The domino effect of distributors

The function of distributors has changed, creating a domino effect across various industries, particularly in the technology sector. The way of conducting business has undergone a complete transformation as well, and companies are now seeking to enhance their technological abilities to improve their digital strategy.

In a recent HSBC survey, over 50% of companies in Singapore believe that hybrid working promotes innovation. As organisations adjust their office plans to better accommodate employees’ requests for more flexible ways of working, it is not surprising that many are turning to technology to help accommodate these changes.

Business strategies are also undergoing significant changes, and many parts of the distribution channel have needed to adapt, particularly with the growing popularity of as-a-service offerings. In the region, Singapore stands out as a leader in terms of business technology adoption.

This growing demand has led to changes within the distribution channel industry. For instance, many companies are relying on various partners to reach and bill their customers, rather than using direct translation models. By doing so, organisations are able to better personalise experiences, deliver targeted customer benefits, and foster brand loyalty. Updating their go-to market strategies is the first step to ensuring business relevance in this changing landscape.

Customers have also become more knowledgeable about buying processes, and partners must train their employees and equip them with the right knowledge and tools to deliver exceptional customer service. Distributors should also prioritise upskilling so that employees have a comprehensive understanding of the technology. Doing so will set distributors apart from their competitors.

Distributors and the domino effect 

Proper management and understanding the role of what every channel partner can bring to the table is essential in establishing meaningful partnerships. The role of the distributor is perhaps the most critical to ensuring business success.

Distributors have become crucial to the channel partner model, especially in the technology sector, which has seen tremendous growth in the last few years. With the rapid adoption of digital technology across industries, the demand for technology products and services has seen a huge surge. As the role of distributors becomes increasingly important, other channel partners must reevaluate their strategies, especially in the current climate of uncertainty, which is having a cascading impact throughout the entire value chain.

Stepping up SaaS: From a ‘maybe’ to a ‘must’ 

With the software-as-a-service (SaaS) market growing at a rate of 18% year on year, SaaS vendors can no longer rely solely on providing an advanced marketplace for transactions. They will need distributors to provide augmented services around new resellers, recruitment, enablement, and knowledge-based services. Many SaaS providers consider their distribution partners to be a vital component of their business strategy.

This means that distributors need to start thinking about their offerings as an integrated entity, rather than focusing only on a single facet that brings in the greatest revenue. For example, they might need to rethink how they can provide support for their level two and three vendors as this is an area where partners need the most assistance to build customer loyalty.

In order to stand out from the competition and provide more value to their customers, distributors need to expand their offerings to include integrated services. As businesses reassess their channels and look to strengthen their digital strategies, relying on distributors is no longer just a trend, but a critical need.