Partners Sales Vs direct sales – Ultimate guide #1

Partners Sale Vs Direct Sales Know the Difference

A dilemma for a successful growing company is how to sustain and even increase revenue, but at some point, they recognize that they need to grow either with their sales personnel by investing and employing people, which may not be the greatest investment.

One of the most difficult aspects of increasing revenue. Your salesmen have a limited amount of time. Even if you hire the most focused people, invest in tools that increase their efficiency, and eliminate all distractions, there are only so many selling hours in a day.

A challenge for the successfully growing company is how to maintain their revenue and even increase it but at some point in time, they realize that they need to grow either with their sales staff by investing and hiring them, which may not be the best investment.

While direct sales personnel may be effective, they are not the only solution. There is a cost associated with hiring and employing direct sales personnel, which will directly reduce your margins.

What about the partners? A partner, in general, assists a vendor, supplier, or manufacturer in expanding their business/sales. Instead of a direct sales team, a channel sales model presents a new viable option that will help product sales, marketing and distribution.

Direct sales model

company sells its products and services directly to consumer through direct sales. In direct sales model, the sales team is in charge of raising revenue.

Partners sales model

Who requires partners? Small businesses can employ partners to expand their operations without having to invest in hiring and training a sales crew.

Let us see the benefits of acquiring partners vs sticking with direct sales personnel

Partners offer numerous advantages to vendors, ranging from extensive geographic coverage to in-depth industry knowledge, integration capabilities to tailored service and support, and local intimacy to trusted adviser.

What exactly is channel sales? A channel sales model is one in which a corporation sells through third-party partners such as affiliate partners (who receive commission on each purchase), resellers, value-added providers (who often package your product with their own), or another organisation that does not work directly for you.

Partners Sales Model

Benefits of Channel Sales

Benefits of Channel Sales: Channel Sales brings the Built-in trust, your channel partner is already a well known within a market, you don't have to build your brand presence. Your product automatically gains the credibility with your partners endorsement. Channel Partners bring in the increased efficiency of staff utilization, partner communication and revenue optimization. A successful partner can help in customer training, on-boarding, implementation support and service with regard to a vendor, which helps you focus on your business without worrying.

The Channel sales, also bring in some inherent cons, for example you are not directly managing sales, less control over sales, your representatives might not be able to take control of the process if a partner is not handling your sales properly. Important to consider a partner with good brand value, selecting a partner with poor reputation brings a bad news for your business. In exchange for closing deals, managing sales and having less staff, your partner also takes away a percentage of the sales fee.

Partners have a greater industry experience, that makes them ideal for a partnership, the expertise they bring in from the industry helps in shaping the product, allowing direct team to put their focus on their greatest revenue potentials.

Greater Geographic coverage, partners will assist you in covering a wide range of locations, products, and sectors, allowing your direct staff to focus solely on your largest accounts with the highest revenue potential.

VARs having a broad global reach can assist partners in covering a wide range of geographies, products, and industries.

Support, Service and Integration for customers: Partner can frequently incorporate a broader solution for consumers. This is a win-win situation: your product or service is sold, and your consumer receives a tailored, all-inclusive solution.

VARs will add additional elements to the vendor’s primary product or service to give their clients a complete solution. These services are what enable a solution to function in each customer’s specific environment.

Brand trust: With their endorsement, partners can help achieve local closeness and carry their reputation along to achieve product trust.

Should my company employ a channel sales strategy?

Should my company employ a channel sales strategy? Adopting a channel sales strategy can be a difficult decision for many firms, particularly those that are hesitant to entrust their image and brand authority to third parties. However, as previously said, these tactics have their advantages.

To assess whether pursuing channel sales is good fit for you, you should ask yourself the following questions.

Not every company is good match for channel sales strategy, and whether you should use one is determined by few variables.

Is my company's capacity to manage growing demand?

At its essence, channel sales strategy is growth plan. 
You're broadening your sales channels, increasing brand awareness, and eventually positioning yourself to sell more of your product or service. 
So, if you want to pursue channel sales, you must be prepared to handle everything.

Is my sales process productive, repeatable, and easily available to channel partners?

When developing an effective channel sales plan, the primary sticking point may be how you market your product or service. So, if you want your plan to work, you must have a proven sales process, a solid grasp of your target market, and an easy means to communicate those elements to channel partners.

Are We prepared to put my brand's reputation in the hands of potential partners?

A channel sales strategy is heavily reliant on trust. You're allowing people outside your business to market your product on your behalf, which implies you're giving up some control without giving up too much accountability.

Both parties will be unhappy and disappointed if these essential criteria are not addressed (paying anyone, no on-boarding process, no training, unclear how the partner produces revenue, ambiguous programme elements, lack of resources, etc.) Taking some time to manage each of these with care will result in robust partner foundation.  The vendor can now aggressively recruit ecosystem partnerships in order to expand market coverage, revenue, and relevance and value to their customers.


Partners Sales Vs Direct Sales Partnerships

This article is published on 22/07/2022, it has been updated.