Distribution 101

Distribution 101- Defining the Distributor's Value and Channel Partner Development Services

What does it mean to be a Distributor?

There is often confusion about the roles of Vendors and Distributors, so it is important to understand the difference between the two. The definition and responsibilities of Vendors and Distributors can also vary depending upon the country or industry. This primer is intended to provide everyone who interacts with Distribution a common understanding of how the core Distribution business model works. The information will allow both supplying Vendors and Distributor personnel to master the detail of the business model and provide them a common language and understanding of how to work successfully together.

Who are the participants in the channel?

The Vendor

The Vendor is the original manufacturer of a product or service. Note that traditional technology manufacturers are the traditional Vendors, but with the advent of cloud services in managed services the channel now has loosened the definition of Vendor to include cloud service providers, hosting providers, managed service providers and application service providers. Vendors can sell to Distributors, also known as two-tier, to Channel Partners bypassing Distribution, known as one tier, or direct, which bypasses the entire channel and sells directly to the End User. Vendors can also be known as OEM (original equipment manufacturer) or suppliers.

?The Distributor

Historically, Distributors provide warehousing, financing and go to market capabilities. The Distributor provides value by managing the business relationship and building a high level of trust between the Vendor and the Channel Partner. The Distributor can provide account management, sales support, product expertise, logistics, order processing, reporting, financing, marketing, professional services, support, training, legal counsel, compliance oversight, market information an analysis for the Vendor and for the Channel Partner. Distributors may carry complementary and competing lines. Commonly, Distributors believe that the Distributor should not sell a product or service directly to an End User without a specific request and with the full support of the Channel Partner. This would set up an environment of competing with the Channel Partner; the Distributor's customer. There is a gray area, a service provider may be seen as an End User or a Channel Partner. They receive the product or service but then sell it through a service offering. In some product channels, Distributors are also known as Wholesalers.

?The Channel Partner

Channel Partners, a Distributors customer, are made up of resellers, value-added resellers (VAR), service providers (SP) and system integrators (SI). A VAR is a company that provides existing product(s) and service(s), adds its own value - usually in the form of a specific application - to offer to the End User - the VAR’s customer. The service provider has traditionally been the telco but has evolved to now include any provider who leads with services supplemented with associated hardware and software to deliver the service. Equipment delivered as part of this service is traditionally known as a CPE or customer premise equipment. System integrators are the traditional IT-oriented consulting services organization, which provide hardware, software and other services as part of an enterprise consulting engagement. Common IT service providers can also be known as managed service providers, managed solution providers, managed security service providers, application service provider, cloud service provider, network service provider, internet service provider, storage service provider or web service provider.

The End User

The End User is the ultimate consumer of the technology or the service. They typically acquire goods or services through the Channel Partner or the Vendor if the Vendor doesn’t have a channel program or if the Vendor choses to bypass the channel.?

?Figure 1: One-Tier and Two-Tier Distribution

How does Distribution make money?

?“Firstly, the Distributor's business model is capital intensive, driven by the need to hold stock and finance trade customer credit, less any supplier credit received. Second, the Distributor trades on thin margins, and thus needs to be a low overhead business. This is a challenging model, requiring ability to manage both profitability and asset efficiency or productivity.

…Profit is a very small number between two very big numbers”

Julian Dent - author of Distribution Channels, Understanding and Managing Channels

What is working capital?

Inventory plus Accounts Receivable less Accounts Payable.

Distributors monetize the sale through transaction gross margins, manufacturer rebates, inventory turns and return on working capital (ROWC). Distribution makes small margins on large dollar transactions themselves (revenue minus cost of goods sold) which is then largely supplemented by various market incentives that Vendors provide. In some cases, technology Distributors will lose money due to competition or over Distribution on the base transaction, if not for Vendor-based incentives.

