Summary

Consider how your partners can help you beyond just driving new revenue. Integrate partners into your strategy to achieve outcomes like reducing churn, increasing cashflow, and improving margins.

This easily applies to other goals–by using the simple framework described you can strategise how partners can help you achieve your unique, overarching goals.

Side note: I originally wrote this in 2018 and published it on my Medium. I've made some minor updates to bring the post up to speed.

Here's what we cover

Introduction

If you work in SaaS, odds are you spend the last 30 days of the year discussing, drafting and re-drafting your company goals, metrics, and hiring plan for the new year.

And if you have a channel partnerships team or reseller program you’ve probably done a similar exercise with them —set targets for net new revenue, new resellers... the regular stuff.

However, this time around I urge you to try things a bit differently. This time think about how your partners can help you drive your top goals for the year, and then incentivise them to do just that. Here’s how.

Goal: You want to improve cashflow and/or reduce churn

Having your customers paying for a year up-front is amazing. Not only does it help improve company cashflow, it also reduces the risk of churn for the first 12 months to zero.

Incentivise your partners to get their new (and existing) clients on an annual plan, either by giving them a one-time bonus for annual subscriptions or paying them their partner commission up-front when their customer pays annually.

Goal: You need to increase your gross margin

The SaaS gross margin benchmark is 80%. Anything below this will get your investors to raise questions about how you operate your post-sale team (and also hurt your runway).

Let’s say that your gross margin is dipping below where you’d ideally want it to be — it’s 60%. Maybe you have a complex product and spend a lot of time and money onboarding new customers and supporting them.

Why not start referring high touch point customers to your top resellers and cut down on all onboarding and Tier 1 support costs?

Your partner is better equipped to provide extensive support to your customers, and charge them for that service. They're also not running a tech company and keeping the high margins that come alongside it. You could even consider a 10% rev share to your partners to incentivise them further if necessary, and still markedly improve margins.

All of a sudden that 80% doesn’t seem so far away.

Adapting this for your organisation

These are just two ideas, and may not address even one or all of your annual goals. But you can still make it work. Here’s how you can break it down as a thought process:

1. List down your company’s biggest goals for this calendar year.
2. Write 2 ideas on how your resellers can help drive each goal and the incentive you can provide them.
3. Reach out to your resellers and discuss your company’s 2018 goals, and the incentives that you’re rolling out for them. They will thank you for it, and you will too.

Oh, and the last step — cross your fingers and hope everything works out.

Thanks for reading so far! If you have questions or are curious to learn more, feel free to hit me up on LinkedIn or Twitter. 👋

You can also follow me or hit subscribe to keep in touch. I write regularly about growth, marketing, and partnerships in tech and fintech.