Managing Competition From OEMs

For many organizations and OEMs, channel partnerships offer an effective, sustainable, and powerful means for growing their businesses. From value-added resellers to system integrators, and affiliate partners to managed services providers, the benefits of working within the framework of channel partnership can help create a successful trajectory for their organization.

With that said, many OEMs are starting to explore how they can take functions previously deployed to channel partners in-house to increase revenue, grow margins, and pad their bottom lines. For many companies, leveraging a hybrid approach—some services are held in-house and others are pushed to channel partners—is becoming commonplace. Here are some ways channel partners can stay ahead in the face of competition from the vendors themselves.

Expertise Talks

Channel partnership is not about product offerings but service for many organizations. The MSP Day Report by Barracuda found that 59% of survey respondents said that services would account for 50% or more of their revenue. As a channel partner, deep expertise and the ability to provide outstanding service levels can be the difference between winning and losing in today’s marketplace. Look for opportunities to narrow your focus, develop expertise, and provide outstanding service for your customers.

Howdy, Partner

It’s no secret that information technology is big business—in fact, it’s a $7 trillion business. But for many organizations in the IT space, a sizable chunk of revenue comes through partner-assisted revenue—in other words, channel partners. Just look at Microsoft, which has 90% of its revenue flowing through channel partners. With more SaaS organizations entering the marketplace every day, the opportunity to create new partnerships is significant. As a channel partner, diversifying into new partnerships is a must and can help you stay viable in the long term.

Focus on Areas of Growth

While, as mentioned, expertise is essential, channel partners must also be strategic and intentional about staying ahead of trends and looking for opportunities to capitalize on the market’s movement. Today, digital transformation is aggressively changing how organizations of all sizes and verticals conduct business, meet customer expectations, and manage their teams. According to the International Monetary Fund (IMF), 65% of the world’s GDP will be digitized by the end of 2022. At the same time, the workforce is becoming increasingly remote, and opportunities to support a more digital and dispersed workforce are many.

For channel partners, this signifies a great opportunity to support this rapidly changing environment. From providing services and solutions for remote workers to ensuring data privacy, security, and compliance, a volatile environment can mean one where companies are looking for support and expertise to deal with change. This is a place where channel partners can thrive.

Competition is certainly not always a bad thing. In the case of increased competition from OEMs and SaaS organizations, channel partners need to adapt and be more strategic about the services and support they offer. With the right approach and focus, 2022 can be a year of remarkable growth.