The Channel Post

There is no denying that it’s been a tough, tough year for many in our industry. With signs of “recovery’ around job growth (albeit small and certainly protracted over the next 12-18 months) and improvements in the stock market, there is certainly room for optimism in the coming year ahead.

But for this past year our clients have managed their budgets much more tightly and with an eye towards spending on only those things that  correlate directly to tangible benefits whether that be operational efficiencies or actual sales revenue.

We’ve discovered some consistent themes in terms of channel priorities for 2010.

• Remodeling and validating partner programs
• New incentives to drive specific behaviors within channel
• Optimizing existing channel “spend”
• New markets
• Optimizing internal sales teams
• Partner training and enablement

We hope these insights have been helpful and that may be able to use them as a benchmark against for your own strategic channel planning process for the upcoming year.

Sounds like an oxymoron, doesn’t it? It is probably the number one issue that causes mistrust, conflict and legal issues between a manufacturer and channel partners. This article is not intended in any way to be a discussion of what is legal, ethical or the ‘norm’. This is about managing exception pricing within the channel.

Let’s define the term Exception Pricing as non-standard, discount from published pricing, or as the dictionary states “ something excepted; an instance or case not conforming to the general rule.” I’ll take it one step further. Exception pricing is given to a select partner(s) or customer(s).

This assumes a couple of points:

1. There is a ‘general rule’ which means the starting point is standard, published pricing, for purposes of this discussion.
2. Exception always means a discounted, lower price.
3. These variances can be managed fairly, legally and consistently.

There are some legitimate reasons for exception pricing of course.

* Large volume purchases
* Product clearances
* Public bids
* Competitive pressure
* Customer loyalty programs
* Cost to serve

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Do you have projects just sitting on hold due to a lack of funding?

Have you thought about government funding, but were never really quite sure how the appropriations process works?

Do you believe that the only way your technology company can obtain government funding is through Small Business Innovation Research (”SBIR”) Grants?

If you have or are working on a technology project that a government agency may be interested in, a federal earmark could be a real possibility for your company. The weak economy and tight federal budget combined with less investment money make the 2011 Appropriations Cycle more critical then ever.

The Federal Fiscal Year begins October 1 and is named for the next calendar year. Therefore we are currently in FY 2010 with FY 2011 beginning on October 1, 2010. Federal agencies are currently finalizing the funds authorized for FY 2010. However, the same federal agencies are also preparing their budget proposals for FY 2011.

In February 2010, President Obama will submit his FY 2011 budget request for the federal government to Congress. After the Budget is passed, the pot of funding will be authorized for Federal Agencies. However, if you wait until then to begin your effort to obtain a FY 2011 appropriation, you will be left empty handed.

If your pitch is successful, a member of Congress will request your project funding to the appropriate subcommittee of the appropriations committee. Your project is not funded yet, as it will have to survive the appropriate subcommittee and pass a vote by the full House or Senate. Then a conference committee mark-up will take place where any differences between the House and Senate versions of the bill will be worked out to form one conference bill. The conference bill then has to be voted on by both Houses of Congress and if signed by the President will become law.

The process is very competitive and has only grown more so over the years with the drop in federal funding and inability to obtain funding from the private sector. In order to succeed in obtaining an appropriation it may be in your organization’s best interest to hire a lobbying firm. However, whether you decide to hire help in order to attempt to secure funding for your project or go at it alone, the key will be to grow awareness of your project and get it in front of the right people as early along in the process as you can.