?These incentives can take the form of product-based incentives, sales-based incentives, customer-based incentives, market development incentives and/or financial payment term-based incentives. It’s common knowledge that the Distributor typically receives the least profit from margin in the 2-tier channel.

To remain profitable, Distributors must be constantly looking at ways to enhance their offerings and optimize the cost of those offerings.

?Many Distributors offer services as a standalone provision or to augment a Vendor offering. Distributors may offer managed services, professional services and/or field services. Examples of services that may be offered by a Distributor are:

?·????????Cloud migration

·????????Local, regional or global deployment

·????????Site or network assessments

·????????Project management

·????????Installation

·????????Configuration and troubleshooting

·????????Asset tagging

·????????Consultation and training

·????????Remote monitoring

·????????Helpdesk support

·????????Bill of material or system design support

·????????Disaster recovery service and more

?Some Distribution-provided services may be at no cost to the partner and some may be no cost to the Vendor while some may have a cost to either or both Channel Partner and Vendor. The delineation is usually placed at pre-sales (services prior to the Channel Partner delivering the purchase order to the Distributor) and post-sales (services delivered after the purchase order is at the Distributor). Post-sales services are typically a higher revenue opportunity for the Distributor.

?A Distributor offering services is often seen by the Vendor and Channel Partner as a value-add or value-inclusive model, where the Channel Partner can resell the Distributors services to their customer, the End User. Sometimes, Distributors offer their services with a monthly payment option. Commonly referred to as an Op-ex model (Figure 2 below). Lastly, some Distributors can make money in co-op marketing activities, but this is not a traditional profit stream.

?Figure 2: Capital Expenses vs Operating Expenses (credit: comindware)

?A deeper dive into professional services

?The Distribution services landscape has grown exponentially over the past 5 years (2015 and on).?Distribution and logistics services providers are expected to witness an upward trend in terms of sales and revenue driven by growing demands of e-commerce companies and the need for flexible, low-cost options that drive cost savings opportunities and ensure efficient supply chain management.

?For decades, the Vendor would create the products and/or professional services and deploy (and often maintain) those products to the End User – if they utilized two-tier Distribution or Channel Partners, or not. This motion maintained a confidence in the product and its purpose, added an additional path to revenue for the Vendor and allowed a communication pathway between the product in the field and its creator. At this time, the Distributor maintained the pick, pack and ship role. See figure 4 for more details on the evolution of Distribution.

?With growth comes the need to scale. How can a company accommodate every service request while designing, building, marketing and selling their products? Along with their Channel Partners, they leverage their two-tier Partner, Distribution. There is no doubt that other factors have played a key role in Distribution professional services; the increased use of cloud environments, physical devices transforming into software devices, the rise of the remote workforce, competition and inability to serve every customer wherever they may be. Distribution stepped up to meet the challenge. Many have hired skilled internal support staff and created a network of third-party professional services companies.

?In most cases, margins are better with services as product margins are typically established by the competitive environment. The Distributor typically sets the price for the services. Many Channel Partners have also pivoted to become Service Providers supporting their End Users.

What is Distribution's role in the channel?

?Distributors are business partners. The reason you go to a Distributor is to harness their power of scale. Vendors often seek out Distributors for their channel reach, or easier access to a vast pool of Channel Partners that fit their desired profile. Distributors reduce risk and complexity for the Vendor and the Channel Partner by becoming an essential part of the Vendors marketing/sales processes, by providing the Vendor with just in time supply chain management capabilities and by being the prime source of both Reseller and End User insight. The Distributor layer is the logical place in both the value and chain roles and financial business models to support the aggregation of both physical and cloud products and services on behalf of the Manufacturer and Reseller.

?What does Distribution do for the Channel Partner?

?The average Channel Partner is not interested in setting up individual deals with dozens of manufacturers. They like working with Distributors because it provides one stop shopping: one catalog, one invoice, and one check to write. They don't want to make dozens of calls and deal with dozens of Vendors.

