the product‟s market Catered in Technical training .
A visit to company site by a local user .Prepared case studies Lunch out or catered in Hands-on work with the product Closing dinner at a fun.DAY 3 9:00 Visit to customer site or as an alternative: .Conference call with a strong client . informal place that is conducive to building personal bonds LUNCH AFTERNOON EVENING Page 85 .
Ordering Information – Information on how payments can be made and a detailed description of the ordering process. fax and e-mail addresses information. Training Programs – This should include the initial (mandatory) training plus a description of any scheduled training programs that are available to partners. response times. Product Descriptions – A summary of each of the products that are being sold through the reseller channel. market focus etc. or descriptions of available marketing resources along with any associated costs etc. or on-line links to. Materials could include sample advertisements. key management. access to any data bases etc. and it will reduce the number of calls and e-mails that come in to the channel manager. a short description of their responsibilities as it relates to the resellers. Key Contact Information – for the people who will be working with the resellers provide (at a minimum) phone. on-line marketing. direct mail pieces. It will greatly reduce the likelihood of misunderstandings. While there will be some work involved in compiling and organizing the manual. Pricing Information Availability Charts – Version numbers and languages available for each product. The investment in time to prepare the manual will be more than recovered once a channel is recruited. brochures. most of the elements will already be available in different parts of the organization. Technical Support – Description of your technical support process including: methods of contact.Partner Manual In order to establish the basic parameters for how partners will be managed. telemarketing scripts. The most common elements of a partner manual Company Profile – a short history of your company. including order forms or screen shots of on-line systems and any other documentation that you might require. types of clients. how trouble tickets are processed. data sheets. especially if there area a lot of modules or individual products. Many companies have regularly scheduled classes for clients…and these should be made available free to resellers. website pages etc. Page 86 . values) your product(s). including important technical information and key selling points. Marketing Materials – Copies of. (mission. the ISV should develop a partner manual that contains all of the information relevant to the relationship.
the reseller principal wants to be in control of incentive programs and may or may not want the organization as a whole being aware of program details. because it makes managing a large number of partners much easier. Many times. how those funds can be applied and the process for claiming and receiving used funds. These questions should be answered. Marketing Support Programs – Any terms and conditions surrounding any market develop funds that are earned from sales. Reporting requirements and reporting formats Note: This is an essential document. 90% of the questions that come up in a channel relationship can be answered in the partner manual. thereby minimizing the need for human interaction. because it is the path of least resistance.” It is important that they get into the habit of being self-sufficient. Shipping Policies and/or process for obtaining products. Even after they have been furnished with a partner manual they will call or e-mail. If it is only sent by e-mail. The manual should be made available as a written document as well as in an electronic format. Page 87 . but with each answer there should be a comment made that “this information can be found in the partner manual on page __. many partners won‟t bother to print it out. Frequently Asked Questions – This can be in two different forms: Potential reseller questions to help cover any issues not addresses elsewhere in the manual and/or the typical questions that you receive from your customers that are not addressed elsewhere in the manual Incentive Programs – This may depend on what type of programs (if any) that you would consider having. Maintenance Policies Upgrade Policies – What levels of upgrades are included as part of the maintenance fee. what constitutes a chargeable upgrade etc.
or if the product is complex and expensive. These visits are an opportunity to give more of the partner's employees exposure to the product. Spending the time and money to visit partners at their place of business at least twice a year (more often if they are in a major market. where the ISV can have a big impact on presentations to key accounts) pays big dividends. Page 88 . provide more sales and/or technical training. meet with key accounts. often on faith.Site Visits There is no substitute for personal visits. the return on investment should be exceptional. When the cost of a trip is measured against the additional sales that can be generated. ISVs are asking their partners to make a substantial investment on their behalf. and solidify the personal relationship with important business partners.
Not everyone will attend. Page 89 . there is no need to schedule three or more days. new product introductions. with the exception of sub-partners. an annual conference is the best way to share ideas and build a sense of community. and it‟s no fun with five or six people showing up. it sometimes makes sense to have separate conferences for certain geographic regions. technical training. or small partners in secondary markets. and you want them to spend more time thinking about your products. but unless you have a compelling reason to expand the conference. This will give you enough time to cover the key points. Later conferences might grow in duration as the partner population grows. Why should you have one? Build rapport with and among the partners Present and discuss product development plans and new marketing programs Gives partners an opportunity to blow off steam if there are issues that bother them Give partners a chance to exchange war stories. and the conferences take on more of a social aspect. When the channel starts to become quite substantial. All of the primary business partners should be required to attend. the number of products increases. Keep in mind that channel partners are selling a number of products. but these should be in addition to the annual conference where all of the business partners get together. How long should it be? The first conference should be 1 ½ to 2 days. Should it be mandatory? Yes. or for sales and marketing.Partner Conferences Once a company has established a reasonably well-developed network of channel partners. and see what works and what doesn‟t in different markets When should you organize the first one? Once there are 10-15 active partners. just for the sake of having a longer program. How often should they be held? At least annually.
so that partners don‟t have to take several flights to get there. and relatively easy to reach. Who pays for what? That depends on whether you see the conference as a work session. It can also be an idea to hold it close to the ISV's site every once in a while. What does not work very well is expecting the participants to be on their own for dinner and drinks. or as a marketing tool. or where any partner that achieves a certain sales level is granted an additional discount until their conference costs have been recouped. and to give more of the company employees exposure to the international activity. It is usually a good idea to hold the conference in a location that will be appealing. because they invariably end up following the host wherever he is going.Where should it be? It depends on what is most convenient to the majority of active partners. Conferences can also be used as a sales incentive. so that channel partners can have a chance to see the ISV's facilities. This last method has the added advantage of giving the partner a reason to keep his sales going at a strong level. Some companies charge a conference fee to cover the cost of meals and drinks. In either case the participants normally pay for their air fare and hotel. and it is both awkward and rude to ask for separate checks. where the top three or five partners get all or part of their expenses covered. It can have a positive impact on the whole company when people get the feeling that this is an organization that is going places. Page 90 .
Are they hard to organize? Organization is the key word. If there are 20 partners. a block of rooms has to be booked. because there are a lot of details that have to be taken care of. How many company employees should attend? It is better to have too many than too few. so their input is important. and build personal relationships that can help grow sales. to take an interest in their business and their families. there should be five or six employees. and to give the company enough time to "sell" the partners on the importance of attending. a location and hotel have to be selected. The exact location and a preliminary agenda should be ready and mailed out to the partners 4-6 months before the conference. Make sure that employees are instructed to spend time with the partners. Page 91 . and to find out what can be done to improve the business. Spend some time before the conference to prepare the company attendees properly. and some thought has to be given to the contents. In order to be ready 4-6 months ahead of time. including the key senior managers. This is an opportunity for you to "press the flesh" with your partners. Partners are the key to success. to give them enough time to schedule the trip.
What is the process for review? .End user? .Who is responsible for review? Are compensation plans consistent with goals? Support Is there a channel support plan? Resources Responsibility Is there a support agreement for: .Checklist – International Channel Program In progress Section Question Done Organization Who is responsible for defining International Sales & Marketing Strategy? Who is responsible for managing and implementing this strategy? Are objectives clearly defined in writing? Does a project plan exist? What are key milestones? How do you measure whether they have been reached? What are the financial goals? For what timeframe? What is the budget to reach those goals? How is progress against financial goals and budget measured? .Partners? OEMs? Is there a training plan for partners? Is there a 24 hr.Is there communication with Sales on lead times for delivery? Page 92 Required .How frequently are they reviewed? . support plan? Implementation Do license activation codes get generated in the channel or by the client? Is the process 24hr or will channel be subjected to time delay on fulfillment? Are order fulfillment plans in place? .
In progress Section Question Done Sales/ Channel Development Is there a written sales plan? Does it cover: lead generation and partner referral programs prospect database. responsibilities. how? End user demand generation: pull programs User groups Conferences.presentations . channel access qualification criteria qualification & sales process Are there sales forecasts by region & channel? Are channel quotas in place? Are resource requirements documented: . Seminars Programs Marketing Is there a written statement covering Product Pricing Packaging Positioning Is there a profile of the target end-users and target partners? Page 93 Required .sales toolkits Are there partner plans in place? Description of opportunity Partner manual Training plan Is there a plan for hiring.collateral . when. compensation & management of staff? Account/reseller management process: pipeline tracking management to quota marketing program results push programs visits & communication: who.
License agreement . OEM: .Support agreement Reseller Agreement What is termination process? (reviewed by legal) Are termination consequences understood by sales? Retail price maintenance/differential pricing controls ? Revenue recognition policy internally for channel sales? Sales order process in place? How to control all revenue is captured/invoiced? license keys (lockouts legal?) Maintenance Is there a credit control process in place? .How is risk managed? Development Schedule agreed for updates & revisions? Escalated support process? Responsibilities defined Resources planned Page 94 Required . partner.In progress Section Question Done Agreements Letter of Intent For: End-user.
PARTNER RECRUITMENT Page 95 .SECTION II .
