Conflicts within a distribution channel cannot be avoided because all members of a channel want maximum benefits from their sales. Resellers, vendors and other partners in a business relationship such as this want a form of control when it comes to products and corresponding markets. In order for the distribution channel to succeed and satisfy all the members, Partner Relations Management (PRM) must be used. It provides and ultimately enhances the much needed protection vendors need to give resellers, and at the same time protect themselves from the resellers.
To better understand how partner relationship management works, here is one issue that tackles a conflict within a distribution channel regarding the sales of a software program product, as well as its corresponding solutions and enhancements using Partner Relations Management:
The situation is that the product for sale is so consumer-oriented that it bypasses the need for additional services/support that adds on to the sale and thus eliminates the need for an offline sales force.
For example, a small developer comes up with a software program in English. Small developers rarely have the time and resources to translate a software program in many languages, and often times end up not doing it all. This is when resellers can now come in to play. Armed with the time and resources to translate these programs, resellers can offer these products in a customer’s native language by translating the program themselves. The vendors can then contribute to the process and sell these translated products online, and at the same time indicate that these product versions can be acquired from the reseller. To take it even further, the resellers can localize the website selling the translated programs, and offer customer product support. Being able to provide first level support reduces the stress of the program publisher lets the reseller negotiate better prices.
The solution, therefore to this situation is to localize products or websites and offer product support. In applying PRM, the solution can be enhanced by offering different prices for the translated versions of the authored program. Cater to different customers by allowing sales in local currencies and put a margin on the offered product support.
At the end of the day, resellers and vendors must keep in mind that a successful channel strategy depends on the customer buying process. For the vendors, they must see to it that they keep their business strategies and objectives in line with what’s ‘hot’ or what sells in the market. And to ensure a good relationship with partners, particularly resellers, vendors must always remember that resellers are their dependable business partners who will probably stick around for a good, long while. Resellers, on the other hand, must determine the best tactics or strategies in selling the products from the vendors in order to be considered a strong link in the distribution chain.
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