Survey: Vendors, Partners Highly Satisfied With Distribution

A study by Channelnomics and the Global Technology Distribution Council (GTDC) found vendors and partners are highly reliant on distributors in reaching and servicing the addressable market.

By Larry Walsh

In the ever-evolving landscape of channel go-to-market strategies, the role and value of distributors often become a topic of debate among vendors. Despite some skepticism regarding their productivity and investment in go-to-market relationships, a study conducted by Channelnomics in collaboration with the Global Technology Distribution Council (GTDC) highlights the indispensable role of distributors.

The study, encompassing nearly 500 vendors and solution providers across North America and Europe, reveals a robust level of satisfaction and effectiveness associated with distribution.

Vendors and partners agree that distribution plays an effective role in aligning with and contributing to their strategic plans and objectives. Among the surveyed partners, 89% reported satisfaction with the contribution of distributors to their strategic goals. Similarly, 75% of the vendors expressed satisfaction with the strategic alignment provided by distribution.

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This high degree of satisfaction with the roles and functions of distributors is further underscored by the Net Promoter Scores (NPSes) assigned by these groups — 39 from partners and 25 from vendors. Under the NPS methodology, positive numbers on a 100-point scale reflect the strength of business-to-business relationships.

At the annual GTDC Summit held in California, Channelnomics presented the study results and other insights on distribution to a group of vendor chief financial officers at the first-ever Distribution Finance Forum organized by Channelnomics and GTDC. The consensus among the CFOs and their channel chiefs aligned with the survey results, with forum execs acknowledging the significant and productive relationship vendors have with their distributors.

The survey highlighted that partners tend to have a deeper relationship with their distributors than vendors do. Partners generally express higher satisfaction with distribution services such as relationship management, technical training and support, credit and financing, and marketing. The higher ratings can be attributed to the greater reliance of partners on distribution resources. In contrast, vendors are more focused on their companies’ outcomes, though they do leverage distribution support and resources.

While distributors have evolved beyond their traditional functions, vendors, in particular, don’t always recognize or value these new capabilities and services. Vendors acknowledge that they’re not fully cognizant of distribution capabilities in supporting digital sales, marketing resources, sustainability programs, and business intelligence in sales.

The Channelnomics-GTDC study provides a clear indication that distributors aren’t just a part of the channel go-to-market equation; they play a crucial role. Their functions in augmenting services, deferring costs, enabling partners, and insulating against financial risks, while continuously adapting to the changing market, underscore their irreplaceable value in the distribution channel.

Larry Walsh is the CEO, chief analyst, and founder of Channelnomics. He’s an expert on the development and execution of channel programs, disruptive sales models, and growth strategies for companies worldwide. Follow him on Twitter at @lmwalsh_CN.

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