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will there be additional servers required? With document management systems. but it also makes it clear Page 97 . and the number of billable days for each. and what is the likely margin for the partner? Hardware – will the partner be selling significant amounts of hardware. Of course. so it is important to identify how your product can drive margin opportunities for your partner. While the size of transactions will vary greatly for most products. For this reason. etc. building the partner profile actually consists of two steps. “We have a terrific product that sells itself and installs out of the box”. Identify the types of services. including: The discount on your product.Define the Partner Profile Most ISVs that start to build an indirect channel start by trying to sell prospective partners on the technology. There will usually be many elements involved in a sale and the installation of the product. high-speed scanners are often required. you should identify the “typical” transaction size and what this will produce in discounts for your partner. such as a database? How much does this add to the sale. Depending on the market and the related “pull-through revenues from your software. their main concern is how they are going to make money. Building the Business Model The discount on the software license is rarely the only source of revenues for a channel partner. the product has to perform as promised. there needs to be an ROI (Return on Investment) that they can calculate. such as: o o o Proof of Concept – are revenues generated prior to closing the sale? Installation and integration – how much billable work is involved during the installation and roll-out of the product? Training – will the partner be providing chargeable training to the users? Additional users – is the product typically sold with a small. building the business model from a partner perspective. initial installation. Services. “Our product is the only …”. with an increase in the number of users during the first 12 months? What is the lifetime value of a client versus the initial sale? Third-party software – will the channel partner normally be selling other products as part of the transaction. Building out the business model not only makes it easier to demonstrate to a potential partner the overall revenue opportunity created by your product. and from that defining the partner profile. Margin contributions can come from many sources. and what is the margin? For example. expensive. but when channel partners are expected to invest in sales and marketing for a new product. the discounts will normally range from 35-50% of the list price. The truth is that prospective resellers are not focusing on the technology. 1.
because they can build a business base through their marketing. whether the technology is horizontal. and where the reseller‟s technical strength is an important part of the selling process. the type of sales cycle that they should be comfortable with. The reseller‟s installed base becomes an important factor. ii) Vertical or horizontal market? If it is a vertical market.what skills and complementary technologies make them an attractive partner. Without an existing customer base it would be difficult to identify prospective end users and then Page 98 . At the other end of the scale are products which are extremely technical. Defining the Partner Profile The next step is to decide and define the qualities a good prospective reseller should possess.) The type of technologies they currently sell Technical skills they should have for pre-sales. because the initial sales will be based on personal relationships that are already in place. so that they have clients that they can go to with the new solution. etc. etc. Some of the factors that influence the profile of the prospective partner as well as the number of partners an ISV will need are: i) Product sale or service sale? Products often fall into one of two broad categories. With this type of product you would be looking for good marketing organizations with strong direct mail and telemarketing skills. we can develop a profile of the "ideal" reseller. complementary products they should be selling. The first is a pure product sale. Their installed base is less important. is it likely that a high percentage of targeted resellers will respond?). SME. By going through this exercise you will know what level of services they should be capable of providing. An end user is not going to buy the product from an organization in which they do not have a lot of confidence. The actual number of initial targets in a market will vary depending on the size of the market. where there is little or no consulting or services required to install and run the product. 2. the perceived appeal of the product (in other words. Some of the elements that can be included are: Target market and clients they sell to (large accounts. it is almost a requirement that prospective resellers currently represent a complementary technology. etc. installation and tech support Length of time in the market Vertical market specialization Geographic location Minimum annual revenues Based on the technology and its positioning.
all of which generate relatively small sales. If the product is quite technical. then it is unlikely they will devote a lot of attention to a new product. Current product portfolio. iii) Cost of the product. Expensive products are more difficult to sell via mail or phone. If it is more of a pure product sale.market to them with any real credibility. while others have a focused product strategy and put a lot of resources into each new opportunity. you will want to make sure the reseller is located close to major business concentrations. but the real selling will have to be done face-to-face. so that they have a big “bag of tricks”. The product cost will have a direct bearing on how the product is marketed. because the sale will require on-site visits for the initial demo. iv) v) Page 99 . telemarketing and other low cost marketing tools. and perhaps the installation and evaluation. A product with a low entry-level price cannot be marketed through a direct sales force. Companies may use these methods to generate interest. so the prospective reseller should have a good sales staff and a proven ability to deal directly with end users. then geographic location is less important. so the best resellers will be using direct mail. Some resellers maintain a large portfolio of products. How many other products is the reseller currently handling? How important is the new product to him strategically? If a small company has 50 or 100 products. Geographic location.
If the reseller is struggling financially. The key is to work with a business unit. A business unit with a maximum of 30 employees seems to be a good rule of thumb for most products If the product is technically complex. say 9-12 months. they will not be able to invest sufficient resources to make the product a success Small organizations can be winners if the product is relatively straightforward and can be marketed “anonymously” via direct mail. and the reseller‟s relationship with its installed base becomes a key part of the buying decision If the product is multi-platform. in many cases. In order to justify this level of investment they typically want to take on products that have a minimum of $10-20M in revenues in the ISV‟s domestic market. the learning curve for a new person could make it impossible for the company to continue marketing the product effectively If the product is expensive and difficult to install and maintain. that is small enough to see the product as an interesting opportunity. because it will be the commitment of the individual(s) responsible for marketing and supporting the product that will be the key factor. They tend to look for major product opportunities that can justify establishing a separate business unit. to ensure that the product and the company have staying power Large companies can be good partners if they operate smaller divisions. etc. whether it is a division of a large company or an independent company. telemarketing.large corporate customers will only deal with companies that they are confident will be there to support them. and to give it good visibility and support. There are many examples of one and two man operations being successful with a product when it is their primary source of revenues Page 100 . the company must be large enough to have other sources of revenues to cover the costs of launching the new product. the tech support staff must be large enough to provide support across the board If the sales cycle is long. the longevity and reputation of the reseller will be an important part of the selling process . not spend a lot of resources on a “small” product. even if one or two people leave. within which a given product could be an important part of the mix. Some things to consider are: Very large companies will. the reseller must have a large enough staff to support it properly.Is there an “ideal” size for a reseller organization? The success of a product is not necessarily tied to the size of an organization.
instead of focusing on the key criteria that you feel are necessary for them to succeed over the long term. When speaking with a company on the phone it is easy to be carried away by their enthusiasm. it becomes quite clear which company or companies it is worthwhile pursuing. By expanding the scorecard above into an Excel spreadsheet. with all of the prospects listed side by side. Page 101 . 5 being best) The primary purpose of the scorecard is to make sure that you are comparing the prospective partners objectively.Build a Scorecard When the parameters have been established it is easy to build a scorecard that lets you rank the prospects: Prospect Name: Region Criteria Complementary products Number of employees Geographic location Revenues Technical skills Length of time in business Vertical markets Number of products sold Total Points Rating (1-5.
g. Search engines can help in identifying prospects. network management systems.tlclists.. Internet sites and consultants that specialize in matching ISVs and partners. help desks. The first would be to post a description of the product and the company‟s interest in recruiting partners . Since partners often specialize according to platforms.Develop a Database of Prospective Partners When the profile has been completed. is www.infousa.ca/) The List Company (http://www. etc. and they can be a resource in a couple of different ways. distributors and VARs. Newsgroups on the Internet There are Usenet newsgroups for most technologies. banking & finance.com/). enterprise management systems. you will be able to start the process of compiling a list of prospective partners that should be contacted.customerleads.compubase. There are a number of companies that maintain a database of ISVs and products. you can get links to companies and organizations that can lead you to more options. network management.google. older messages can be researched using Déja News (http://groups. By entering different key words.capterra. For a fee they will either list the product opportunity. good prospects can be found by looking for vendors of other products that are sold into the same customer groups. etc.g.com. government) or technology (database management. Some examples are: Dun & Bradstreet (http://www.net) Pro Biz (http://www. Mailing lists There are companies that maintain databases of partners.dunandbradstreet. If a particularly good newsgroup is found.. The second is to try and identify partners from the messages that have been posted.com) Page 102 ..). Sources of potential partners Web sites of companies with complementary technologies Most software companies have Web sites that provide a list of their distributors and partners. or actively try and match products and partners.com/) Info-USA (http://list. AS/400. ERP. Others specialize in localizing a product and helping to bring it to market. e.com/us/) ZapData (http://www. A good source of software companies. market segments (e.com) CompuBase (http://www.zapdata. charge a commission on actual sales. searchable by applications and functionality. manufacturing. both domestically and internationally.
There are also a number of specialty publications focused on partners and VARs. Trade shows International partners visit a surprising number of trade shows. In most countries they have a list of companies that are looking for products to sell. and their job is to help companies from their home country expand their business overseas. especially corporations. They will also very likely have lists of partners and distributors looking for products to sell. e. and perhaps introductions to key distributors.Hardware Vendors Hardware vendors need successful software products in order to sell their products. especially when the person responsible for organizing it has some experience. or to convince customers to upgrade. While there is some expense involved these trips can be successful. If you have a stand. Commercial attachés Embassies generally have a commercial attaché whose job it is to help companies increase their exports. a mention that you are accepting international partner applications.g. make sure you have special signage stating that you are looking for international partners. always include your Web site. so their interest in your product may not be sincere. make sure you carefully screen companies that respond to your mailshot. Government trade missions In many countries government offices at the regional and federal level organize international trade missions. Partners are notorious for signing up products just to expand their portfolio. Advertising in trade publications If you are advertising your product in publications that have international readership. and runs on their platform(s).. either through trade shows or your Web site. Word of caution: Be extra careful in qualifying companies that contact you. if the software product is sold to a complementary user base. These trips are usually focused. Page 103 . and this can be a useful starting point. Chambers of commerce Many countries have a chamber of commerce that maintains foreign offices. Again. and as part of the program they arrange seminars and appointments with interested companies. software companies only. because many of them are looking for new technologies that have not yet reached their local market. and if room allows. and may not have any intention of establishing a wider marketing effort. Partners are often looking for a solution for one client. They are often willing to provide market information.
