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Optimizing Scientific Distributor Partnerships

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x min read

Oct 5, 2023

Adapted from the SAMPS Webinar with Laura Haldane, Sharon Eaton, Rory Geoghegan & Judith Kee: How to Find, Manage & Get the Most out of Scientific Distributors

In today’s global business landscape, expanding your reach and distribution is vital for success. One effective strategy is establishing channel partnerships with distributors, dealers, and value-added resellers. Recently, a panel of industry experts engaged in a comprehensive discussion about managing channel partnerships effectively. In this article, we’ll delve deeper into the key takeaways from their conversation, including insights from Laura, who moderated the discussion.

Finding the Right Channel Partners

The journey to building successful channel partnerships begins with finding the right partners. Our panel of experts offers valuable insights:

  1. Competitor and Complementary Research: According to Sharon, one of the experts, “Identifying potential partners can start with a closer look at your competitors or companies offering complementary products or services. Examine their existing partnerships to gauge alignment with your business goals.”
  2. Manufacturer Websites: Rory suggests, “Manufacturer websites can be a goldmine for discovering potential partners in your industry. Many manufacturers list their partners, dealers, or distributors, making it an excellent resource for initial prospecting.”
  3. Industry Networking: Our experts recommend attending industry-specific events, trade shows, and conferences. As Judith points out, “These gatherings provide invaluable opportunities to connect with potential partners and assess their suitability for collaboration.”
  4. Leveraging Expertise: Both Sharon and Judith, industry veterans, emphasized the significance of seeking assistance from experts or consultants specializing in partner and distributor network development. Judith notes, “Their expertise can streamline the partner discovery process significantly.”

Establishing Trust through Effective Agreements

With potential partners identified, the next critical step is establishing trust through well-structured agreements. Here’s what our experts had to say:

  1. Clarity and Communication: Clear definition of roles, expectations, and responsibilities in distributor agreements is essential. Sharon emphasizes, “Effective communication is a fundamental element for building and maintaining trust.” She adds, “It’s quite tempting to spend all your time with the noisy, low-value distributors, but make sure that your best distributors are also getting your attention because helping them out a little bit can bring in a lot more than spending your time on the little ones.”
  2. Anticipating Challenges: Addressing potential challenges within the agreement is key. Rory advises, “Consider scenarios such as competitive overlap, changes in company ownership, or territorial conflicts. By preemptively defining solutions, you can navigate issues more effectively.”
  3. Managing Expectations: Judith highlights the importance of ensuring that both parties understand what to expect from the partnership. She says, “Distributors should be aware of the support, resources, and training available from the manufacturer.”
  4. Incentive Structures: To motivate distributors to achieve specific goals, consider implementing performance-based incentive models. Sharon notes, “These can include rewards or discounts tied to reaching sales targets or conducting marketing activities.”

Supporting Ongoing Success

Establishing a channel partnership isn’t a one-time effort; it requires continuous support and management. Here are strategies to ensure ongoing success:

  1. Regular Communication: Sharon emphasizes the need for consistent communication with channel partners. She advises, “To foster success, allocate time to support and engage with not only underperforming partners but also your best distributors.” Laura also highlighted the significance of effective communication during the discussion.
  2. Training and Support: Provide ongoing training to your distributors, especially when launching new products or updates. Judith highlights, “A well-informed partner can effectively market and sell your products.”
  3. In-Person Visits: Periodic in-person visits to your channel partners can strengthen relationships and provide valuable insights. Rory mentions, “Attending their sales meetings or conducting training sessions can be beneficial.”
  4. Distributor Conferences: Organizing distributor conferences where partners can share success stories and learn from each other is a powerful strategy. Laura added insights about the positive impact of distributor conferences, such as boosting morale and motivation among partners.

Managing Exits and Transitions

Addressing the possibility of transitioning from distributors to a direct sales model or even terminating agreements is crucial. Handling these situations professionally helps maintain trust. Here’s how our experts advise approaching it:

  1. Exit Strategy: Rory recommends, “Including a clear exit strategy in distributor agreements is a must. Define the conditions under which the contract can be terminated and outline how the process will be executed.”
  2. Communication: Openly communicate any plans to transition to a direct sales model. Be transparent about the reasons behind the decision, ensuring distributors understand the business perspective. Rory emphasizes, “We want to see it as a kind of a happy separation after it’s done, it’s reasonable.”
  3. Support in Transition: Facilitate a smooth transition by providing customer information, contacts, and, if necessary, support for distributor personnel who may join the new organization. Rory adds, “If they want to move over to the new organization, we won’t stand in their way either.”

Differentiating Channel Partner Types

Our experts highlight that channel partners come in various forms, each serving a distinct purpose:

  • Distributors: These partners purchase products from the manufacturer and sell them to customers.
  • Dealers: Dealers find customers for the manufacturer, but the customers buy directly from the manufacturer, with the dealer receiving a commission.
  • Value-Added Resellers (VARs): VARs offer specialized services or expertise that add value to the product, often serving niche markets.

In Conclusion

Effective channel partnerships can be a powerful growth strategy for businesses, but they require careful planning, clear communication, and ongoing support. By following the insights shared by industry experts, manufacturers can navigate the world of channel partnerships successfully, build trust with partners, and drive business growth in new markets.

Whether you’re seeking the right partners or managing existing ones, these expert perspectives provide valuable guidance for achieving channel partnership success. As you embark on your partnership journey, remember that fostering trust, maintaining open communication, and continually evaluating and improving your partnerships are the keys to building lasting and mutually beneficial relationships in the ever-evolving world of scientific distribution.

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