Selecting your Channel Members: Best Practices

After determining what the objectives of the channel sales strategy are and which channels are the best fit with your company, an understanding of which groups and companies to ally yourself with is a must. Often times, a quick survey of the industry scene would divulge which groups are the appropriate ones for your business since not every channel group can properly match the setting of your company.

Choosing the right channel members would require some work. A simple way of determining which companies are appropriate for the business is by considering three factors: their operation, their sales or marketing and their strategic fit.

The Operational traits
The business or operational functions of the candidate company should always compliment your own channel sales strategy. Your company should use this trait as a way to examine how the potential channel member will do its nonsales activities like manufacturing, invoicing, finance, inventory processes and shipping. This will also help you understand their other innate characteristics as a company such as their reputation, service levels, financial strength, process efficiency and as well as their estimated cost of operations.

The image or reputation should have to suit the type of operation your company is in. Does your company need distributors that will drive the volume of the merchandises? Or do you need resellers which will enhance the product? You chose. Considering their efficiency, their financial strengths and their expenditures will also be in question. Do they have the right amount of resources? How effective are they if they are going to be members? Will they meet the company's target cost?

Sales Traits
The sales traits are used to examine if the company in question can handle the marketing requirements of your company. The stronger the advertising force, the better. However, this may also mean that it will cost you more. So striking a balance between strong and weak advertising is important in this situation. Regardless, your company should consider the potential partners sales traits like their coverage, compensation, advertising, sales competence and product enhancement.

The reach or the coverage should explain how far geographically can they go and which market segment they offer service to. Compensation should explain the pricing, the discounts and other incentives of the company. The advertising power should also be considered. Are they already known in the market? Sales competence should be visible enough. Are their representatives capable enough to market your merchandise properly? What kind of training do they undergo? And lastly, knowing if they have an added service to the product should be recognized since it may do the product good.

Strategic traits
Simply put, the level of commitment, the shared strategic plan, collaboration, allocated resources and common goals are the strategic fit of the company. These traits should match your company well since these characteristics will fuel the drive of your plans to where you expect it to go.

The level of commitment should be same. Whatever kind of business relationship you choose; there should be a mutual understanding to avoid unfair situations. How willing is this member to allocate its resources? Are they willing to work side by side or do they opt for a outside relationship? Do their goals coincide with ours? These questions should be answered carefully as conflict may arise from improper examination of the strategic traits.