Midsize Business Center.com/mprd/) Post specific opportunities. complete field work. SQL Server.com/global/40018508). Windows Marketplace).microsoft.com/global/40010230) is an exclusive networking and resource-sharing community for Microsoft Partner Program members that can help you expand your business opportunities. Resources for Partner and ISV Searches Microsoft Microsoft‟s Channel Builder site (https://partner. or if you are looking for partners in specific markets. for example if you have a client that wants your solution implemented in a market where you are not physically present.aspx Another excellent resource is the World Partner Conference (https://partner. or competencies. but this can often be a good way to research a market at little cost.partners. you can post your opportunity on https://channelbuilder.com/global/40020720 Search for prospective partners in other markets using the Microsoft Partner Directory (http://directory.microsoft. Solution Finder website. geographies. you can create partnerships with complementary solution providers across industries. an essential first step because this profile links to a number of databases that are accessible to potential partners through other Microsoft sites and portals (Dynamics. which is the best forum to meet prospective partners from around the world.microsoft. Through this site you can: Register your company as a Solution Provider. In some cases there may be a nominal charge to cover expenses. or find assignments with companies to get practical experience.com/CB/Default.extranet.Colleges and universities A number of business schools have international programs that require students to research overseas markets.microsoft. The Solution Profiler can be accessed on https://partner.microsoft. Whether online or through structured events in selected cities. Page 104 .
jsp Compuware: http://www.com/corporate/alliances/directory/default.com/Reseller/Default.portal BMC: http://www.sap.via.sun.com/partners/directories/SearchPartner.ht ml CA: http://www3.com/WWChannels/LOCATR/jsp/partner_locator.net/locator/us_partner/index.aspx Cisco: http://tools.compuware.Links to other ISVs BEA: http://partners.3316.com/partnersalliances/partners/index.infonow.nsf/weblook/index.com/BMC/Partners/CDA/hou_Partner_Find/0.com/search.com/webapps/opus/initadvancedsearch.jsp Sun: http://solutions.com/iforce/pd/advance.bmc.emc.com/partnerworld/pwhome.do SAP: www.asp EMC: http://www.epx SAS Institute: http://www.ibm.jsp HP: http://hp.ca.bea.oracle.jsp?reset_search=t Page 105 .com/apps/partners/index.5377102_5379132.html (requires free registration for access to the site) Oracle: http://www.jsp IBM: http://www-1.00.sas.cisco.
and joint sales calls to major accounts. The product is currently available in English.abcsoftware. all the options are integral to the package Easy to install and implement. ISVs with internal help desks. ABC ITSM has a number of strong points: Entirely based on the Microsoft .com) to discuss how a mutually productive relationship can be established. The product: ABC ITSM offers a robust set of service management tools that support the main IT processes described in the Information Technology Infrastructure Library (ITIL) (incident management. configuration management and service level management). Dutch. please read on. We are currently seeking a limited number of qualified business partners to represent this software product.NET platform 100% web-based Fully customizable ABC ITSM has no modules. ABC is offering a high level of support to its business partners. change management. including training Technical issues seldom arise. The ISV: ABC Software is a well-established software company with more than 180 installations around the world. Are you interested? More detailed information can be found at www. with an average of 5-10 days.smith@abcsoftware. problem management. French and German and can be easily translated into other languages. Systems integrators.Sample Outreach Letter 1 ABC Software is an ITIL-certified solution for the key processes of IT Service Management that is fully integrated with . If your company is interested in taking on a new product with proven success in other markets. including good margins. Page 106 . training.com. Mid-sized to large companies with 10 or more people in the IT department 2. The market: There are three primary markets for ABC: 1. Please contact John Smith (john. for internal and external use 3.Net. SQLServer and Sharepoint.
with support coming from their subsidiary in London. to dispatching. The average sale is $150. An R&D module completes the solution. technical leadership and product excellence. Elida Faberge. Novartis. Merck. SanofiSynthelabo.com. England. please read on. BPCS. Page 107 .000. It has been widely deployed in pharmaceutical companies ensuring compliance with the highest level of quality and functional requirements. Shiseido and Yves Rocher The opportunity: Exclusive rights for a specified period of time with the assurance that they have no plans to sell directly into the US market. More information can be found at: www. weighing. optimizing packaging.Sample Outreach Letter 2 We are currently seeking a primary business partner to represent a software product in the American market. PRISM. The product: A market leading MES product. including Aventis. Glaxowellcome. XFP. from warehousing. including FDA and GMP. Schering. which covers all aspects of manufacturing security and traceability for regulated industries. They also offer a complete and comprehensive package of initial marketing. controlling and standardizing manufacturing. Pfizer-Parke Davis. Reference accounts: 14 of the top 20 pharmaceutical companies worldwide. Smithkline. Strong sales and marketing capabilities coupled with excellent integration and technical skills are essential. JD-EDWARDS and MAPICS. such as SAP R/3. generating an equal amount in service revenues. If your company is interested in taking on a new product with proven success in other markets. Givenchy. Johnson & Johnson. It is fully integratable with ERP systems. sales and technical support in English. XFP is a complete solution comprising complementary modules which correspond to the various process stages.abcsoftware. ABC Software‟s US partner should share their strong commitment to customer satisfaction. Qualifications required: We are looking for a company that is successfully providing solutions to pharmaceutical companies or related regulated industries. XFP runs on an industry standard client/server platform in either stand-alone mode or connected to host systems.
get a specific name. or to "President" rarely get opened and read. The prospect has to be given a good reason to respond. Inquiries that are simply sent to a company address. take the time to call the switchboard and get the name of the appropriate person. If the source that was used to find the partners didn't list names. But be prepared to present the product if you call. even if you are only calling to get the name. To the extent it is possible. The first contact with a prospective partner is critical. because the person answering the phone will often pass the call along to the Managing Director. it is important to get a good product summary out to the prospects.Get a Contact Name After compiling the initial contact list. because it will determine your likely success. Page 108 . Most partner organizations are small. so it will be the owner or Managing Director that makes the decision on new products.
Once you are connected to them. or “not now. and their contacts‟ network. but 17% of the people we contacted agreed to a meeting or an introductory phone call. Some of the responses were “thanks. The process works as follows: 1. or to one of their contacts who then passes it along to the target 6. Identify a company or individual that you want to access 2. and it works because your inquiry reaches the target through someone they know. The principle behind LinkedIn is to work through trusted contacts – you invite business contacts that you know and trust to become part of your network. and we had a 36% response rate. We ran a campaign where we reached out to C-level executives at 151 companies through LinkedIn. explaining why you are contacting them 5. When the system works. For more information on how to make the most of LinkedIn. In essence you are getting a “warm” introduction. and as of mid-year 2008 they had 22 million members worldwide. check out http://www.com/smart-ways-to-use-linkedin/. so you will know when it has reach the target). Both messages are sent by LinkedIn to your contact. You compose a message to the person you want to reach. you have access to their network of contacts. LinkedIn will show whether they are members of LinkedIn. your message will reach the contact (you can track the progress on LinkedIn to see where in the chain your message is.com) has become a very effective way to reach individuals that do not respond to e-mails or voice mails. meaning that you have to go through two levels of contacts to reach them) 4. It is a social networking tool that focuses on business professionals. It is surprising how effective it is.linkedintelligence. You compose a second message to the person in your contact network that needs to pass the message on. either directly if they are linked to the target.Using LinkedIn LinkedIn (www. Page 109 . call us back in 6 months”. and if you can reach them through your contact network – it will also show whether you have to go through one or two links to reach that person (the target person is usually the third link. who can then decide whether or not they want to pass it along 7. but no thanks”. Search for the name in LinkedIn 3.linkedin.
This is achieved through sophisticated software integration systems.Initial Prospect Contact and Qualification Script INTRO Hello XXXXXXX. what I want to accomplish now is to discuss this a bit more. BENEFIT The benefit to the end user (your client) is that their investment in existing mainframe applications can co-exist with modern applications without the need to re-write programs or replace systems. CC and DD.now I would like to ask you “is this an area that interests you or your company?” IF YES OK. as well as ask a few questions. The plan is to select a limited number of UK-based resellers who have the capability to sell and support the software there. (and other international markets if that is the case). I am calling today to see if there is any interest from your company and to provide an introduction to the solution.…………Can I take a few moments of your time now? IF YES Can I first ask whether you would be interested in looking at the benefits of becoming an early reseller for ABC Software? Page 110 .S. CREDIBILITY Our company is ABC Software. my name is John Smith from ABC Software. and find out whether we both want to pursue this further. We are positive that this proven solution will be attractive to similar organizations in the UK.. ERP and any web-based application. I‟ve briefly explained what we are about…. and we are now introducing our solution into the UK. ………. BB. GAP The software bridges the gap between back-end mainframe systems and modern front-end applications.. such as CRM. and our client list includes large organizations such as AA.How are you? That‟s good……………We are an American software company that has been very successful in the U. HOOK So.
asking questions about: o o o o o other ISVs they represent the type of clients they have the vertical markets they are strongest in what they do to market their other products would they be willing to allocate a marketing budget for this product IF NO Establish why o No budget? o Not a good fit? o Too much competition? Ask for suggestions of other resellers that might be a good fit Page 111 . LEAD ON Depends on conversation.Or. who handles the appointment and management of reselling complementary software solutions. but: This could be a broad description covering the major highlights of the ABC Software system Or it could be answering questions Or qualifying the prospect.
because with so many viruses circulating. Faxes work best when they are addressed to a specific individual. Should not be used if you are only sending a text letter. many people simply delete e-mails with attachments coming from an unknown source. 3. There are three ways of sending the initial information out to prospective partners: 1.Send Out One-Pager Remember that an ISV is going through a two-phase selling job when he is setting up an indirect channel. This is best if there is a printed glossy or flier that does a good job of describing the product. it is difficult to get anyone's attention. E-mail is cheap and easy. E-mails have to be sent to an individual. but he also has to show that the end user will be getting a product he can use. Letter sent as snail mail. And since e-mail has taken over the communications process. 2. you should have approval to send it. The first e-mail that is sent out should not contain an attachment. and when you have approval to send the fax (unsolicited faxes are illegal in many countries). Faxing. Page 112 . Faxing is convenient and cost-effective. E-mail. but with all of the spamming that is going on. and the subject line needs to get their attention. He has to convince the partner that he should represent the product. and a good level of support once the product has been purchased. people get fewer faxes.