?Distributors can provide their Reseller and Vendor Partners with:

?·????????A deep knowledge about the local market the Distributor is serving and fully understand what challenges their customers are faced with in their everyday business lives

·????????Management of selected Vendor Reseller programs which includes creating and implementing new initiatives to generate visibility, leads and ultimately revenue

·????????The Distributor holds stock to reduce order lead time for customers

·????????A host of financing options that include 30, 45, 60, 90 or other net terms, capex (paid in full) or op-ex (payment spread out over duration) depending on credit terms and payment history

·????????Specialized team focused on providing business lead and vertical market solutions

·????????Engineering, proof of concept (also known as proof of value) and demo lab capabilities

·????????Lead generation and contact follow-up

·????????Product training for sales or technical audience

·????????Dedicated account support for quoting, forecasting and pipeline

·????????Account management which typically includes forecasting and win/loss reporting

·????????Dedicated sales representatives for specialized markets

·????????Fulfilling requests for proposals (RFP) or requests for information (RFI)

·????????Bid and proposal assistance

·????????Order processing/administration support as well as deal registration

·????????Providing point of sale (POS) data to enable activity aimed at cross-selling or upselling

·????????Market support including:

o??Business development services

o??Outbound call campaigns

o??Targeted email campaigns

o??Partner network events

o??Channel Partner, Vendor and End User events

o??Targeted webcast or in-person trainings

o??Much more

·????????Assistance with license Distribution

·????????Term or co-term support and support renewals

·????????Electronic commerce or virtual storefront (point-click-buy) capabilities

·????????Diverse services

·????????Product expertise and assistance

·????????Complex or simple configuration assistance

?The infographic below will give you a few more ideas on how a Distributor assists both the Channel Partner and the Vendor.

?Figure 3: Distributions Potential Values

How is Distribution changing?

?Distribution is being driven by pressures of increasing selling costs and the demands from users for rapid and more diverse services and infrastructure. This includes the digital transformation story; storage, cloud environments, remote workforce, rapidly evolving communication and collaboration platforms, software-defined networking, analytics, security, mobility, IoT, 5G, connectivity and the ability to diversify, streamline and digitize its own core business.

?Distributors are also adapting to the Vendor landscape as it is drastically changing with the introduction of many nontraditional Vendors that require new types of sales and Distribution models entering the market. Technology Vendors are scrambling to realign or reinvent what they do today for digital transformation, e-commerce, cloud and their professional services being offered.

?The below Distribution timeline is from Innovation Insights. It tells a comprehensive and compelling story.

?1930-1990:?Component and Systems Distribution

The first era of Distribution solved the upstream need for inventory and logistics management at scale. This extended era witnessed many types of technologies utilizing the emerging go-to-market model of Distribution.?

?1990-2018:?The Solutions Era

The second era of Distribution built upon the first phase's operational excellence by creating cross-Vendor solutions Distribution. The era augmented the first era's volume ability by building a value-based business model with technical excellence.

?2018 – 2025:?Digital Distribution

The next era of Distribution focuses on the digital realm. As the world digitizes everything, the technology necessary to support the End User’s transformation will include investments in emerging technologies of artificial intelligence/machine learning (AI/ML), Cloud/XaaS, IoT, and Security/Analytics for everything.?

?A simpler view is outlined in figure 4, below. Keep in mind that a Distributor must maintain key elements of the past while adapting to the future. The columns are cumulative.

With the heavy adoption to the cloud and the obvious need for Distribution to take a seat at the table, let’s take a moment and discuss aaS, or as a service. The acronym refers to something being presented to a customer, either internal or external, as a?service, usually in the context of cloud computing. There are hundreds of examples of aaS offerings. The most popular existing in cloud environments as detailed in Figure 5 below.

