As a titan of industry ― or, as you might prefer, a business owner ― you undoubtedly have relationships with more than a few resellers. The tech industry in particular does the vast majority of its business through resellers who convey products and services directly to clients. The system works: Tech producers make their tech available without sinking resources into sales departments, resellers get opportunities to break into otherwise inaccessible markets, and you get superior products and services at excellent prices. Yet, there are many aspects of the reselling industry that you probably don’t fully understand ― especially deal registration.
Registration programs are common in reselling, but to clients and customers, the process is confusing at best and threatening at worst. However, there are economic benefits to encourage the deal registration process ― though it might not be a perfect system as yet. This guide will help you learn the ins and outs of deal registration, so you will be in-the-know the next time you contact your reseller.
Deal Registration Defined
To understand deal registration, you might want to learn first about reselling. Tech reselling is a world unto itself, and few people outside the industry know exactly how it works. Essentially, tech manufacturers ― who tend to be big names in tech like Cisco and Adobe but also include startup tech developers ― hand off sales operations to third parties. Sales is a complex task that requires intimate knowledge of regional markets. Worse, sales often requires other time, energy-, and resource-expensive departments like marketing and customer service. Thus, to provide better service to customers (and to devote more budget to developing better tech) most manufacturers outsource sales to resellers.
Resellers come in many shapes and colors. Retailers, like Best Buy, are theoretically included under the umbrella of the reselling industry, but most businesses partner with specific B2B resellers that operate in a unique manner. Among these are value-added resellers, or VARs, who bundle tech products and services together to provide more tempting options. You might also hear the term “channel partner,” which is a reseller who has a relationship with a particular manufacturer or vendor and can offer only products of a single brand. Resellers are much smaller than tech manufacturers or vendors, and they operate within a strict regional boundary. Still, there might be many resellers operating within a particular region, which is where the importance of deal registration begins.
When any salesperson gains a lead on a sale, his biggest fear is that he will lose that sale to the competition. This is true in reselling as well, except in many cases resellers are channel partners with the same manufacturer, making the competition even more devastating. To cut down on the possibility of channel partners undermining each other’s sales, many vendors require their resellers to secure deal registration agreements. Once a potential deal is registered, other reseller partners are unable to interfere, else they risk their relationship with the vendor. In effect, resellers register their deals to call “dibs” on certain clients.
The Benefits of the Deal
Most importantly, deal registration allows resellers to maintain exclusive control over certain leads, which reduces competition and conflict among companies that are effectively on the same team. As the customer, you get better service when competition is no longer an option. For comparison, you might recall the confusion and frustration of buying a car, since there is no such registration amongst different dealerships or even different salesmen. Without the urgency of sealing a deal quickly, resellers can work to give you a calm, comforting experience as well as the best possible deal.
Resellers benefit in a number of other ways, as well. Some vendors provide incentives for resellers to register their deals; for example, Cisco’s OIP offers partners a number of opportunities to improve sales margins when they win opportunities in particular markets. Additionally, through registration, vendors can keep closer tabs on their resellers and provide assistance when certain partners are lagging behind. This allows the entire reselling system to stay healthy and helpful to everyone involved.
Deal Registration Downsides
Still, the system does have some weaknesses. Most notably, only about 30 percent of deals are actually registered, which means the vast majority of deals can be undercut and sabotaged by competition. The primary reason participation is so low is that registration is another step in the long process of making a sale, and the more time a deal takes, the more time and opportunity customers have to change their mind. Sometimes, deals take several days to receive approval from vendors, during which time you might rethink your tech purchase and decide against it.
Additionally, though it is rare, deals can be denied after resellers attempt to register them. The risk of putting effort into a deal only to learn that a potential client has a relationship with another channel partner is not worthwhile to most resellers, who would prefer to close and profit rather than uphold the system. Still, a few experts believe in deal registration enough to offer valid solutions.
In theory, deal registration could be an invaluable strategy for reselling tech, which means the reselling industry must do what it can to make registration a reality for more deals. According to Steve Murphy of VARtopia, the main problem is a widespread misunderstanding of registration. He believes resellers should register their deals as soon as they identify leads, not just before closing sales, as many do. By registering as early as possible, resellers will experience less stress in any verification delay, and they won’t waste time and resources with invalid clients.
Additionally, vendors should work to streamline their registration processes and better advertise any incentives they give to resellers who participate. Murphy suggests allowing resellers to manage the registration process completely, so they can identify issues and resolve delays as quickly as necessary. Including such a tool available within partner portals ― perhaps even integrating that tool with existing customer relationship management (CRM) software ― would be a significant step toward vendor transparency that builds reseller trust in the deal registration system.
Deal Registration Advice
Every sale requires a relationship, but when you buy your tech from a reseller, you become a member of a wide net of customers, resellers, and vendors. Whenever you do business with your tech provider, you should inquire about their registration program and encourage them to participate. Ultimately, better service and lower prices are what you can expect from deal registration programs, so you can only benefit by working with a participating partner.