leveraging partners for sales

Working for a start-up, sales people have a huge challenge: they need to exploit general opportunities while under incredible pressure to show results quickly.  The sales folks need to educate potential customers about products and adjust to customers’ buying processes while also chasing down and making every possible sale in order to drive business.  That’s a lot of work and keep in mind startups are constantly worried about selling costs and cash so you can’t throw a lot of money at the problem.

Given we have to create awareness about new products and generate quick sales - both with limited resources - how do we do this efficiently and effectively?

Well, perhaps it is time to leverage partners to save on the costs of building and maintaining your sales force?  Partnerships help manage cash risk better as often you only pay margin to partners once the sale has occurred (e.g. if products don’t sell, costs are minimal).  As well, partnerships allow you to enter markets quickly because you are working alongside companies that have: sales expertise, influence over sales channels and existing relationships with potential customers.

However, if you go the partner route do not make the mistake of believing that the margin alone motivates partners.  Cash incentive is no substitute for an effective partner program that encompasses systems and guidance.

What are the basic components of an effective partner program?

First you need to segment your market and develop sales processes that meet each segment’s needs.  Then you select a partner that will implement those selling processes effectively and match your corporate culture.  To succeed you need to have the partners attention.  How do you do that?

• you need marketing programs with partner specific messaging geared to help them sell your product;
• you need a solid incentive scheme - show the partner how they can make money selling your product.  Many partners can turn your product into an overall solution and even bundle with other products they sell.  You need to show them the money;
• appoint a partner manager internally to provide partners with encouragement, process assistance, sales analytics and end-user data.  You need to treat them like your in-house sales force.

Now I am not suggesting you go with 100% partners.  Only use partners if you stand to gain a strategic advantage as well as cost benefits.  For most of you it will be a hybrid of direct sales and using partners.  When partners are used effectively your total cost of sales will come down and everyone likes that - inching closer to cash flow positive…

Good luck!