?With a cloud application, what was once in - or on - the business network (on-premise) is now in the cloud. If you don’t own the server, storage or software on the cloud environment how do you pay? If you are buying an aaS product the costs are typically on a “pay as you go” structure. Many payment options are available. The options can include instances (In simple words, a server running an application is called an instance. Think of one server as one instance), cores, RAM needed, temporary storage, throughput, users (or seat count) and the list goes on.?

?Here are some relevant examples from Wikipedia:

?Artificial intelligence as a service AIaaS

Big Data as a Service???????????????????????BDaaS

Code as a Service?????????????????????????????CaaS

Data as a Service??????????????????????????????DaaS

Database as a Service?????????????????????DBaaS

Firewall as a Service????????????????????????FWaaS

Infrastructure as a Service????????????IaaS

Identity as a Service????????????????????????IDaaS

IoT as a Service?????????????????????????????????IoTaaS

Machine Learning as a Service????MLaaS

?Network as a Service??????????????????????NaaS

Platform as a Service??????????????????????PaaS

Security as a Service???????????????????????SaaS

Software as a Service

Unified Comm as a Service???????????UCaaS

Anything as a Service??????????????????????XaaS

Zero Trust as a Service???????????????????ZTaaS

IT as a Service????????????????????????????????????ITaaS

Load Balancing as a Service??????????LBaaS

?If a company is in the cloud, they use the below model. If they have a hybrid cloud platform, they have both on-premises and cloud environments. The further to the right, the less they are responsible for, but they need to pay a higher “as you go” price tag. The top cloud IaaS providers are Amazon Web Services (AWS), Microsoft, Google, Oracle, Alibaba and IBM.

?Figure 5: Cloud Service Models (credit: Packt)

?The advantage of being a Distributor in a world of change

?In today's rapidly shifting market, Distributors find themselves in familiar territory. When shifting industry dynamics occur, it's not unusual for Distributors to become the preferred resource for both Vendors and the Channel Partners because they are already in the markets that have the highest growth.

?As an example, if a Vendor ads IoT (Internet of Things) technology or a new computing device to their portfolio, the Distributor has the channel reach to find the appropriate partners, the ability to market and the personnel that understands the technology. If the Channel Partner chooses to add to their line card many Distributors have the technology Vendors, and subject matter expert guidance, to accommodate.

?Vendors and Channel Partners reap the most rewards when they find new ways to further leverage and strengthen their Distribution partnerships. Whether in the cloud or physical warehouses, Distributors excel at serving the channel and providing the multivendor solutions and services that make all businesses better.

?What does a transaction look like in Distribution?

?Quote:

?Typically, the transaction begins with either a quote or a customer purchase order. In the case of a quote, the Channel Partner and Distributor define the components of the quote. The components are typically from a list of sku’s that are recognized by the Vendor and Distributor. The list of sku’s (one or more) is known as a bill of material (BoM). The assigned salesperson creates the quote. Typical salesperson assignments would be a geographic territory, a tier of partner or some are assigned to specific partners.

?Each Channel Partner has different discounts applied to the quote depending on the Vendor, the product, the Channel Partner tier Level (typically established by the Vendors partner program) and other factors. Non-standard pricing (NSP) agreements may also be in-place. The NSP is an agreement between the Vendor, Distributor and Channel Partner allowing a deeper discount to the channel as a reward for additional support, a tool for challenging competition, a deeper discount for registering a deal before a PO is processed or a weapon to displace the incumbent Vendor. As the NSP naming is a Vendor program, Vendors use different names for the program, but it has the same methodology and intent.

?What’s an ERP system?

Enterprise resource planning (ERP) is defined as the ability to deliver an integrated suite of business applications. ERP tools share a common process and data model, covering broad and deep operational end-to-end processes, such as those found in finance, HR, Distribution, manufacturing, service and the supply chain. The quote tool talks to the credit team that talks to the staging/shipping group and so on. Everyone is connected in the same system.