Getting Past Voice Mail Doing business in the age of voice mail can be extremely frustrating. Is he the senior executive responsible for selecting new products?") Get an e-mail address ("I have been unable to reach Mr. leave a voice mail commercial which is no more than 30 seconds or the "delete" button will be used. While it is true that some people leave their voice mail on all the time. and wanted to try again while you were in your office. Are you expanding your product portfolio?") Leave a message by proxy for Mr.S. for example by calling before 8:30 or after 5:30. you should do both. "I have called several times but haven't heard back from you. you can sometimes get through by calling off hours. but treated properly they can be a good ally as well as a source of information. and the percentage is likely to be higher for senior management. especially the East and West coasts of the U. DOs and DON'Ts of using Voice Mail DO use voice mail as an advertising medium. In either case you can benefit from having a live person on the phone to: Confirm that you are targeting the right person ("Hi. and that I will send him an e-mail to follow up?") If you have made a favorable impression on the gatekeeper. Bigg by phone. but there are markets where the percentage is higher. this actually is an operator/receptionist." let them know you are eager to speak with them. Estimates are that 70% of calls go straight into a voice mail system. there is a possibility he or she will put in a good word for you. or just a warm body in the marketing department. and I am trying to reach Mr. never make them wrong for not returning your calls. Assume that most people won't call you back. but rarely. As a rule. DON'T try to make them feel guilty. Most voice mail systems give you the option of dialing "0" if you want to speak with an operator. You may also find people at their desks during the lunch hour. Bigg know that I called. Bigg ("Would you mind letting Mr. Rather than saying. but it is more likely to be an Executive Assistant. Bigg. Make good use of the screener or gate keeper These are the people who are supposed to keep you from speaking with your intended contact. try Page 113 . so could you please provide me with his e-mail address?") Get useful information ("I see from your website that you represent products from ABC Software. In other words. so just keep trying until you get through. So should you keep calling or leave a message? Actually.. Sometimes. Whether you reach your prospects or not. this is John Doe.
try finding it on the company's web site or asking the receptionist. Microsoft Resources Microsoft offers an ISV Telesales Service that: 1. DO send an e-mail if you have called. 3. Page 114 . they may be willing to set up a phone appointment with you to find out more. If you can interest them in what you have to offer. tested. Helps empower your sales team to close more deals. and trained on the Microsoft Solution-Selling Process (MSSP) and business decision maker (BDM) selling. When you don't have the person's e-mail address.not to leave any more than three voice mail messages over a 10-day period of time and then lay off for a month. hand-picked. Offers access to experienced telesales professionals. left messages. More information can be found on the partner page: Program Membership/Competencies/ISV Software Solutions. Finds highly qualified sales opportunities through identifying prospects' budgets and specific needs. 2. faster. Many people will quickly respond to e-mail because it is easy. 4. and still can't get through to the person you want. Helps speed your sales cycle by identifying organizations' key decisionmakers.
This package could include (possible e-mail of . Send initial information package – The partners who respond on their own or show interest through the prompting of follow-up calls should be sent an initial. providing more detailed information and interacting with other departments within your company to get answers to questions that come up. It is important to emphasize the point made earlier regarding good communications. they have "misplaced" the information they received. all of which should be followed up by e-mail and telephone for further qualification. they don't return phone calls. Partners are used to being treated as orphans by many of their ISVs. brief marketing package.pdf file or Word files): Company background information Data Sheets Brief description of the target market Pricing (partner buy prices) Send second information package . they might still sign an agreement to represent the product. Your responsiveness during this phase will give the prospective partner an indication of what support he can expect after he has signed up. This process will often require a fair amount of correspondence before the suspects are qualified and you have narrowed the list down to a few real prospects. The mail/fax/e-mail will usually generate a number of responses. This can be time-consuming because people are often not in. etc. and their efforts will reciprocate the support they feel they will get. but they probably won‟t give it their full attention. This package of information could include: Full set of company marketing materials Product demo Partner application Page 115 . depending on the technology and the market. a full package of information should be sent. During this phase your marketing person will be responding to questions. At this point there should be a number of good prospects that you can move to the next stage in the process.Based on a favorable response from this additional information.Follow-up The first step in following up is generally through a phone call. If the ISV doesn‟t really care about them.
Agreeing to deadlines and timelines is good business practice. ask them if you can call back in a week to discuss it. and how seriously they are evaluating the opportunity. and set a date for follow-up. make sure that there is a deadline by which a formal agreement is supposed to be signed. If you are issuing a Letter of Intent. try and establish a deadline for a response. is also a good indication of how professional a company is. Page 116 . If they promise to install and test a product. as the case may be.Deadline for Response Wherever possible in this process. If someone has promised to review the information you send. or not. Keeping to deadlines. and it makes it easier to keep the process on track. find out how much time they think they will need.
which often avoids sharing information about a candidate for fear of being sued. Unlike the HR department. Some of the questions you should ask include: How long have they been a partner? Are they exclusive or non-exclusive? What percentage of sales are for new licenses versus maintenance or upgrades? What level of technical support are they expected to provide.Check Vendor References Checking with other vendors is one of the best ways to determine how good the prospective channel partner is going to be. international channel managers tend to be quite open about the partners they have. and do they meet the requirements? Have their sales been increasing or decreasing over the past 2-3 years? Do they have credit terms? Do they pay their invoices in accordance with the terms? Is their salesforce stable. or do they experience a lot of turnover? Page 117 .
Page 118 . questions should include: How long have they been providing you with products and services? How many different products or services do they provide? Are they on a list of qualified or approved ISVs? What level of technical support do they provide? Telephone? On-site? Have there been any problems with their installations? Note: This will be more applicable with partners that are designated as large account specialists.Call Client References This is easier said than done. Most prospective partners will not share client information with a new ISV because they are concerned that the ISV will try to sell direct to his clients in the event they do not sign the partner agreement. If you are able to get some references. where the quality of the relationship with their clients can be important.
India Indonesia and the Philippines.they are more likely to be annual. Page 119 . Since most channel organizations tend to be small. and of dubious quality. they could be bankrupt while their financial statements reflect profits from a year or two earlier. but it is not something that needs to be emphasized. but it is often unreliable. One of the easiest and best indicators of a company‟s financial health is the ratio of sales per employee. Conclusion: Financial information could be an element in evaluating companies that are positioned to be preferred partners for specific markets or verticals. In most markets a software reseller (with no internally developed products). since at 40-60% of their revenues are being paid back to their ISVs. should have minimum revenues of $250K per employee. and preferably more.S. their financial situation can change dramatically in a short period of time. The figure would be lower in low cost markets such as Turkey. Outside the U.Financial and Credit Information This information can be useful. Ordering a report from Dun & Bradstreet would be sufficient. with 1020 employees. If they have just lost one of their strategic products representing 30-50% of their revenues. it is rare for banks to require quarterly financial statements .
the partner will have submitted his application form. Page 120 . which is a good indication of how serious they are. etc. This would allow an in-depth presentation of the technology.Completion of the Product Evaluation. Web-EX. This would involve the prospect installing and evaluating a demo version of the product. which is an important step in developing a relationship. At this point there will have been several exchanges of correspondence. The company will now want to confirm the partner‟s level of interest in the product. whereby an ISV calls the prospective partner and dials in using a program such as LiveMeeting. as well as the market opportunities. providing additional technical information that might be required. Ideally there would be a mechanism to provide a remote demo. as well as determine if they are competent to market and support the product. The product evaluation represents another investment in time by the prospective partner. etc. processing the questions that are generated during the evaluation. PC Anywhere. It is also an opportunity for the ISV to get on the phone with the prospect‟s technical people and marketing people. It is important to determine whether the organization has a good understanding of the technology. and references will have been checked.
