Independence in the Reseller Channel
Interesting article in CRN this week ("Infor Enforces Exclusivity", 9/18/2006, www.crn.com) about how Infor has set a deadline of December 1 for partners to be exclusive to Infor or leave the fold.
Infor, which has acquired a number of firms recently (i.e., MAPICS, Formation, DataStream, Geac, SSA Global, Extensity and Systems Union), certainly has some interesting statistics behind it now. They claim 70,000 business customers and a host of legacy products (e.g., Baan) providing maintenance revenues to the company.
Any of the affected partners may want to examine the following before deciding the exclusivity matter:
- Will a marketplace that continues to consolidate be a space where independence is valued by your customers? Between Infor, Oracle and Microsoft, a substantial number of application software vendors are now part of one of these firms. SAP is still growing and that means that with customers seeking solutions from fewer suppliers, can you really afford to be independent?
- Customers continue to expect deeper levels of product expertise. If you spread your resources over multiple vendors' solutions are you getting too thin to remain market relevant and credible? Can you even support all of the existing solution sets of the big consolidators? Can you also support their re-designed SOA compliant new solutions, too? Discerning customers today want deep, really deep, product expertise and if you can assure them that your entire bench is focused on only one product, that may assuage their concerns.
- Can you make a better living providing conversion services to acquired product customers? Some consolidators may not be able to provide newer solutions in a time frame consistent with customer needs. They'll need a solution other than what the consolidator offers. An independent reseller may have an advantage.
- Competition for mid-market services work is heating up. Big integrators, offshore firms and others are all vying for these software projects. These bigger competitors will surely emphasize the size and depth of their focused practice units when going after this work. How will you compete against this? Being a generalist or a reseller with no specialization is not a viable strategy.
Infor's move may be a good thing for software resellers and implementers as it will doubtlessly provoke new strategy discussions in these firms. Is your go-to-market strategy in need of a review?