How to Work with Channel Partners to Maximize Sales Volume

Whether you want to launch a channel partnership to tap into new markets, scale up quickly or meet customers’ needs better, this guide will help. Learn how to work with channel partners to maximize sales volume.

Also read:

• Why Relationship Selling Is Essential For Increasing Sales
• How to Build an Outbound Sales Team with Collin Stewart
• 8 Proven Strategies To Increase Healthcare Services Sales

What is Channel Sales?

Channel sales (also known as indirect sales) is a way to distribute a product to the market by segmenting sales operations to focus on different selling modes.

Simply, it’s a sales strategy in which a parent company sells products through another company. As a result, companies sell through third-party partners or someone else who doesn’t work for them directly in channel sales models.

While complex sounding, most people are already familiar with channel sales. They comprise around 75 percent of the world’s sales and consumer market.

What are Channel Partners?

A channel partner is a business that couples with another entity (e.g., manufacturer or producer) to make, market, and sell their products and services. In general, the whole process is a co-branding relationship.

Channel Sales vs Direct Sales: What’s the difference?

Overall, there are two main sales channels: Direct and Indirect. Many businesses use a mix of both because different customers prefer to buy through a particular channel—for example, either a retail store or manufacturer, respectively. As a result, these two channels have different revenue streams. These include new sales, upsells, and cross-selling, each requiring different tactics to be successful. Therefore, the difference overall is that indirect sales use a “go-between,” and direct selling doesn’t.

Benefits of working with channel partners

Not sure if a channel partner strategy is right for you? Discover the benefits and challenges of adopting one:

• Built-in Credibility: When channel partners are an authority in the market, you don’t have to spend as much time establishing a brand presence because you already have an endorsement for your product.
• Quick Testing: With channel partners who allow you to experiment with products, packages, promotions, marketing campaigns and new customer bases in a low-risk, low-stake environment.
• Customer Service Success: Partnering with vendors lets you focus on new business while they take care of customer onboarding, implementation support and service.

Challenges of working with channel partners

• Some Credibility Risk: You must always choose someone with a known positive reputation, especially for excellent customer service.
• Harder to Manage: When you’re not directly managing the sales process, it’s harder for your reps to help if a partner mismanages a deal.
• Slower Feedback: When channel partners talk to your customers, feedback will always take longer to get back to you. More so, it’s not even guaranteed to be an unreliable, inaccurate and potentially biased interpretation.

9 Types of Channel Partners

1. Affiliate Partners

A retailer commissions website owners, businesses, and individuals who promote their products in an affiliate partnership. Affiliate partners often receive a percentage of each sale they are responsible for bringing in.

2. Resellers

Resellers purchase products from the company producing them and then resell them to the appropriate customer for profit. Often, Resellers are the intermediary between the company and the final customer. As a result, customers go directly to resellers to initiate the purchase, and then the reseller works to source and fulfill the order.

3. Distributors

Distribution channel partners provide products straight to the customer and, like Resellers, often serve as intermediaries between the companies that produce the products and the final buyer.

4. Agents

Agents facilitate deals between buyers and sellers, aiding the negotiation process. Therefore, they serve as an intermediary without owning the products or services they sell.

5. Dealers

Dealers are channel partners that sell directly to customers. Yet, they often specialize in products rather than a generalist like retailers. For example, a typical type of dealer is a car dealer who sells or leases cars to end-users.

6. Wholesalers

Wholesalers are a type of distributor. Yet they specialize in providing physical products, like those on store shelves, ready for end consumers to purchase.

7. Value Added Reseller (VAR)

Value-added resellers specialize in purchasing and reselling technology products. Often with additional software or features beyond the original standalone product features. For example, a computer company sells hardware using a different company’s software.

8. Independent Retailers

Independent retailers are business owners who operate a retail company that is not associated with any major brand.

9. Consultants

Channel consultants connect vendors, retailers, manufacturers and distributors to ensure the product reaches the customer as intended. Though channel consultants do not directly sell, they play an integral part in ensuring sales channels run smoothly.

What makes a successful channel partner?

The best channel partners in sales have absolute clarity and insight into their customer base. More so, they’re relentless about customer value and experience.

How to implement a channel sales strategy

Want to start with a channel partner but unsure where to start? Use our tips below to get an idea of how you’ll structure and manage your strategy:

1. Develop Co-Branded Assets & Templates

You’re a team, so working as one makes sense. The best way to create alignment is to create templates that your partners can use to develop additional content and sales collateral.

When looking to promote your partnership, you should continually develop co-branded content for use on both of your websites and landing pages, such as:

• White papers
• Surveys
• Case Studies
• Infographics
• Ebooks
• Videos
• Webinars

2. Train their Sales Team

Having both sales teams train in the same methodologies and understanding of your product will streamline results, and all reps will know how to sell your product to those who benefit the most. 

A cost-effective method for training another company’s sales team and your own is an E-learning portal like SOCO/ Academy. 

Another great way to maximize learning is implementing blended learning, a combination of e-learning and live training. You can do this either online through webinars or in person. Either way, it allows for additional collaboration and customization of training.

3. Aid Tool Implementation

Always make sure your channel partner places any co-branded tools and content on their landing pages, social media pages, and generally, where appropriate, across their website (articles, downloads, etc.) You can ensure they leverage them best by guiding them with suggestions for the best placement of your tools and offerings.