Lead generation ii. The company (history. Development history iii. The market / clients. b.Conference Call Agenda 1. etc. Presentation of Partner Prospect a. Introduction by the person originating the call. Sales cycle – duration. The role of Partner Prospect c.). Success stories.) b. Presentation of ABC Software a.) c. Product overview ii. setting the objectives 2. Typical transaction structure 4. etc. integration. Products already sold d.) iv. Installation requirements (customization. customer base. The company (history. etc. size. The role of ABC Software b. When and why deals are lost iv. technical support. The main activities (product sales. Marketing 6. size. How the products are sold i. d. professional services. Next Steps (should be to schedule a meeting at the prospect‟s facilities) Page 121 . The Relationship a. After-sales technical support c. key decision-makers iii. 3. How the products are sold e. customer base. ABC Software‟s International Ambitions 5. The products i. etc.
product discussions. market-related issues as well as a discussion of the overall business terms if both parties decide to move forward.Reseller Meeting . Page 122 . in some cases over long distances. in order to ensure that there is a solid basis for discussion. visits with prospects should not be scheduled before they have gone through the full qualification process. Meetings should be scheduled for at least half a day. including at least one telephone conversation with a technical and a marketing person. it is best to schedule the trip when it is possible to aggregate all or most of the best prospects during a single trip. However. since they will usually include company presentations.When to Schedule Since these trips will normally involve travel. a full day if possible. The discussions should be far enough along that both you and the prospect have decided that you want to do business together if the chemistry is good and the business terms are acceptable.
including the marketing plan that the prospective partner is willing to implement Page 123 . then action items and timelines should be documented Outcome. Both companies will have some familiarity with each other from the exchange of information that has taken place. Some of the things that should be accomplished are: Company presentations. If this has not been discussed previously. tech support. Chemistry. and what the key business issues are.Prospect Meeting Objectives On-site visits to resellers can be expensive and time-consuming. but a face-to-face meeting will be an opportunity for the company executives to present their companies and their plans for the future Qualification. the ISV should provide an overview of how they see the relationship working. Do the main people involved like each other? Is it likely that they will get along as partners? Main business points. but if the results of the discussion were more substantive. The outcome of the meeting should be a framework for the Letter of Intent. If it is obvious during the meeting that the relationship is not a good fit. There should be an agreement as to where we go from here. it could be no more than a "we'll be in touch". so it is important for both the ISV and the prospects to have clearly established objectives. etc. The ISV will want to qualify the company to determine whether they meet the standards they have set for marketing skills. management skills. Decide on the next steps.
15 9.30 16. Page 124 . so there is nothing wrong with discussing specific business terms without getting locked in until you are ready to make a commitment.45 . so avoid the temptation to make a commitment too early.15-11.16.00 Open discussion Wrap up and next steps Note: Even if the first prospect meeting seems to go very well.9.30 . if any Commercial terms Next steps 16.00 Introductions Detailed overview of prospective partner company Detailed overview of the ISV Demonstration of the product and detailed discussions Tour of company premises Break for lunch Potential partnership .00 .00-13.00-12.00 11.00 13.16.15 .45 9.10.00 12.17.details and structure Terms Territory Marketing plan Training Support Joint marketing activities. you will not know which prospect is the best suited until you have met with all of them.00 .9.15 10.00 . You will want the prospects to know that you are meeting with other companies.Suggested Agenda for Meetings 9.
From the reseller: Again. then the managing director will want to join.Who Should Attend? From the ISV: It will depend on the size of the organization. if he is responsible for selecting products. and.Reseller Meeting . Some companies will have a person responsible for establishing or managing indirect partners. to a certain extent. Page 125 . In a large organization this could mean the Director of Sales. but in most cases it should be the Managing Director who sets the product strategy and who makes the financial commitment to support a new ISV. because the relationship could have a significant impact on the development of the company. the size of the market and whether or not the relationship is expected to be exclusive. the management structure. you want to have people attend who can make decisions. so that you can see the level of support your product will get. but they should only go by themselves if they have real decision-making authority since one of the main objectives of the visit is to reach agreement on key business terms. The reseller should also make marketing and technical people available to explain their operations. If the company is going to meet with prospective exclusive or primary partners for the region.
there will be two levels of follow-up required: 1. what did the reseller feel was discussed. The Channel Manager should contact each of the prospective resellers: If they did not make the short list. After the visits it will be important to sit down with the management team to determine: Which companies did they like best? Were there any companies you do not want to pursue. and why? Based on the discussions. what were the conclusions. and what are the next steps? o o o Page 126 .Follow-up to reseller visits Once the visits are completed. what is your understanding of the next steps? 2. thank them for their interest and make sure they understand what why the decision was made. With the prospects. try and get their honest feedback on the ISV and the product: Are they more or less interested in the product after the meeting? Is there anything they had hoped to learn that they didn't? Do they need any more information before making a final decision? If the meeting went so far as to start discussing business issues. and try and keep the door open for other product opportunities in the future If they made the list. Internally.
Better communications. The partner will know the contact people in the company he can call or e-mail to resolve specific problems and it should result in a stronger personal relationship between the ISV and the partner. and he will want to recover those costs by selling the product. Motivating a company's own employees. It helps the whole organization when a foreign partner comes to visit. It is a good screening process to ensure that the partner is serious about marketing the product.Mandatory Partner Training For most products. The cost of the trip and the opportunity cost of the time he is spending away from the office represents an investment by the partner. One possibility would be to have two categories of partners. and the level of support tends to improve. one that has attended training and one that has not. and at the ISV‟s place of business rather than the reseller. and offer a larger discount to those that come in for training and certification. since this will have an impact on a partner‟s willingness to make the investment in training. at least not for all partners. partner training should be mandatory. Page 127 . when a phone call or e-mail comes in from a partner. He will discover different features and functions that will make it easier to sell the product. and he will be in a better position to provide the right level of technical support. Now. Some products may not be complex enough to justify making the training mandatory. for many reasons: This guarantees that the partner will have the product and marketing knowledge he will need to successfully market and support the product in his market. there is a real person attached to the name. Another factor will be the pricing of the product and the expected transaction value of individual sales. He will go home being much more enthusiastic about the product's potential. The product knowledge that he will achieve by installing it on his own machine and playing with it is limited compared to what he will learn by spending time with the developers. because it creates a buzz and some excitement internally when people realize that the business is going places. because the ISV's enthusiasm will rub off on him.
Ask if we can send introductory email. Telemarketing call to decision maker We are a software company doing _____________ Currently recruiting strategic partners in the target market Contacting you to see if this may be of mutual interest Is he/she the right person? Describe the product/service Confirm fit with profile (why this is of particular relevance to prospect) Outline business proposition Would he/she like further details Agree when to send. competitor analysis.g.4 Plan Materials S TM/S 2. C (reject) (against profile. URL. Who is selling products like these? How are they selling them? What price? Who is buying them? More sources for building long-list Put company contact details in spreadsheet – usually from website Triage: A (prime). May ask for information to help triage.3 „Ping‟ TM 2. 1. Create profiles of the likely types of partner that will be successful in promoting the products in the target market (e.5 3. get email address.1 Research TM/S 2.4 1st Approach TM 2. skills. when to call back Who else likely to be involved in decision/evaluation Explain likely order of steps Send Teaser. approach.2 Stage Strategy Profile Activity Develop a sales strategy for the target market.1 Send Materials Qualify TM TM/S Page 128 .2 Build longlist TM 2. B (possible). sector. the client and the relationship offered.Partner Recruitment Checklist No. record salient characteristics & reason for choice) Get name of office-holder most likely to be involved in evaluating partnership approach and CEO.1 1.. size. responses to questions. in some cases a demo Call back: Qualify interest Reconfirm dealing with appropriate person Field questions/objections Reconfirm profile makes them particularly suitable Who?1 S S 1. affiliations) Develop the schedule of activities to be undertaken Call script Identify places to build the long-list of prospects Documents that will first outline the business proposition (teaser) Collect other information on products. etc Prepare demonstrations and presentations.3 1. complementary products.
Stage Activity Describe our preferred next steps.3 Heads of Offer made with Letter of Intent Agreement 5.3 Reclassify TM/S TM/S TM/S TM/S TM/S S S S Application Form 3.Partner Recruitment Checklist No.1 Conferenc Participate in teleconference e Call 4.2 3. etc) Based on responses classify prospect either as “Shortlist” or “Rejected” Send Who?1 3.2 Qualify Re-contact and further qualify 4.2 Qualify List of actions from meeting 5.1 Meet Attend meetings with prospects Prospects 5.4 Set Arrange road-show (if possible) Meeting 5.5 Reference Call vendor references s 3.5 Contract Signed contract 1 TM = Proposed activity for telemarketing TM/S = Could be either sales or telemarketing S = Activity performed by sales (Channel Manager) S S S S S Page 129 .6 Set-up Set up conference call conference 4.4 Follow-up Ensure receipt of completed application form 3. do you know of others it may better suit. get agreement Before conference call require completion of application form If not interested go through „failed‟ routine (reason.3 Answer List of actions arising from teleconference Questions 4.4 Marketing Develop marketing plan Plan 5.
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PARTNER MANAGEMENT Page 131 .SECTION III .
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partners are always going to be concerned that the information will be used for other purposes. Ensure confidentiality. and will drop off unless it moves to the next stage in the sales process. The policy for lead registration should be made clear to every partner. Limit the duration. transparent and applied consistently. It will not be successful if the channel partners do not feel that they can trust the vendor to protect their interests. how long they will be protected.Lead Registration Deal registration is an important channel management tool. In order to be effective the work required should be kept to a minimum. Many sales opportunities will be with departments. Until a relationship of trust has been established. the initial lead might be protected for 90 days. which means that they should be engaged in a sales process. Channel partners don‟t like to spend time on paperwork and administrative tasks. Make it specific. divisions or subsidiaries of large corporations. etc. in which case the lead is protected for another 90 days. Establish and publish the rules. and how much time it takes to move from one stage to the next. and lead registration becomes another obligation. should not be able to register the lead as “General Electric”.. The registration process should track these stages. As an example. so that it captures only the necessary information . reporting for MDF programs. local operation of General Electric. Page 133 . Deal registration programs have to be well-designed. for example. A partner in Florida. Explain the type of information that will be required. and/or sells direct. The registration should be for the specific opportunity they are working on. either to a direct salesperson or to another partner that is able to sell the product at a lower price because they have not made an investment in the sales process. Partners should only be registering legitimate leads. selling to a small. One of the fastest ways to discourage partners from investing in marketing is to let situations develop where they lose a deal that they have been working in good faith. etc. especially in markets where the vendor has multiple partners. what type of leads that should be registered. Access to the registered accounts should be limited to the partner and the channel manager responsible for that partner. marketing feedback. A vendor should know what the typical stages of their sales process is. Some of the key considerations are: Keep it simple. such as feeding leads to the direct sales force. They are being asked to provide pipeline reports.
