Wanted: Healthy, Channel-Centric Vendors

In the years I've spent writing about technology, I've given a fair amount of attention to discussing what vendors look for in their VAR partners. But what about the flip side of the coin?What makes a vendor a good prospect for a solution provider? More specifically, what makes a vendor a good prospect for an SMB VAR trying to navigate today's ultra-competitive environment?

Of course, every solution provider is unique, but a few common threads have emerged from my recent conversations with channel players.

Viability. VARs want to know that they're not teaming up with a "fly by night" company, and understandably so. "It's vital to get a sense of a potential partner's financial stability and growth in their market," says Greg Schaller of Trifecta Technologies, a provider of e-commerce solutions. "Also key is doing a competitive market analysis to understand where the partner stands in terms of product features, capabilities, and market penetration."

Adds Harry Segal, president of Networks Unlimited, a Hudson, Mass.-based security VAR: "We look for vendors that have demonstrated they have the resources, commitment, and vision to continue producing and supporting a competitive product offering. We want the vendor's products to be something we'll be marketing for a minimum of three years, but preferably five or more."

Segal also says he's especially careful about forming partnerships with start-ups or companies that may be acquired. "We avoid those that have yet to establish a meaningful customer base, those without substantial funding, and those with senior management that lacks a solid track record. … I also try to gauge the likelihood of a potential vendor being acquired in the next few years, because that generally spells bad news for their technology, channel program, and the relationships we've developed with key personnel."

Channel-Friendliness. This may seem like a no-brainer, but it's not just about the vendor acknowledging the importance of the channel and having a decent partner program in place. The vendor has to be responsive; it has to boast impressive channel resources; and it has to put channel partners at the top of its priority list.

"Are they willing to support our sales efforts with webinars, online customer demos, and evaluation units, or is the onus on us to perform demos, purchase NFR units, and deliver webinars without a quality speaker from the vendor?," asks Segal. "As part of our due diligence in selecting a vendor, we perform a hands-on evaluation of the vendor's product or service. While those evaluations involve speaking with existing customers that use the vendor's offering, we don't consider this an adequate replacement for a hands-on assessment of how the product works."

Jim Bartow of Enterprise Business Network, whose portfolio includes CRM solutions, takes a lot of factors into consideration when determining whether or not a vendor would be a good match for his company. "Will they respect our relationship with our clients? Do they show good faith in minimizing channel conflict? Do we have access to higher-tier support, or do we have to 'maneuver through the maze' of support levels and hold times? Can we trust the vendor?

Company Structure and Culture. Sometimes you have to look at the big picture, too. Otherwise, you may not see the forest for the trees. Trifecta's Schaller says he takes an organization's structure, skill sets, depth of experience, and culture into consideration before engaging it as a business partner. "For us, it's important to understand their current client capacity and their ability to take on more work," he says. "Also, how does this vendor fit with our organization? Will it complement us and add value? Will this be a truly synergistic partnership?"

Now, those are by no means the only considerations, but they're some of the most important ones mentioned by solution providers.

Stay tuned for part 2, when I discuss a few other criteria, plus what VARs look for in a vendor's reseller program.