Channel Churn
The conversation around channel manager turnover has become a major topic throughout the industry. I think it’s important for us to take a closer look at some of the behind-the-scenes changes our industry is experiencing and the ways they’re impacting all of us. Based on conversations I’ve had with many channel leaders, these changes are creating significant headwinds across the ecosystem. I believe It’s limiting our ability to achieve higher growth and is contributing to the ongoing challenge of employee churn.
1. Channel Inflation Costs
I am being told by many suppliers that it is more expensive than ever to be in the channel and have a channel program. The supply and demand on good channel managers has increased costs almost 2X in 10 years. We were 50 suppliers 10 years ago and now we are 500+ and the demand to get into our industry isn't slowing down. This increased demand for channel managers has pushed costs from about $75K base to upwards of $120K to $140K base, even higher if they have a lot of experience and proven success history. (This supply and demand also affects MDF programs but that’s a story for another day.)
2. High Quotas
When you have channel managers with a base salary that large, in order to remain profitable, your channel manager has to sell a lot, quickly. Failure to do so can put a company's channel program upside down quickly. This has pushed the expectations for channel managers (quota & time to profitability) in many cases to unattainable levels. New employees are not going to understand the nuances of the requirements, time frames, and the difficulty of hitting that quota for that company until they are well into their role. Especially those new to the channel.
3. Consolidation
We’re seeing a massive wave of consolidation right now. A lot of long-time partners who built incredibly successful businesses over the last few decades are cashing out and leaving the industry. When a major partner exits, it creates a vacuum in that territory. The revenue they were producing doesn’t just get replaced overnight. That shift can throw a serious wrench into a channel manager’s ability to hit their quota, especially if their territory is heavily reliant on that one partner. Rebuilding that book takes time, relationships, and trust, and in the channel, none of those happen quickly
4. No Channel Manager Training Programs
I don’t know of a single supplier who has a structured training program specifically on how to be a channel manager. If there is one, please let me know because I have spent the last two years trying to find a channel supplier who has one. This means a new channel manager has to learn on the job with trial and error, which creates friction with TSDs and Trusted Advisors when there’s a drop in performance or inconsistency in the partner experience. Most channel managers learn one-on-one with a mentor or someone who takes them under their wing, which isn’t scalable at the levels we need right now.
This issue may seem like it only affects supplier leadership and the channel managers they hire, but I believe it’s actually a channel wide problem. When we see high turnover, missed quotas, or fractured relationships, it doesn’t just impact one company or one rep. It affects the entire ecosystem, suppliers, TSDs, and Trusted Advisors. If we want to protect what makes this channel special, we need to come together, not just as individual companies, but as a community and build smarter, more sustainable solutions that benefit everyone.
I’d love to hear your thoughts. How do we fix this? What ideas or approaches have worked for you? If you’re a leader navigating these challenges, what’s helping?