Software Channel Entry Fees Skyrocket; Vendors Bundle Options -- Free Support is Over
BOCA RATON, Fla.--(BUSINESS WIRE)--Feb. 10, 1999--In the latest analysis of reseller channel practices within the Software industry, entry fees are beginning to take-off.
"Companies are developing Value-based support packages from which resellers choose," said Patricia Colbert, president of the Chandler Group. "A software reseller now must select from column A, B or C, depending on how resourceful it is," she added. The study showed that more and more of the services that were free are now being added to the list.
Sales training, NFR demo packages, telephone support and certification incentives are just some of the services that were provided free as motivation to join a channel program. Now they are part of a chargeable package. If the vendor has maintained the fee amount, generally support costs have been separated or services reduced. "It appears to be a trend that software vendors can't afford to give tangible products away as a channel investment," Colbert commented. Companies are charging up to $7,000 to join ranks and provide the training necessary to become certified. The average cost to enter a program is up to $2300. Vendors have increased annual sales requirements, the cost and depth of certification and generally made it more expensive to resell a product line.
The Reseller Channel Programs Report: Software Vendors was recently published by the Chandler Group. It includes an analysis of each of 12 vendor's program features, discount structures, support practices and channel incentives. The companies analyzed are: BAAN, BMC, Computer Associates, Check Point, Compaq's AltaVista, JD Edwards, Lotus, IBM, Microsoft, Novell, Oracle, and Symantec.
The Chandler Group
The company was formed in 1988 as a focal point for channel program strategies. It is the only consulting firm in the technology industry solely committed to the research and analysis of distribution and program strategies. Complementing this report, the company also publishes competitive studies on Networking and Hardware Vendor's distribution channel programs.
CONTACT:
The Chandler Group, Boca Raton
Pat Colbert, 561/392-9220
chandler@gate.net
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