In the manufacturing and technology industries, sales contracts, pricing incentives and promotions all drive channel partner relationships. But these approaches don’t always work like they should, and common mistakes can take a heavy toll. In fact, a recent study conducted by Forrester Consulting on behalf of Revitas found that 37 percent of manufacturing and technology companies surveyed experienced revenue losses of 11 to 50 percent by overpaying on promotional incentives.
The study, titled “The Power of Three: The Benefits of an Integrated Approach to Contract, Revenue, and Compliance Management,” explores how the management of sales contracts, pricing incentives, and promotions impacts the effectiveness of channel partner relationships in the manufacturing and technology industries.
Forrester surveyed finance, sales, and channel management executives in the manufacturing and technology sectors to understand how they manage sales contracts, pricing, and promotional incentives. Here are just a few of the takeaways, and their implications:
The research report concludes that using an integrated solution to manage channel sales contracts and incentives offers substantial benefits for manufacturing and technology firms that want to get the most out of their channel sales partnerships. Such an approach enables organizations to use incentive programs as a strategic business lever, while eliminating revenue leakage and improving partner loyalty.
Do you agree? What is your experience with rebates, brand promotions, and other post-sales incentives? Do they help you drive channel sales? If so, how can you tell? Join the conversation by leaving a comment below.
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[A version of this post originally appeared on The Revitas Blog.]