Partner exclusivity is rare and that’s good

Ciena and Ericsson working together on SDNVendors like to talk about partner loyalty and how solution providers are extensions of their sales forces and go-to-market . The truth is few solution providers place all of their bets on just one vendor, and most sales involve multiple products from multiple sources, according to by .

Only 13 percent of solution providers surveyed by 2112 for its annual 2014 Channel Forecast report say they work with just one vendor. The majority, 68 percent, work with four or more vendors, and one-quarter work with 10 or more on a regular basis.

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Larger solution providers — those with gross greater than $25 million — tend to work with 10 or more vendors, while smaller companies — those with less than $5 million — work mostly with four or fewer vendors.

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While many vendors would welcome the opportunity to have complete partner loyalty, such arrangements can be detrimental. Customers need systems that cross multiple technology domains, and no vendor can supply all of the products and services required to create holistic systems that meet end-user needs.

This can be seen in the average number of products sold by solution providers per deal. The majority of sales by solution providers — 51 percent — have two to three products, reflecting how solution providers are cobbling together technologies to meet customer needs. Only 17 percent of solution provider sales are of a single product.

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Representing more vendors doesn’t equate to greater growth or success, though. Solution providers that work exclusively with one vendor and those that work with 10 or more have lower growth expectations and results than those balancing their relationships. The Goldilocks zone  for a higher rate of growth is between four and eight vendor relationships.

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This all adds up to the need for solution providers to develop strategic plans, identify the customer and problem, and then create the right mix of vendor partners to source and support that go-to-market vision. Solution providers with this vision tend to have higher and sustained returns on their investments and efforts.

The 2014 Channel Forecast report is available to 2112 research subscribers. Premium versions of the report are available to nonsubscribers athttp://the2112group.com/product/2014-channel-forecast-the-shrinking-channel/.

A complimentary summary is available at http://the2112group.com/product/2014-channel-forecast-the-shrinking-channel-free-summary/.

This article originally appeared on Channelnomics.com.

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