?Discounts should be loaded into the ERP system, so when the Channel Partner account and any sku is entered into the quote tool, the discount is automatically calculated on the quote. The back-end system configuration is typically loaded by a group called sales operations (SalesOps) or Product Management (PM) teams. While most Vendors cannot dictate the exact price offered to a Channel Partner by a Distributor, many Distributors attempt to support the Vendors partner program and tiered pricing models. Some ERP systems have Channel Partner lockouts. Many Vendors require a Channel Partner to be authorized to sell their products and services. The ERP system should stop the salesperson from entering the sku or the tool from entering discounts.

?What’s a deal registration?

A deal registration (DR) is a program for Channel Partners in which the Vendor is informed about a business opportunity and is provided priority for it. The Channel Partners, like system integrator partners or value-added resellers, are provided with a definite period to bring the deal to a closure. The Channel Partner that first registers the deal with the Vendor typically sees a deeper discount thus, the Channel Partner has an advantage if a competing Channel Partner attempts to quote the same project. Think of a DR as a reward for the Channel Partner cultivating opportunities on behalf of the Vendor.

What’s a sku?

Sku is defined as stock keeping unit and each component, hardware, support, software and services should have a unique sku. Sku’s are usually a combination of letters and numbers. From time to time, and regularly on the services side, a sku needs to be created for a SOW, or scope of work/statement of work. Some services are non-standard and applying one cost (or sell price) isn’t possible until the parameters are discovered and calculated. The sku is loaded into the Distributors ERP system along with a description and any associated costs to the Channel Partner.

?How does a salesperson find the appropriate sku if the request is ambiguous or unknown?

Most Distributors have presales engineering support assigned to Vendors on their line card. The engineers can go by different titles: Presales Engineers, Solution Architects, Field Sales Engineers and Design Architects.?The Vendor engineering teams are also utilized when needed.

?Sales Order:

?Once the quote is in the ERP system and delivered to the Channel Partner the Channel Partner reviews and, if the quote fits within the expectations of pricing, lead time and other factors, approves the quote. It’s then converted to a sales order. That order may or may not be held for immediate review depending on the credit profile of the Channel Partner. Customers can order via purchase order (PO) or credit card. Credit review, approvals and authorization is done before the order can be fulfilled.

?Stocking, Shipping, Fulfillment and Chargebacks:

?Depending on the product and the stocking profile of that product (tangible product in a warehouse or intangible product such as software, service or maintenance) the ERP system will either ship from stock or generate a purchase order to the Vendor. That purchase order is then either fulfilled by the Vendor and shipped to the Distributor's warehouse or its drop shipped from the Vendor to the sales order specified location. In addition to determining the stocking process, the ERP system will assess what Vendor related charge back (incentives) can the Distributor claim and attached to the order. Final price for the order (revenue minus cost of goods sold (COGS) plus chargebacks) defines the margin for the order.

?Once the order has been fulfilled (if tangible, shipped from the warehouse or if not tangible, electronic delivery) the Distributor generates an invoice to the Channel Partner. It is at that moment that most Distributors can recognize the revenue. Once the order is invoiced, the point of sale (POS) is generated and sent to the Vendor.

?Inventory Management:

?in conjunction with the ordering process, the Distributor manages its inventory based on algorithms that utilize purchase history, sales forecasts and other economic, social or political factors that must be anticipated to maintain proper stocking levels. If inventory is shipped to, or received from, other countries foreign exchange risk can play a role. It is also worth noting that there is a list of countries that are banned from receiving products from most US-based Distributors.

?Inventory is an economic science. If the Distributor carries too much inventory, the Distributor loses money in carrying costs. If the Distributor carries too little inventory, the Distributor may miss out on customer opportunities.

Many Vendors offer a stock rotation program for aged inventory. Stock rotation is a way of mitigating carrying cost loss due to some products not selling or if the Vendor has EOL (end of life) or EOSL (end of service life) their products. The latter two are common once a product has reached the end of the product lifecycle.

