Having been in IT VAR space for many years, I prefer this model. I DO NOT like certain camera vendors that only give next tier project pricing. I don't believe that some Platinum partner that has done NOTHING in a deal should be able to come in and beat me just because they are a platinum partner. I believe any deal I work is mine - and some large integrator shouldn't be able to swoop me (athough we all know the large integrators will just blow the install anyway).
If some large integrator (which presumably also has larger overhead) can vastly undercut you, then you may be charging too much (as compared to "the market"). Typically the delta between large and small integrators is 20 points or so. Yes, that's a lot, but the hardware is only part of the job.
The other aspect is the product itself and who is introducing it to the customer, not just who is the first person to quote the job. If another partner has done NOTHING, yet the customer chooses them to install the system, what does that say about their confidence in YOU?
Don't take these questions the wrong way. It's hard, as a manufacturer, to come up with an ideal strategy (though, for the record, I don't think Arecont's approach is ideal). One general approach is to reward overall loyalty/total sales with the Partner Program method. The other is a more free-for-all first to stake claim approach.
When I have seen competitive integrators on a deal, the winner or loser is generally not determined by a 5 or 10 point discount spread from the manufactuer (or really, manufacturerS since few jobs involve only 1 company), but from the aspect of the integrator truly owning the mindshre from the customer.
I'm generally more of a fan of the Partner Program approach, and I was in past lives where I was an integrator or distributor of products. I like to know where I stand on pricing BEFORE I go into a meeting, and I like to know what it takes to get to the next level (and conversely, roughly where my competition as an integrator is priced at as well).
...some Platinum partner that has done NOTHING in a deal should be able to come in and beat me just because they are a platinum partner.
How do they "come in" exactly? Are you suggesting that the manufacturer alerts the preferred partner to the existence of "your" deal, based on information you supplied to the manufacturer, (for pricing perhaps).
If so, that's definitely reprehensible!
Do you also mean if they "come in" to the deal thru their own sales effort, and simply quote based on their lower cost? And only if they 'come-in' right at the end?
Do you refuse to 'come in' late to a deal and quote over a lowered tiered competitor?
The bulk of what I do is government, so if you take (as an example) a deal with 500 ip cameras, a large integrator (Unnamed AX-- Manufacturer) could win just because their hardware costs are lower.
In these cases it makes no difference who the customer wants to work with, it is just lowest cost. We all know that they will regret working with unnamed SieXXXX or JXX or AXX integrators because they actually have no clue what they doing, but that is often learned after award.
I clean up a LOT of unnamed large integrator projects, but their buying power exceeds mine.
Your expectations are really kind of unreasonable.
From your posts, you're trying to build a business by going after customers (government) that are highly price motivated, and you go into this knowing you're at a disadvantage relative to your competition. That doesn't seem practical to me.
Then you go on to say:
I clean up a LOT of unnamed large integrator projects, but their buying power exceeds mine.
This seems like where your competitive advantage lies. Stop bidding on deals you have low probability of winning and concentrate on situations like this where you can charge a premium and have less competition.
For the record, I did not mention any of those names, and any legal team members from any of said integrators are hereby notified that I did not necessarily mean any of said integrators in any post I may or may not have made.
Furthermore any post I may or may not have made on IPVM is not specific to any particular integrator or manufacturer. All events, characters, and depictions in any post I may or not have made are purely ficticious and do not represent any actual integrator or manufacturer currently living or dead.
No, but I am flattered that you are even asking. As you are (painfully) aware, my security industry knowledge is only a subset of that contained within IXXX, (a certain independent testing site that you might be familiar with. ;)
Seriously, JXX don't get much buzz around here, though looking at their numbers they are easily in the top 5 integrators, (I think). I assume that the reason is simple; that they are non-innovative, yet non-controversial, behemoth.
All partner programs that deal with tiered pricing do is make a huge mess. Companies with huge discounts will sell on Amazon or ebay and then other partners will buy cross channel while saving money over distribution. The idea of protection brand value and reseller loyalty is a sham at best.
On a side note though, I have always thought project registration was illegal when used for any kind of state or federal project. Its basically telling the first company to register that as long as you bid at the cost the other companies pay in hardware then they cant undercut you and is in effect rigging the bid.
For the Most part many manufacturers have no clue on how to run an effective sales channel, and if i had the backing I am sure I could rake in the $$ doing channel consulting. I see blantant illegal programs, ones designed to punish authorized dealers more then unauthorized, and the list goes on.
