The Ying and Yang of Security
Consider the vendor/reseller partnership to meet the needs of security managers
- By Alan Fontanella, Jeff Sharpe
- Jun 01, 2022
How do you bring the best-fit product, at the best price, in the best timeframe to security customers? For some security vendors, working through a value-added reseller network is the best answer. And though resellers and manufacturers collaborate naturally to offer solutions that meet the needs of security managers, the relationship is not without some inherent tension. But strong relationships between vendors and dealers inevitably benefit both parties – and end users.
Security Today talks to both sides – an ID card printer vendor and a security products reseller.
Q. Explain the dynamics of a vendor/reseller relationship. How do you interact?
Alan Fontanella. As we’re building a relationship with a reseller, we have regular contact in the form of sales training, tech training and marketing support. Those things continue as the partnership progresses. On a daily basis, we’re in contact to support our resellers who are working with their customers regarding product questions, product availability or pricing.
Jeff Sharpe. We’re on the phone every day with our vendors. Do they have inventory, what are the shipping timelines, how do we integrate their product into a unique application? Quick response time is critical. Amazon changed the way the world works – everything is right now and everything is at the lowest price.
Q. What’s the profile of an ideal reseller or vendor partner?
JS. Before a relationship between a reseller and a vendor begins, there are promises made on both sides. The vendor promises to support the reseller. The reseller promises to sell, market and support the product. Here’s what we look for in a vendor:
- Do they have inventory available? Customers don’t want to wait for an overseas shipment once they’ve accepted a bid.
- Do they offer competitive pricing? Unique features are important, but if they come at a price the market won’t accept, they’re useless.
- How robust is their tech support? Regardless of the vendor, once in a while, you’ll sell a printer that breaks in the first 30 days. The expectation is that the printer will be shipped back to the vendor at their cost and replaced with a new one free of charge. The vendor must own that. The customer can’t be without their printer while it’s being serviced. If there’s any problem, it’s ‘here’s your money back or here’s a new one.’
- Modern digital marketing. Vendors who best support resellers provide digital assets like cut sheets, videos, images, email templates, web copy. They need a robust website and brand-building activities. It’s best when we’re working with a customer who has heard of the brand we’re proposing. We also like when a vendor provides pre-written proposals, where we just add the client’s name and a few tweaks. We need whatever makes us successful presenting their product to the market.
On top of all this, a vendor needs to demonstrate a track record of success. Will they be around for a long time? We can’t take on a new line without knowing that it will be supported for years to come. Our customer relationships are all we have – we need to know the longevity of the suppliers we work with to make sure our customers will be taken care of.
AF. We look to identify the merits of a reseller that will lend themselves to be successful with us. It’s not a surprise that we want resellers who have a proven history of success in our market. Coming from the perspective of an ID card printer vendor, does the reseller have experience selling and maintaining card printing systems? Do they have complementary products that provide a complete solution for the customer? These are our ultimate markers.
Our resellers represent our brand, so it’s important that they have modern sales and marketing capabilities – a solid web presence and other customer-outreach techniques.
We look for resellers who seek to separate themselves from the pack with market-based, differentiated solutions. Ideally, resellers who focus deeply on vertical markets become customer experts in those fields. Those are attractive prospects for our distribution network. They have a thorough understanding of the pain points of those customers and can recommend a solution that fits.
It's a given that a strong service program is in place. We provide a hot-swap program and conduct annual tech support training. We need to make sure our resellers have the bandwidth to accommodate any service needs of their customers because our brand reputation depends on it.
There is some level of rigor in finding the right match of resellers and vendors. The chemistry and vision of the two parties need to be aligned. We ask, ‘How many different vendors are you selling? Is there room for us? How do you see the fit of our products in your portfolio?
Q. How do exclusive territories play into a vendor/reseller relationship?
AF. In the 2020s, geographic territories are not practical. The internet has made the United States an open territory. Everyone can ship everywhere. In terms of vertical markets, yes, territories are in view. If we find a specialist reseller in the outdoor sports market, for example, that could be exclusive. Their expertise makes the vertical market exclusivity a fit.
JS. Yes to territories. If I’m going to spend time and money marketing a vendor’s product, I want to make sure those dollars come back to me in the form of leads and new business. Geographic territories make sense in a small market like Canada. (Jeff is based in Ontario.) We provide vendors with a great deal of sales for that exclusively.
Q. Has the reseller/vendor relationship changed in the last few years?
JS. The pandemic and supply chain issues have played a big part in changing the relationship. We talked earlier about the promises made by resellers and vendors. Vendors broke their promise to supply products when we need them. I’m not saying this was their fault, but this caused us to break promises to our customers. We couldn’t support the printers we sold because the vendors couldn’t supply the media (ribbons and cards.) It’s hard to re-establish that trust.
AF. As we’re building our business, we’re focused on reseller profitability. We know we will not be successful unless our resellers are profitable – and at a profit level beyond what they get from other vendors. It’s a primary priority of ours. As ID card printers become more and more ubiquitous, there is less loyalty in the distribution channel. That’s not a good or bad thing, it’s just what it is. Essentially the ID card market is becoming like a grocery store – just pick the brand you like and put it in a cart. So, our focus on reseller profitability becomes even more important.
Q. How does the dynamic of a vendor selling direct to customers AND selling through resellers play out? Is it an inevitable conflict or can they work in concert together?
AF. There is a place for both channels. In North America, 65% of printer sales use old technology. The older technology is a good fit for eCommerce. There’s little innovation, so it becomes somewhat commoditized. With higher technologies and innovation, resellers who have one-to-one relationships with customers have a distinct advantage. The more complex the installation, the more value the reseller adds.
JS. It is an inevitable conflict. I never sell a product that’s also sold directly from the manufacturer to the customer. Resellers can’t win in that scenario. If the vendor has a second product line that’s clearly distinct from the one we sell, that’s different.
Q. What else goes into building a strong distribution network?
AF. There’s a balance between finding the right number of resellers to provide broad coverage in the market, and providing a strong profit opportunity to each partner. For us, dealer profits matter most. That’s where our mojo comes from. If you have 100 resellers all offering the same printer solution on a particular bid, closing the sale becomes a matter of price. That doesn’t serve our resellers well. If we can stay competitive on price while adding unique, sought-after features, we’ve got an opportunity resellers look for.
JS. As a reseller, you have to have the capital for inventory, plus sales, marketing and service. There’s no point in being a reseller if you can’t support the vendor you’re dancing with. And you can’t dance with everyone. Capital is king in this marketplace. You have to have the money to stand behind your offering. There’s no more just-in-time purchasing. And it probably won’t come back.
Q. What is your future outlook?
JS. A few years ago, we went back to school for digital marketing management. We literally went to the University of Toronto for training in a foundational course about everything digital. We are competing in a world that sees Amazon as the gold standard for distributing products. We need to play at their level. So, we made some shifts, and it’s paid off.
AF. I will reiterate that reseller profitability is our present and our future. Nothing matters until someone sells something, and we need to focus on keeping our resellers happy and productive. That’s the whole ball game.
This article originally appeared in the May / June 2022 issue of Security Today.