?Finance:

?Finance options are a key value for the Distributors model by attempting to remove Channel Partner financial obstacles that limit growth or opportunity. Many Vendors prefer their Distributor carry the short-term debt through their programs while keeping risk sharing to a minimum.?Most Distributors offer a variety of customized finance options that ensure their Channel Partners have the ability to secure as many opportunities as their payment history, credit score, business size and business processes allow. Net terms (pay in 10, 15, 30, 60 or 90+ days), trade credit, flooring accounts and other credit vehicles are offered.

?As all credit lines have caps, Channel Partners usually leverage multiple Distributors to spread (or improve) their sales revenue with more than one credit line.

?It should be noted that the Distributors finance team also assists in the creation and supports the previously discussed “as a Service” model allowing Channel Partners (and their customers) a subscription-based solution model for products. As an example, they can pay monthly, quarterly or annually for a firewall (virtual device) with payments at a fraction of the cost of buying the unit outright.

?Distribution Go-to-Market (GTM) Strategy

What’s GTM?

A go-to-market (GTM) strategy is a plan that details how an organization can engage with customers to convince them to buy their product or service and to gain a competitive advantage. A GTM strategy includes tactics related to pricing, sales and channels, the buying journey, new product or service launches, product rebranding or product introduction to a new market.

?Clearly, Distributors are motivated to continue to evolve their line card, services, internal systems, financial offerings and marketing to remain relevant to both Vendors and Channel Partners. As a result, they are looking for the latest in emerging technologies, delivering advanced partner technical education, Practice consulting (assisting the Channel Partner with all aspects of ‘how to sell’), focusing on operational efficiency and sales specialization training on behalf of Vendors that have the vision to leverage these services.

?Now, more than ever before, Distributors are working hand-in-hand with the Channel Partner growing revenue and loyalty by helping them identify new technology, sources of additional revenue and market practices through Distributor-facilitated business planning. Distributors are also helping Channel Partners with business transformation awareness and training as cloud computing, software defined networking, green technology, remote workforces and digital transformation (DX) continues to encroach on traditional on-premise business models.

?To realize, and fully utilize, the extent of the Distribution value and partnership, Vendors are asking Distribution to support the Vendor GTM at many levels; field sales, inside sales, engineering, marketing, creative financing, Channel Partner training and enablement, professional services (ex: deployment) and in select cases, research and development (R&D). To a certain extent, the Distribution evolution requires the Distributor to replicate the Vendors workforce.

?The Distributor's footprint

?Distributors strive to have strong routes to market. The intent and goal with many larger Distributors, in partnership with their Channel Partners and Vendors, is to maximize their geographical markets.?When a Vendor carefully selects their Distribution network, Distribution footprint is a key factor. Many Vendors look for Distributors that give them access to a geographically large (or global) strategic positioning in key geographic markets to more effectively reach and drive opportunities for their Channel Partners across targeted, fast-growing or emerging markets.

?Many Distributors are evolving to become subject matter experts in operationalizing the global transaction methodology. This includes not only products but also services. It’s a complex and challenging endeavor with differing rules, laws and associated costs.?

?Core capabilities of a Distributor with a large (or global) footprint include:

·????????Standardized terms and conditions

·????????Single point of contact

·????????Utilizing regional partners globally

·????????A logistically and tax efficient network

·????????Utilized in country pre- and post-sales support skills

·????????The ability to provide management reporting and escalation

·????????Execution within Vendor approved schemes

·????????Local currency, local tax billing

·????????Reduced cost and lead times for Channel Partner and End User

·????????Global logistics solutions

·????????A clear pricing model

·????????Multi-currency invoicing

?What’s a SPOC?

The abbreviation SPOC is a term used with the meaning "Single Point of Contact" to refer to a single person or team within a company who are designated as the point of contact for all incoming communications.

?Which Channel Partners leverage this type of program the most?