Only way to have a partner program is to segment by type of reseller, comrehensive MDF and marketing programs to support dealers and customers, detailed POS reporting, and a fairly balanced omnichannel approach if taken.
Sales managers at these companies should not be designing the programs. I have seen companies doing multimillion in sales yearly trusting their channels to people I wouldnt trust watching my 4 year old.
We have a partner program that utilizes the project registration discounts. It works very well for us. The amount of discount or percentage is based on the partners level in the program. We also protect the integrator for 90 days so another integrator does not come and steal the business away. This works very well for us and we have a lot of loyal dealers who like the program There is a caveat though all projects must a meet a minimum 15k dollar amount in order to qualify for a project registration The amount is based on distributor pricing since all project pricing gets passed thru our distribution channel
My argument is that unnamed anonymous manufacturer Ax-- should not simply give tier discounts.
If you truly valued ALL of your partners, a deal registration would be a fixed percentage ABOVE highest tier partner level. Otherwise, I simply work with someone else. This is a complaint I have had about anonymous unnamed manufacturer Ax-- for many years.
BTW, your large integrators are doing you no favors...
I really do not feel those types of programs are good for the industry. Protecting a dealer who may not be the best fit, best qualified,and may not be the customers choice seems to harm the market. Though many want to deny it, any business becomes a commodity at some point and profits fall, that is what drives innovation. Anything that works to preserve the "old ways" only makes the opportunity for market disruption to happen. The security industry is in a profitd ecline for both cctv and physical security as it becomes easier for end users to diy, internal company staffs do installs, and prices drop. It happened in IT and many markets before it. We have a healthy business and serve customers nationwide, do remote installs, hardware sales and I am sure steal projects away from local companies. We just do it very well, know the products we use, and have a business model that is much more effecient then many traditional companies. Its not a wrong model, its just one of the new ways you have to do business to succeed.
I am biased because I represent Arecont, however I would like to point out a couple quick things.
1. The deal registration is typically much more than 5%. (as stated in the story) Depending on the opportunity, effort and communication with the Integrator/Distributor and Arecont the enhanced pricing can be very significant.
2. The first one to respond to a tender does not always get the registration! No registration is offered without the regional rep and regional sales manager being consulted. In fact most registrations are done long before a job hits the street because the integrator and regional Arecont sales staff have been working in conjunction. Done in this fashion the support and registration are significant.
I know Arecont's system is not perfect, but the intention is to truly reward the integrator and/or distributor who does the product positioning work. This typically drives good two way support and communication with the local rep, creating a great partnership....and in the end that is what matters.
Btw, in terms of discounts, that's why I said, "standard discounts of up to 5 points apply." From my knowledge, that's the 'standard', listed discounts. As you say, I am sure one can make individual deals of 10%, 15%, etc.
Errrr, let's not pretend that project registration for special pricing is something Arecont came up with. Almost every manufacturer, including the ones who have partner programs, also have project registration pricing.
12 years ago at GE Security we had discounts for project registration, discounts for using multiple components of the offer (System Discount), and then tiered value-adds and rebates for higher volume partners. Literally every company in this space I've worked for has had some sort of combined program for partners and project registration.
Arecont didn't invent anything new with project registration, and doing discounts for such isn't a "this or that" pricing strategy as their response may imply.
However, what a partner program does require is internal resources to manage it. It requires a solid team of marketing and sales leadership to plan, implement, police and reinforce a partner program. If Arecont chooses not to use their resources for such programs (or lacks the resources to do so) then doing a partner program for them is probably not a good idea, and project registration would be the far simpler approach.
The point is not that Arecont does project registration. Is that they do not do dealer volume discounts. I've updated the post to make it clear to anyone that thinks that Arecont is unique in offering project registration.
The point I was making was, the response from Arecont makes it sound like Project Registration is their answer to volume discounts, when in fact you can have both Project Registration AND volume discount programs in place. I added a little color by adding my observation that Arecont's video statement paints a picture that Arecont has innovated in some regard by offering Project Registration.
I was not at all unclear on the information you were presenting. Sorry if my sarcasm came off as me not properly understanding your intentions.
And this is how a true partner program should work. I have been a Cisco dealer for nearly a decade, and when I get a registration discount with Cisco I know that my competition won't win just on price despite having done no work on the deal.
You can all argue that X partner may not be the best fit, etc. etc. etc., but if I am the one that introduces a technology to a customer, designs a solution, and puts a lot of effort into a deal no other deal should be able to win because some manufacturer has decided to give that dealer a bigger discount.
Say what you want, but if you have contributed nothing - you deserve nothing.