However. horizontal solutions that can be sold to a wide range of companies will typically require multiple partners in most markets. These processes will be different for banks than they are for retail organizations or manufacturers. Products that are sold into a mainframe environment. Sales are also becoming more verticalized. One of the biggest challenges for resellers today is margin preservation. because one partner will not have the resources to reach the entire market. Even channel partners that specialize in horizontal solutions. Partner compensation. By segmenting the market. This will give them more reason to invest in a focused marketing program. The industry is moving towards Verticalization. When dealing with large vendors that have multiple partners in a territory. and then build their channel strategy based on that segmentation. because it is becoming increasingly important for resellers of enterprise software to understand the business processes of their clients. and ISV can develop marketing messages that target companies based on their size and the industry segment they operate in. Channel expertise. One of the best things an emerging ISV can do is to make it possible for their partners to maintain their margin by giving them control of a certain market segment. but it plays such a big role in limiting channel conflict that it should be explored further.Market Segmentation Market segmentation has been discussed earlier in deciding how many partners to have in a territory. This will really be determined by the technology and the size of the potential market. because they will have to reduce their price to get a sale in a competitive situation. will often have a majority of their clients in one or two vertical markets. Page 134 . such as network management or security. will normally not require or justify having more than one partner in markets outside the United States. the nominal reseller discount that is in their contract is meaningless. Companies should start by segmenting a target market. and prospects are expecting to see the value proposition as it relates to their specific situation. or that will only be purchased by companies with more than $1 billion in revenues. There are several benefits to having segmentation as a central part of a distribution channel: Market coverage. More effective marketing.
3. A primary objective is to make an ISV‟s product a “strategic” product for the reseller. Use a lead registration process to monitor the market. a channel partner based in the London area is unlikely to have a large client base in the Manchester to Leeds corridor. Industry verticals. End users will expect resellers to “speak their language” and have an in-depth understanding of the challenges that are specific to them. Communicate your segmentation policy to the channel partners. each individual segment has to be large enough to provide the channel partner with enough revenue opportunities to make it worthwhile. 2. and legally a vendor cannot prevent this from happening. There will always be a temptation to “poach” a deal from someone else‟s segment. Product portfolio. where repeated on-site visits might be necessary to close a sale. from relatively simple and inexpensive products to more comprehensive enterprise solutions. the length of the sales cycle will often be much longer in the Fortune 500 space. Some ISVs have a range for products. which means that the reseller has to have a meaningful market to go after. Germany has three main geographic markets. This is becoming an increasingly necessary segmentation. since the business processes and computer environments will vary by industry segments. Additionally. the north. Client size. the south and what used to be East Germany. Most resellers will get the majority of their sales from clients that are within a certain radius of their office. but the opposite is not true. it is not costeffective to chase opportunities that are far from their location. If partners are registering their opportunities an ISV will be able deny registrations that are not in the “right” segment. Don‟t over-segment. so an ISV might need a partner to cover that market.Markets can be segmented according to a number of criteria: Geography. In the enterprise space. While it might be possible to segment the UK into two major geographies and several vertical markets. and partners will need the financial resources to support a 6-12 month sales cycle. but do not have the sales skills required to sell into large enterprises at a more strategic level. Some channel partners will be very good at selling into the SMB market. If we look at the UK as an example. It is also possible to carve up the market based on the size of the end user. Page 135 . and expect them to play by the rules. Some important notes: 1. Resellers qualified to sell the enterprise solutions would normally be capable of selling the simpler products.
no matter how many rules are in place. an uplift of 33% would be added to the 60 received from the partner. go a long way toward eliminating channel conflict that can cripple an indirect channel program. if a vendor salesperson gets paid more to take a sale direct vs. so that the amount on which the commission is paid is the same. whether the sales are direct or through a partner. that sale will go direct. so that the sales rep is compensated is if it had been a direct sale. In the above example. sales reps should be motivated to work through. the vendor would receive 60 if the sale goes through a partner. which pay direct salespeople the same margin whether a sale flows direct or through partners. channel partners because they can leverage their time by having more “feet on the street” generating deals. However. he would get 33% more if he closes the sale himself. and 80 if it is a direct sale.Compensation Neutrality One of the biggest challenges for an ISV is managing direct salespeople and indirect channels in the same market. and support. because after a reseller receives a discount the net receipts are lower. and there are few things that are more discouraging to a channel partner than to spend several months working on a deal. so if the sales rep is getting a commission on the revenues produced. The following example shows the impact: List price Street price Reseller cost (40% discount from list) 100 80 60 In this example. only to watch a salesperson jump in at the last minute and close the transaction as a direct sale because it will help him hit his numbers. Page 136 . even if the partner initiates the deal. selling through a partner. This is usually the most common source of channel conflict. This normally occurs when a sales rep receives a commission on the sales he is responsible for. This offsets the negative commission credit impact of selling through a business partner and decreases conflict in the selling environment. Compensation neutral (“comp-neutral”) plans. In theory. Compensation neutrality is accomplished by applying an “uplift” to channel sales.
Page 137 . close the sale and provide support. In its day.g. The ISV (or partner) in the U. or apply it against his next product purchase. In many cases companies make the decision to standardize on a certain product. No other partners are involved. even if their territory is indirectly impacted. Recommendation: The originating partner would get a 10% marketing fee from each sale. for example. 3. but each purchase is made locally.Cross-Border Sales and Margin Splits Most large companies (end users) are active in multiple markets. and this should be managed by the ISV. worldwide price or discount that applied to its operating companies.. purchases everything centrally. and the ISV would either pay this marketing fee to the originating partner. which in turn provides all the technical support to its subsidiaries. The selling partners would receive a discount that is 10% lower than normal (e. There are several ways in which multinational sales are structured: 1. and dictate that its subsidiaries purchase and install the product. There is no reason to split the proceeds with other partners. installation and maintenance go through the partner that initiated the sale.S. go through a product evaluation. Since an ISV is likely to have different partners in different markets. Amway. Recommendation: The entire sale. is responsible for the sale and all technical support to Amway. The company is loosely centralized. and recommended it to its subsidiaries. They negotiate standard pricing and terms. negotiate a standard. 30% instead of 40%). The company is highly centralized. The local partner would keep his normal share of the maintenance. but there was no requirement to purchase it. The local partner in each market where RJR Nabisco was based had to visit with the local subsidiary. and then sends the product out to subsidiaries in more than 40 countries. The company is highly decentralized. RJR Nabisco would evaluate a product centrally. configures the technology so that it is a standard installation. there are going to be complaints from a partner who feels that another partner is stealing accounts from his territory. so it is not unusual to have sales take place that will involve installing and possibly supporting the product in several markets. 2.
the originating partner would get 30% and 10% would be passed on to the local partner. and worldwide purchases are made through the originating partner. Page 138 . 4. The company has centralized purchasing. All he needs to do is contact the local subsidiary. and invoice for the purchase. if the total partner discount is 40%. For example. and allow the local partner to keep the maintenance. but local installation. since the local partner does not have to do anything to market or close the sale.Recommendation: A higher marketing fee is paid to the originating partner. install the product. Recommendation: The local partner gets a participation of 10% in the discount for handling the local installation. the product is installed and supported by a local partner. The standard formula is to split the margin on the sale between the two partners. However. The product is evaluated centrally. but keeps the maintenance fees.
i. trademarks. the ISV would “place” $300-500 in the MDF. Page 139 . putting on a product seminar. Push training. and if the requirements are too restrictive they won‟t bother. layouts. The purpose is to encourage a partner to spend money promoting your product. text. etc. Over time some initiatives will be more successful than others. Allow the partner to use the funds for sales and technical training. Measure the results. The partner can be reimbursed in cash or as an extra discount against future purchases. to make sure they actually spent the money. participating in a trade show. Make it easy for them to access the approved marketing materials they can use. MDF is usually done on a co-op basis. If they have run a display ad. get a copy of the ad and the invoice. but keep the door open for the partner suggesting something he would like to try that you may not have thought of.000 of product. so use the program as a way to finetune your marketing program. etc. and this might vary by market. such as logos.. both parties participate in the cost of approved marketing initiatives. fonts. The percentage is generally 3-5% of purchases. Extra discounts are easier than sending money. and communicate the training programs and resources that are available. but some partners like the idea of getting “cash”. so that if the partner purchases $10.e. Describe the approved marketing initiatives. Some points to keep in mind are: Make it easy to use. Require receipts. As this builds up the partner can use the money to cover 50% of the cost of running an ad.Market Development Funds (MDF) MDF can be a good way of supporting the efforts of a channel partner without subsidizing marketing expenses up-front.
