Should resellers provide support?

Yes, resellers can provide support – and some do it well while others do not. So how do you choose?

Go with resellers if they can provide a unique benefit that you cannot provide. That could be Korean-language support, deep knowledge of the shipbuilding field, or the ability to support a customized version of your product.

Provide support yourself if your resellers are mostly sales outfits, with little to no technical expertise. If you let them provide support they will suck you dry of resources while pocketing the support revenue. And customers won’t be happy. Not a good combination.

If you choose reseller support

1. Select resellers with the proper infrastructure for support. For instance they should have a few trained technical staff members and a tracking system.

2. Offer training to the support staff and test their competence through certification tests, formal or informal.

3. Include minimum performance standards into the contracts so that you have enforcement tools. Require a minimum number of certified support staff, set maximum escalation rates and perhaps minimum customer satisfaction ratings. 

4. Define the revenue split between the reseller and you (for the amount of second-line support and maintenance you provide.) You can either split each support contract or set a yearly fee for your services.

5. Define the policy for handling customers who prefer to get support directly from you. Setting up a competitive situation between you and your resellers is always tricky. If the reseller is providing support you probably want to stay away from its customers. 

If you choose to provide support yourself

1. Create a good support sales kit for the resellers. You can repackage materials you already use for your own sales force but remember that resellers sell many products so don’t have the time or capacity to remember lots of details. This could be a great impetus to streamline your tools, and perhaps the support offerings themselves, including pricing, for everyone. Your own sales force will thank you.

2. Pay a commission on support sales. It’s not easy to sell support so expecting the reseller to do it out of the goodness of its heart is folly.

Finally, be open to a mixed model (some resellers providing support, some not), as long as you follow the recommendations above for each category of reseller.

Delivering support through the channel

If you use resellers or distributors, in many case they will want (or need) to deliver the first level of support to your customers. Here are some tips to ensure success.

• Work out a reasonable revenue split. Revenue splits are eminently negotiable depending on how responsibilities are split between the reseller and the vendor and, naturally, their negotiation skills. Aim for a 50/50 split assuming that the reseller provides first level support and no onsite component is included.
• Track the supported customers. There needs to be some type of registration of customers (or systems) so you can audit the records.
• Define training and certification requirements for the resellers. The worst thing can could happen, both for the customers and the vendors, is that the reseller pockets the money without delivering any support to speak of. All issues go back to the vendor and the customer gets very slow service. To counter that, require resellers to maintain a certain number of trained staff members in-house. You can even define several levels of certification and tie different revenue splits to different levels, a wonderful incentive for the resellers to do more.
•  Actively manage the support relationship. Designate someone to watch over the interactions of the resellers and the support team. It should be reasonably easy to spot the resellers that are abusing the system or simply need to (re)train their staff. Ideally you should be able to audit customer satisfaction on a regular basis as well as observe the internal dealings between the reseller and support.