How to Pick and Play Nice with Your Cloud Vendors

Most solution providers realize that the success of their cloud practices relies heavily on their willingness to reinvest—to pour money back into the business. As that reinvestment increases, other key facets of a partner’s cloud business grow as well. One of those .. Continue

Company & Partnership News
Growth & Best Practices

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Written by
Tim Fitzgerald

Most solution providers realize that the success of their cloud practices relies heavily on their willingness to reinvest—to pour money back into the business. As that reinvestment increases, other key facets of a partner’s cloud business grow as well. One of those is the roster of vendors that solution providers team up with to bring solutions to market.

As it turns out, inviting more vendors into the fold should be a top priority for solution providers and something that will come naturally as partners look to expand their cloud portfolios.

Among respondents to the 2018 U.S. State of the Cloud study (a joint effort by The 2112 Group, Ingram Micro Cloud and Microsoft), the median number of vendor partners was only three—the same as the median number of products sold per cloud engagement. Both figures need to increase for solution providers to achieve long-term profitability.

Of course, expanding the roster of vendor partners presents challenges and increases complexity. How many vendors do we add to our list? What criteria do we use for selecting them? How do we handle the widening net of relationships? For answers, start with these helpful tips for vendor selection and management:

Don’t get stuck on the numbers

Just as vendors shouldn’t get caught up in the number of partners they recruit to their channel programs, solution providers shouldn’t put too much emphasis on achieving a set volume of vendors in their portfolios.

Whether a partner works with six, eight or 12 vendors is of little consequence as long as those relationships are fruitful and complementary. As with most things, it comes down to balance: Partners should engage with enough vendors to offer a well-rounded, balanced line card, but not so many that relationship management becomes an issue.

Re-assess your selection criteria

As in the days of legacy sales, a vendor’s product features and performance as well as its technical support seem to carry a disproportionate amount of weight for partners looking to choose cloud vendors. In the 2018 cloud study, features and support got top billing from 56% and 44% of solution providers, respectively. Product performance was selected as the main criterion by 40%.

Undoubtedly, the functionality and reliability of a vendor’s solutions are critical, but partners looking to build recurring revenue in the cloud should consider other factors. This is especially true given the importance today of spinning up one’s own branded, go-to-market cloud solutions.

The criteria include market demand (to what extent end users are clamoring for a vendor’s cloud solutions), extensibility (how open a vendor’s platform is and the interoperability of its products with others) and a technology roadmap (a vendor’s shared plans and insights for developing and expanding its service offerings).

Though top-of-mind for only 20% to 25% of cloud survey respondents, these are important considerations for partners seeking to plug the best vendor resources into homegrown cloud portfolios.

Maintain open communication

In today’s highly competitive marketplace, engaging regularly with vendors can mean the difference between just squeaking by and running a profitable practice. In yesteryear’s world of one-off legacy transactions, keeping vendors on the periphery might have worked, but doing so today can spell trouble in the form of missed resources, poor planning and, ultimately, declining profits.

Smart cloud partners know they need to stay on vendors’ radars consistently. Those that make their needs known—and can show they’re valuable contributors to a vendor’s bottom line—stand a better chance of getting training, enablement tools, support and other resources that can bolster their cloud businesses.

In addition, staying in touch doesn’t just mean conversing; it’s also about ensuring alignment of goals and expectations through joint business planning, co-marketing and annual (or semi-annual) business reviews.

Don’t be a jack-of-all-trades and master of none

Cloud can help businesses of every size and stripe reduce costs and achieve agility; end customers don’t have to be in any particular vertical market to benefit. As for partners, specialization can be highly advantageous, allowing them to create solutions that dovetail with and add value to vendor offerings.

Also, partners with specialized expertise in vertical markets or technical domains can wrap customized services around those solutions, work closely with vendors to deliver specific business outcomes, and avoid competing with every Tom, Dick and Harry in the cloud channel.

Ready to see where your business stands?

Try the 2112 Cloud Altimeter—a cloud assessment tool exclusively for Ingram Micro partners. By answering a few questions about your company and its cloud practice, this tool will generate a comprehensive report on how your company stacks up to others in the same class. To learn more, visit the 2112 Group Cloud Altimeter.