Sales contests can be tailored to meet the needs of an ISV. with one “lottery ticket” issued to a reseller or a salesperson for every documented evaluation during the quarter. depending on the value of each sale. such as a plasma TV or a cruise. so an effective sales contest can be structured around activities that generate prospects. In order to close sales there has to be a pipeline. and are usually short term in nature. but everyone who produces at least one evaluation gets to participate. if installing and evaluating a demo early in the sales process is a key step in getting commitment from a prospect. and could range from a nice dinner for two to something more substantial. and the importance of building the pipeline. for instance: focusing on a specific platform if the product is multi-platform introducing a new product (e.g.Sales Contests Sales contest differ from quota clubs in that they are more specific. The person with the highest number of evaluations has the greatest chance of winning. One way to structure the contest is to have a quarterly “lottery”. It is often a good idea to base a sales contest around activities rather than sales. which means that there is little a reseller can do to impact the outcome in the short term. Page 140 . The prize should be something other than money. For example. and paid out quickly. whereas quota clubs are normally for annual results. first three sales) moving into a new vertical market up-sizing the average sale (prize for the largest sale) expanding the market (sales to new customers as opposed to repeat sales) reaching year-end objectives Sales contests can be creative and flexible. The sales cycle for many complex technologies can be 6-12 months. then getting more prospects to evaluate the product in a given quarter could be the measurement.. but work best when the reward is tied directly to the desired result. The sales that close in a given quarter were actually “made” one or two quarters earlier.
Prizes are usually all-expense paid trips. and can benefit from sharing a wider range of experiences. try to set targets for the salespeople (or a product group). for three days to one week. with all of the winners going to the same place at the same time. Some companies like to combine their domestic and international rewards so that a larger group travels together. When setting the targets. the numbers should be based on the relative market sizes. While it can be difficult to monitor. Page 141 . and make sure that the targets are set high enough to cover the prizes offered. so that partners in smaller markets have an opportunity to win as well. rather than the partner's company as a whole.Quota Clubs Quota clubs are a way to reward the actual salespeople.
. especially if the product is sold by multiple salespeople. such as $100 for each license sold by the end of the month/quarter. and if the salespeople are responsible for selling multiple products. Make sure that the partner's management agrees to this. Spiffs are a good way to influence the individual salespeople in a partner organization. because they may object if they feel that spiffs are not consistent with their internal objectives or compensation plans. or to focus on a specific product within a product line.Spiffs Spiffs are commonly used in the U. Spiffs can be used for short term goals. Page 142 . and it means giving cash or merchandise directly to the salespeople responsible for your product.S.
This report is important because it confirms that the partner is doing his job. It gives the channel manager a basis for evaluating his performance. combined with a second mail shot to a different group of targets. the ISV will have a basis for terminating the partner. rather than having to wait six or twelve months to confirm that the sales targets aren‟t going to be met. and make sure that the partner understands that he is expected to execute the marketing plan that had been agreed upon. or perhaps suggest other marketing techniques that might be more effective. If. and it gives him/her a reason to call the partner every month. the result. Since there may not be a pipeline to report in the first few months. It may well be that the partner sent out a direct mail piece that generated little or no response. After the first month. the manager should make a note of it.Initial Marketing Reports This refers to the report that the partner should be submitting on a monthly basis. and what they plan to do the following month. Page 143 . at the end of the first month. the partner says that he didn‟t send out the mailing he was supposed to do. the focus would be on what they are doing to market the product. The report also gives you a chance to work with the partner to modify the marketing program if it isn‟t working. This could be a narrative report describing the marketing actions that were completed during the month. of which 35 responded with a request for additional information. and that he plans to call each of the 35 prospects. for example. If the partner hasn‟t done anything by the end of the second month. the partner might report that he sent a mailshot to 1000 companies. You can then try and suggest changes to improve the quality of the mail piece.
However. Page 144 . and to keep the partner focused on selling the product. be aware that some partners will resist registering their prospective clients. and perhaps give you an opportunity to make recommendations on how to shorten the cycle if it seems to be unusually long. If the partner has to submit a monthly report. The objective is to give you some positive feedback. We recommend using a standard Excel spreadsheet format for this. it will give you an idea of what the sales cycle is in different markets. the expected dollar amount of the sale. It is important that the reporting not be complicated or time-consuming. The purpose of this report is to show the overall level of activity in a market. how far they are in the process. and because they dislike unnecessary paper work. partly out of mistrust (concern that their ISV will try to sell direct and cut them out). and what the likelihood of closing is. he will not want to send a report that shows no progress.Pipeline Report Registering prospects that are generated. It will list the companies that are evaluating the product. In addition to showing what the pipeline is.
S.Proposal (Evaluation completed and successful.Approved (Verbal approval received.Sample Pipeline Report XYZ Sales & Marketing Report for the Month of _______.$) Final Price (U.$) Company Product(s) Quantity Status Comments STATUS $ = Payment has been received A = 100% . contract negotiation in process) C = 70% .$) Estimated Month to Close Total Sale (U. decision pending) Page 145 . PO issued) B = 90% . proposal issued.Sale (Documents signed. 2008 List Price Discount (U.S.S.
Out-bound leads are inquiries received by the vendor and that are sent back out to the most appropriate channel partners. and even customers to link everyone together in an extranet-centered communications web. marketing programs. Information about a prospect that is captured in the lead management module can be fed into the pipeline report. The portal can also be used to implement and track marketing programs that are tailored to individual channel partners. including sale cycle analysis. can vary in complexity and functionality. The partner database becomes the repository of all reseller information. forecasting and pipeline tracking. literature fulfillment. As it evolves. authorizations. Some of the features that are often found on partner portals include: Marketing The portal can be used for a wide range of marketing-related functions. test scores. lead distribution. At their core is a partner profile database (usually SQL Server) with an interactive communications capability that can be used by resellers. channel managers. and the portal uses this data to improve communications. and dynamic partnering processes within the extended sales enterprise. Vendors define which information goes to what classes of partners and then use the extranet capabilities to automatically put this intelligence into the hands of specific partners. and the partners‟ follow-up. close rates. and they register the leads with their vendor in order to ensure their exclusive right to purse that prospect. Page 146 . vertical market expertise. Targeted lead can be routed based on partner profiles including geography. it can be used to track leads generated by specific marketing initiatives as a way of measuring effectiveness. At its simplest level it is a repository of marketing materials that can be downloaded by partners. In-bound leads are generated by the reseller. The portal is an ideal tool to follow the progress of sales. also called Extranets. Lead and Sales Management This can be both in-bound and out-bound lead management. complementary services. the order processing system and accounting as it moves through the sales cycle. reseller sales people. etc.Partner Portal – Main Elements Partner portals. product certifications.
on-going supplemental training can be provided more effectively on the portal. channel partners should be able to manage this within the agreed parameters (e. Training and Technical Support While the initial training will normally be in-person. Once the basic components of the programs have been established. scheduled webinars. etc. payment requests can be submitted and approved electronically. The portal should also be used for automated tech support. and a searchable database of resolved issues. certification requirements. the ROI of each initiative can be calculated if they are linked to the lead generation module.. no more than one 60 day renewal for an extended evaluation) Process orders Submit payments when credit cards are accepted Page 147 . If the products have soft keys that can be renewed for extended evaluations. More sophisticated functionality would include automated trouble ticket tracking. each partner should be able to access their specific program on the portal. Order Processing and Payments The system can be integrated with the accounting system. allowing partners to: Manage keys on-line. using e-learning technology. At the very least it should contain an FAQ that covers most basic issues that are likely to come up.MDF and Co-op Marketing Program Management MDF and Co-op marketing programs can be automated using the portal. new product information. It can be the source of course information.g. and/or temporary keys that are issued to correspond with the payment terms. Both the vendor and the partner will be able to view allocated and under-utilized activities.
provide some background information on the company and the salesman Management profiles. adding items as they go along. and then send it out once they have filled up a page Fax it. or every month at the same time The person writing it should keep it as an active file. Possible topics: New product developments Sales successes. with a minimum of fancy formatting and graphics. never to be seen again. newsletters can play an important role in keeping partners informed. preferably to one page. any managers that were introduced to partners during the training) done something interesting lately? Suggestions: Keep it short. so e-mails and attachments that are not urgent either stay in the in-box (and quickly drop off the screen) or are filed away. Announce and describe new partners as they are recruited. both domestically and internationally. It is important that it not be a burden to write. Welcome them aboard. Keep in mind that they are working isolated from the ISV.Regular Newsletters Short. and in many cases partners keep a file of the newsletters they have receive Page 148 . This lets a partner know that there are things happening and keeps him motivated. Spotlight partners that have done particularly well. or the international manager won‟t find the time to do it Don‟t worry about keeping a regular schedule. Have you hired new people? Have any of your managers (in particular. and keep it simple. People love recognition! Partner profiles. but regular. Companies are getting overwhelmed with e-mail. so they will not always be aware of the exciting developments that the company is going through. and to make them feel part of a larger community. either domestically or internationally Incentive programs Scheduled training programs that are open to international partners Monthly or quarterly list of the top five or ten partners. and e-mail it. A fax will always be printed out and put on someone‟s desk. especially if he is having a tough time getting started Describe new marketing programs that have worked. and give them some visibility in the network. such as every two weeks.