·????????Global service providers (SP’s) and system integrators (SI’s) who require global terms or conditions and a SPOC to fulfill their global customers’ requirements

·????????Local or regional Channel Partners who do not have a global presence and need a partner to fulfill their global customers’ requirements.

In closing...

?It’s an exciting time to be in Distribution. As many Vendors begin to grow in the IT market, and new products and services are being created, leveraging Distribution will be key to their success.

?The Distribution decision often isn’t an easy one for the Vendor. While some are looking for a Distributor to only offer financial or logistical support for the Channel Partner and End User, others are looking for much more. The right Distributor is a step ahead.

As we have discussed, Distribution channels are the methods by which companies deliver products and services to customers and end users. Some businesses sell directly to their customers, while others might use a Distributor to serve as an intermediary.?

It’s important to note, this tutorial discusses IT Distribution. There are many different channels where Distribution has a role, but they may not look the same as outlined in this document. As an example, the internet or catalog can also be considered a channel option for Manufacturers.

?In many Distribution models you will hear roles like Retailer, Wholesaler, Agents and Brokers.

Retailers are intermediaries used frequently by companies. Examples include supermarkets, pharmacies, restaurants, and bars. Each of these types of businesses has full sales rights. Generally, product prices are higher in retailers.

Wholesalers are intermediaries that buy and resell products to retailers.?Wholesalers?sell to those who are going to put products in their own stores. These intermediaries generally don’t sell small quantities to final Consumers, though there are exceptions, like supermarkets that sell in the wholesale model.

Agents?are legal entities hired to sell a company’s goods to final consumers and are paid a commission for their sales. The relationships between intermediaries and companies are typically long term.

Brokers are also hired to sell and receive a commission. The difference between Agents and Brokers is that Brokers usually have short term relationships with the company.

?The above channel roles are common in food and beverage, clothing, cosmetic, oil and gas, consumer electronics and many more.?

?Below you will find some common terminology you will be using or hear around the office:

?KPI

KPI?stands for?key performance indicator, a quantifiable measure of performance over time for a specific objective.?KPIs?provide targets for teams to shoot for, milestones to gauge progress, and insights that help people across the organization make better decisions.

?QBR

A QBR is typically held every 3 months to discuss past and/or future looking business objectives or activities. A common agenda includes (but not limited to): review goals and KPIs, show achievements, inform stakeholders of challenges, share underlying opportunities and discussing a roadmap and goals for the future. These meetings may be replaced or augmented with a planning session – discussing GTM.

?RMA

A?return merchandise authorization?(RMA), return authorization (RA) or return goods authorization (RGA) is a part of the process of returning a product to receive a refund, replacement, or repair during the product's warranty period. Typically, a Vendor approves any item being returned prior to the device or product being sent back to them. Can also apply to software, licenses and services.

?Sales Pipeline

A?sales pipeline?is a visual representation of?sales?prospects and where they are in the purchasing process. This enables?sales?reps, sales?managers and executives the ability to forecast the number and dollar amounts of deals that will close in a given period of time.

?NPS (Net Promoter Score)

An NPS allows organizations to measure a customer’s happiness, loyalty, and the likelihood that they will refer new customers. A portion of each customer’s score is often based on their response when they’re asked how likely they are to recommend a product or service to others.

?B2B

Business-to-business (B2B), also called B-to-B, is a form of transaction between businesses, such as one involving a Vendor and Distributor, or a distributor and a Channel Partner. Business-to-business refers to business that is conducted between companies, rather than between a company and individual consumer. A business selling to a customer (or End User) is called a B2C transaction.

?SLA

Service Level Agreement?– An SLA is an official internal document that defines the role of internal teams or people to satisfy an internal or external request. An SLA can cover the amount of time that is acceptable to respond to a Channel Partner. An SLA can also cover teams like product management, marketing and the finance group to name a few.?

This article was created on 7/9/21 by Brad Wilkins as an update to a previous version created in 2013. This article was created with the support of my predecessors, vendor associates and leadership colleagues.