IT and Business Insights for SMB Solution Providers

The Importance of Vendor Relationships

I am blessed in my role to have observed hundreds of MSP’s over the past 30 years, along with my own 27 year stint leading HTS to become an 18M+ company.

Over that time I observed and experienced 5 key barriers to growth that I want to briefly tell you about, focusing on the fifth in this blog post as I have found it to be crucial.

  1. Building a consistent and predictable sales engine
  2. Generating quality and adequate lead flow through marketing
  3. Disciplined process, operational and financial controls
  4. Leadership development and creating next generation leaders
  5. Building effective win/win relationships and partnerships

Without a doubt the most important of these is the last – the ability to create, nurture, maintain and grow deep and lasting relationships that are good for all involved.

There is an attitude in the IT channel that vendors and distributors are at best a necessary evil and at worst the enemy.  If you don’t hear anything else I write here, please remember this:

Growth companies not only value their vendor relationships, but give them equal or more attention and care than their customer relationships.

You will not become a sustainable growth company if you do not have building and nurturing strong vendor relationships as one of your core strategies.  Businesses cannot grow in a vacuum.  We grow together, learning to leverage the resources that each brings to the table.

As partners far too often, we believe vendors owe us something.  After all, we are the customer.  Here’s a news flash.  They don’t owe us anything.  In fact, we owe them far more than they owe us.

I hear the objection that “I don’t sell anything as an MSP.”  Strip away all the things that you purchase externally and tell me what’s left of your offering.  Your people are all that remain, and let me assure you they are not something you’re going to build a growth company on by themselves.

We all sell lots of things.  Most MSP’s have over a dozen tools in their offering sourced from a vendor.  Our back offices run on products sourced from a vendor.  We need vendors to grow because no one is an island.

I’ll climb down from my soapbox and say this.  In my 30 plus years of personal experience and observation of those who truly grow their companies, vendors have been a central strategic focus.

How to Leverage Vendor Relationships

At HTG we spend a lot of time talking about the importance of relationships.  Here are a few practical ways to create and nurture strong relationships with your vendor partners:

  1. Learn how to partner and plan together.  This takes time. As CEO of HTS one of my highest and best uses of time was my ownership of the strategic relationships with vendors.  At our peak I was spending three weeks a quarter in a city halfway across the country working with one of our key vendors.  It was an investment that paid dividends for us, but it had a sharp learning curve.

HTG has taken what we have learned from successful members who do partner well with vendors and created a Member-Vendor Joint Planning process.

  1. Spend time building deep and lasting relationships.  Vendors are companies, but relationships are not with companies. Relationships are with people.  I still have coffee with my Microsoft PAM anytime one of us is anywhere close to the other’s home city.

I also enjoyed learning about my vendor partners, about their kids and their personal interests.  I learned how they were uniquely compensated and what we could do to help them reach their individual goals for a bonus, etc.  This took time but was one of the most enjoyable parts of my role.

  1. Bring your “A” game to the relationship.  Many partners come to a relationship looking for what they can get from the vendor. They have a long list of expectations.  Bringing your “A” game means showing up to be a good partner.

It involves setting goals together and working to achieve them.  It means having a commitment to perhaps meet a certain quota or being accountable to follow through on engaging in a partner program.

Growth companies who maximize their vendor relationships are Go Givers who give more in value than they expect to receive.  In turn, they often receive their vendors’ loyalty and find themselves blessed in return.

My challenge is to talk to each and every vendor you run across, whether you currently or even in the future anticipate ever doing business together.  We can learn from everyone we encounter.  We can gain valuable insight into how to grow.  Take the time to get to know these folks as people and partners in this IT world we all serve.

In the end it’s those who understand the value of relationships and make the effort to connect who grow their companies.

Business stagnant?  I encourage you to assess the health of your strategic vendor relationships.

HTG is offering a workshop to teach members how to utilize this important planning process on Wednesday afternoon, August 3, 2016, in Denver.  Plan to attend.  Also be sure to put Wednesday November 2 on your calendar to experience “We Build,” our 2016 Partner Pavilion where the best IT companies and vendors connect to partner and grow together.

About the Author

Arlin Sorensen's picture

Arlin Sorensen serves as the CEO and Founder of the Heartland Companies which includes HTG Peer Groups. When he is not traveling to speak and consult, he is home on his farm in Iowa with his wife Nancy. He is a proud “Pop” to four precocious grandchildren who serve as daily reminders of why he is intentionally living to leave a strong legacy of faith and integrity. He loves making a difference in the lives and businesses of small business owners. You can reach him at [email protected] or on Twitter @asorensen.

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