Dell EMC provides revenue, rebate specifics for new channel program

fills in the remaining blanks in what its new unified partner program, which formally rolls out today, will look like.

, Global Vice President, Channel , Dell EMC

Last October at Dell EMC World, the newly unified company provided a broad outline of the partner program it intended to launch at the beginning of its new fiscal year. While it provided some important specifics about big picture elements like program unification and tiering, many of the more specific details remained to be fleshed in. Today, the company is providing these details, adding specifics about nuts and bolts. In particular, they indicated more mechanics about how partners will be compensated.

“What we are sharing now is the specifics of the revenue requirements and the rebate architecture, to indicate what the margin looks like for partners,” said Cheryl Cook, Global Vice President, Channel Marketing, Dell EMC. “We told partners in December that we would give them a status match to the new program, that all partners in good standing will map into the same status they had, and that if they were higher with either Dell or EMC, that they would map into the higher status for the new fiscal year. They now have specific revenue and requirements they will have to achieve at the end of the year to stay in that status.”

Tier eligibility has two paths, with different eligibility criteria.

“We have two paths to a tier because we recognize that not all partners look alike,” Cook said. “Some partners are in multiple lines of business, and some are more focused.” The more diverse partners have lower thresholds to meet, reflecting the spread of their efforts across multiple practice areas.

The new rebate system may be the most anticipated element of the program because of its implications for profitability. It has five stackable components: the base rebate; accelerated rebates for growth; attaching ; new business (broadly defined) and , which is both earned and proposal-based.

The base rebates are 4 per cent for both servers and storage and 1.5 per cent for clients at the Titanium level – the top tier of the standard tiers in the program, but underneath the invitation-only Titanium Black.

“Base debates are paid from the first dollar of sales,” Cook said. “The other rebate incents are for driving strategic incentives. Meeting growth targets gets an accelerated rebate opportunity. For the Titanium tier, storage is incented at 6 per cent, while servers are at 1.5 per cent and clients at 1 per cent.

Service attach rebates for the Platinum tier are 1 per cent across the board.

“We want partners to focus on services as a mix of their business, by attaching ProSupport and maintenance,” Cook said.

The New Business incents are significant – 8 per cent for both storage and servers and 4 per cent for clients at the Platinum level.

“We are really focusing on new business, which means both new logos or expanding into adjacent lines of business with existing customers,” Cook said. “We have made considerable investments in the program to do this.” Dell EMC says the total amount of new money added is $150 million, which also includes the MDF.

The MDF eligibility begins at the Platinum Tier.

“We are making financial investments there as well, with the MDF funding going up by 8 per cent year-over-year,” Cook said. “The proposal-based MDF funding is being increased by a third. This is exciting for partners, because it will let us tailor very specific plans.”

“Our partner advisory board would tell us that legacy EMC’s program was more predictable, while Dell was more lucrative,” Cook stated. “They asked for us to give them both, and we have tried to do that. We’ve tried to strike the right balance. We have also made investments in better visibility so partners can see where they are in the attainment of rebates and MDF. There will be weekly, automated dashboards to show where they are.”

The most difficult element in all this is getting all the automation done, and Cook acknowledged everything may not be finished on February 20, when the new unified portal is scheduled to go live. However, she also said that if this is the case, partners won’t notice.

“If we have to do things manually until the automation is complete it will be invisible to the partners,” she said. “We have simplified the processing and automation significantly in the unified portal.”

Training in the unified program combines recognizable elements from both the EMC and Dell sides of the house.

“EMC had industry-recognized training, and we are maintaining that for sure,” Cook said. “The program now has both individual and company . Before, Dell never had individual , as they were at the company level. Dell also had competencies, and EMC didn’t. We now have all these going forward.”

Cook said that Dell EMC is also investing more in distribution with the distribution program.

“We have a lot of consistency in the program around distribution that I don’t think we have had in the past,” she said. “We are looking at those programs very holistically. The rebate structure for solution providers is distribution-centric. We want the distributors to bring us more new partners.

Not all the global distributors have been set, and by the end of Dell’s Q2 [July], the company will have notified which distributors are continuing. Cook said a lot of the global distribution congestion came from legacy Dell, because distinct sub-brands like Wyse tended to have their own distribution.

“We will be rationalizing all that,” Cook said.

“Canada and the U.S. similar are similar in that we will retain the closed door model on the high end, while it will be open source for the transactional business,” Cook added.

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