The review is actually a re-qualification of the partner. price sensitive.. and preferential. . breakdown by addressable products & industry) 3.Annual Partner Review An extensive annual partner review would be limited to partners that have a significant. vertical or geographic markets were targeted? 2. It is a good way to summarize the status of their efforts. Size of the market (total market value & growth. to determine whether they deserve to be renewed on the same terms. but can be done by phone or video conference if travel is impractical. Name of partner: Territory: Name of Relationship Manager: Product & services offering: Products/solutions (in relation to market positioning) First level hardware support. warranty. Market positioning: which horizontal. This review should ideally be done at the partner‟s facilities. volumes. social. sales penetration. expiration date of agreement MARKET POSITIONING 1. Current contractual status with ISV (VAR. Marketing Strategy and objectives: differentiation from competition. 2. 6. technological or regulatory trends that affected the market SALES PERFORMANCE 1. Main characteristics of the market: well funded. OEM. BASE DATA 1. few large sales or volume sales? 4. particularly those that have been granted some level of exclusivity. Target list: who were the major prospects? 5. Successes and reasons: 2.. procurement process. relationship with the ISV. Counter performance and reasons: Page 149 . Economic. spare parts Software support Training System and/or network integration Facility management Service bureau Other 5. political influence? Custom or off-the-shelf applications. 3. 4.). SI. innovative? Type of purchase cycle. image. and where they want to go from here.
projections 2003 Projected Actual SW Licenses Upgrades Maintenance New clients Win-backs 2004 Projected Actual 2005 Projected Actual Installed Base Industry 1 Customer 1 Customer n Industry 2 Customer 1 Customer n Product/Application Revenues Clients (last year and estimate for this FY) Last FY Total Number of Clients Active Clients Long term clients (active more than 12 months) Average transaction value in US$ This FY (est) Analysis of Revenues Total Group This FY Next FY (budget) (estimate) Of Which ISV This FY Next FY (budget) (estimate) Category SW Licenses Upgrades Maintenance Services Other TOTAL Last FY Last FY Page 150 .Actual vs.
4. 2. customer satisfaction MARKET TRENDS 1. 5. ISV support: Training Software support Programs for staff training 2. 3. 3. Partner support: Education Software support Staff training & skill sets Discussion on issues affecting support and maintenance of installed base. 2. 3. 6. Overall sales performance Pricing strategy Strength by market segments Losers/winners Future strategies Partnership/alliance Page 151 . 2. Pricing competitiveness: Training offering available in country: Technical support coverage and pricing competitiveness: Product performance issues: COMPETITION 1. Strong segments (application/product) Declining segments Emerging application/markets Future large bids Customer buying behavior PRODUCTS & PRICING 1. 4.TECHNICAL SUPPORT (may be reviewed separately from marketing review) 1. 4. 5.
technological or regulatory trends that can affect the market 6. few large sales or volume sales? 4. Market positioning and potential: which horizontal.ACTION PLAN CURRENT & FUTURE MARKET POSITIONING & SALES OUTLOOK 1. Main characteristics of the market: well funded. Economic. innovative? Type of purchase cycle. Sales projections (most likely and best case) by product line. application and industry with assumptions for the next two years (note: the spreadsheet on the following page provides a guide for the estimation of the sales activity for the period): Page 152 . Target list: who are the major prospects? Strategy to win? 5. social. political influence? Custom or off-the-shelf applications. vertical or geographic markets will be addressed? 2. procurement process. price sensitive. Size of the market and trend: 3.
000 0 25 25.000 0 25 25.000 CUSTOMER APPLICATION COMMENT FINANCE & BANKING Sub-Total TELCO 100.000 100.Partner's Name : Prospect List & Sales Outlook (2007-2008) US$ Contract Value Probability of Win % Est'd Qtr Close Probability Slippage % in 2007 Amount in 2007 % in 2008 Amount in 2008 25 100.000 0 25.000 10.000 Sub-Total GOVT 100.000 25 2.000 100.000 50 50.000 0 50 50.000 50 50.000 50.000 0 25.000 50 5.000 50.500 Page 153 .000 Sub-Total OTHER 100.000 50 50.000 0 25.000 50.
Lead generation and qualification program 4. List areas of ISV assistance sales & support: 2.Horizontal markets targeted . List other: INTERNAL ONLY – Not to distribute to partner INTERNAL ASSESSMENT OF THE PARTNER 1. Base data .Date expiration of agreement: .Vertical markets targeted .Exclusivity: . 5.Partner type: .Territory: . Pricing strategy 2. Field service and support personnel number and training schedule.Average discount from US List: .List ISVs represented .Complementary with ISV: Page 154 .Name of partner: .Partner since: . Structure of other services: professional services.Revenue Goal current year: . Promotion and Marketing Communication plan and budget 3. application support. system integration. KEY SUCCESS FACTORS 1.OTHER MARKETING MIX & SUPPORT 1.
- List ISVs represented - Competitive with ISV: - Main competitors: - Largest installation in $, type: - Current customer base in $: overall - Current customer base in $: ISV
2. Comments: - ISV fit (culture, product offering, market strategy): - Biggest strength: - Reason for success: - Biggest weakness: - Reason for non-performance - Recommendation of action plan:
INTERNAL ASSESSMENT OF THE PARTNER
(can be use for ranking)
1 = poor
5 = excellent
1 Overall expertise in ISV Products Expertise in application SW support Quality of sales organization Quality of indirect channels & partners Sales volume and growth since last review: overall Sales volume and growth since last review: ISV Experience in efficient promotion techniques: overall (advertising, trade shows, industry seminar, ...) Implementation of efficient promotion techniques : ISV Partner's cost structure and gross margin Discount/concessions practices : overall Pricing strategy for ISV products Geographical coverage of territory Vertical market coverage for targeted markets Horizontal market coverage for targeted markets Overall business experience Quality of Management Known litigation (No = 5, Yes = 1) Reputation with suppliers, banks and customers Export control and protection of intellectual property Physical facilities (size, location, warehouses, etc...) Financial strength Knowledge of business methods and measurement standards Qualification of the management team & dedication to ISV versus other ISVs represented Communication with ISV Customer satisfaction TOTAL
Regardless of how carefully prospective partners are screened and qualified, or how well they are managed after they have signed, a company will find it necessary to review their performance on a regular basis, and in some cases terminate them. The most common reason for termination is a partner not meeting specified performance goals, be it implementation of the marketing plan or sales targets. If the relationship does not get off the ground, and the partner‟s performance is dismal from the start, then termination should take place sooner rather than later. It is not as clear-cut, however, if the partner has met his targets, but is showing a drop in sales, or an inability to increase sales while other markets are growing. In this case an ISV should make an effort to determine what the cause of the slump is, rather than summarily terminating the agreement. If a partner has had some level of success with a product, it can be difficult and time consuming to replace him with someone that can do better. And in the meantime sales will drop further, and the product‟s reputation in that market could be damaged, making it even more of a challenge to find a replacement partner. There are a number of things that can impact product sales in a market. Some of them are temporary, while some of them could be long term and justify termination: The product manager/lead salesman left the company. check with the owner to find out why they left and if he/she is being replaced if possible, contact the person who left, and find out why if it is a woman, is she on maternity leave, and will she come back? Maternity leaves, especially in Europe, can last six months to three years What was in the pipeline when they left, and what is being done to follow up? If the success of the product was based on the efforts of one salesperson who has now left, and the company has no intention of hiring or appointing a replacement, termination should be considered. A competitor has taken over the market Is it a local competitor, or another foreign product? What are the key factors to its success? Better technology? Better price? Local language? What does the partner need from you to become more competitive? The market has become saturated. Market conditions will vary from country to
The market is in an economic slump. and replacing them is not always the right answer. Again. Political uncertainty has made companies nervous about spending money. and since many markets are fairly small to begin with. The exchange rate has made the product much more expensive in the local currency. Page 158 . try and confirm the trend with other ISVs who are in the same market. economic problems in Asia and Brazil have made it impossible for partners to meet their targets. Many ISVs responded by dramatically cutting their prices in those markets. so that the price to the end user stayed in the same range as before. this is something that happened throughout Asia and Brazil. In the past. and the partner is having a difficult time closing sales.country. If this is the reason given by the partner. it is possible that they will reach saturation sooner than others.
and/or there has been a significant investment by the partner. but first the non-payment has to be documented. While there are certain provisions that can result in immediate termination. non-payment is a reason to terminate. For instance.Importance of Notices Most good agreements will have notice periods before termination can take place. If the relationship with the partner has been of a long duration. it is best to handle the termination by the book. or “we didn‟t get the invoice” as an excuse. This means that the ISV has to send a notice by registered mail or an express delivery service that generates a signed receipt. Page 159 . It is important to comply with the notice requirements to avoid the possibility of being sued for unjustified termination. and be given a certain period of time to rectify (“cure”) the default. telling the partner that the payment is past due and that it has to be made with x days. most require that the partner be notified of the default. This is to eliminate “the check is in the mail”.
Master Checklist – 12 Month Activity Plan In progress Due Date Strategic & Policy Decisions Initial target markets Channel strategy (VARs? OEMs?) Revenue objectives for each market Pricing and payment policies Order form Discount structure Maintenance fee policy Credit policy Internal Support Develop profile of channel manager Hire channel manager Marketing support Company & product profile Competitive matrix ROI analysis Documented sales process Pre-designed web pages GIM and/or white papers Hi-level PPT presentation Technical Issues Document the integration issues Identify complementary technologies Establish tech support procedures Develop soft keys and policies Legal Issues Trademark registration Patent search Partner application Non-disclosure agreement Letter of Intent Formal Contract Partner Support Programs Sales training program Technical training program Partner manual Program for partner conference Page 160 Done Activity Person responsible for the activity .
In progress Due Date Partner Recruitment Define partner profile Build long list of prospects One-page outreach letter Telemarketing script Process for remote evaluation Agenda for prospect meetings Partner Management Format for pipeline report Sales programs and incentives Quota clubs Spiffs MDF program Sales contests Newsletter template Policy for cross-border sales Annual review process Page 161 Done Activity Person responsible for the activity .
12 Month Activity Plan Worksheet Time Frame Month 1 Process Who Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Months 10-12 Page 162 .
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