Everything You Need To Know About Channel Sales

Need To Know About Channel Sales

What is the biggest challenge an organization faces? Scaling revenue, right?

However, your salespeople end up spending a lot of time hiring resources, automating tools for boosting efficiency, and removing all possible distractions, rather than focussing their time and efforts on product sales. In this process you also end up increasing your operating expenses, minimizing your potential income and profit margins significantly.

So, how can you scale the growth of your organization with the existing team and resources?

Well! The answer is relatively simple. Online channel sales is one of the game-changing strategies that will provide you with the advantage of hiring more sales representatives for your organization without affecting your profit margins.

According to Forrester, channel sales represent 75 percent of eCommerce sales globally. Distribution channels for online business have helped a lot of companies in expediting sales and generating significant revenues. It has especially proved to be vital during economic uncertainty.

Therefore, if you want to launch a channel sales to scale up your business efficiently, step into a new market, or meet your customer needs, we have created a guide that will help you in doing so.

What are Channel Sales?

What are Channel Sales

A digital channel sales is essentially a distribution method in which you can segment your sales process through a third party. It is known as channel sales because it enables you to sell your products through multiple channels like partners, resellers, dealers, distributors, brokers, agents, affiliates, and many more. It is also called “Indirect Sales” since your organization will not interact with the end customers directly.

Types Of Channel Sales

Types Of Channel Sales

Distribution channels for online business provide you with almost multiple alternatives to choose from. The only thing you need to keep in mind is the arrangements that will work best both for you and your channel partners. Now let’s explore some of the essential channel sales types. 


Resellers are the ones who will purchase products manufactured by your company and resell them to the end customer, thereby earning profit. It acts as an intermediary between the manufacturing company and the customers. This way, the customers always rely on the resellers to purchase the product they want, and on the other hand, the resellers will work with the manufacturing companies to fulfill the orders.

Value-Added Resellers (VARs)

Value-Added Resellers or VARs is another type of online channel sales. They are the companies that purchase and resell technology products having additional software or features that go beyond the standalone features of the product. A computer company selling hardware with pre-installed software of your company is an example of value-added resellers.

Affiliate Partners

In this type of digital channel sales, you have to pay a commission to the website’s owners, individuals, or businesses promoting your products. They are known as Affiliate partners. Every time they bring in new sales, they are paid a percentage of it. The most popular affiliate partnership platform is Amazon Affiliate Program.


Distributors are that type of channel sales that provide products directly to the consumer. They are the agents, websites, or businesses that act as a mediator between the producer and the buyer.

Who Are Channel Sales For?

Sales channel integration is essential for a business that is looking for a higher reach and scalability. This type of sales strategy is generally implemented for selling the product or service via in-house sales teams, affiliates, partners, and retailers. You can increase the opportunity to increase your sales and grow your business when you choose to utilize all these channel sales options.

However, before grabbing these opportunities, there are certain points you need to consider:

  • Size Of The Business: Small Businesses find the hiring and training process relatively challenging. Hence, channels work wonders for them. Moreover, it is a great option for larger businesses too. However, they have to focus more on funding to hire a sales team. Based on the size of your business, you might need a manager that knows what is a channel sales strategy and manages all processes efficiently.
  • Defined Sales Process: Before getting straight into the channel sales, it is recommended to have a defined sales process. This way, both you and your partners will work together and implement the same process seamlessly.
  • Location and Reach: Is your business spread out in multiple distinct locations? Or, are you planning to expand your business in several locations? Then, the sales channel option is one of the best options. With the help of this option, you can acquire a broad area without investing a large amount of money and resources.

How To Implement Channel Sales Strategy Into Your Business?

Implement Channel Sales Strategy

Before implementing the channel sales strategy, the first thing you need to know is the location where you want to potentially market your product and services, and the channels you want to include in this process. Taking this into consideration, here is the step by step process of implementing this strategy into your business.

Select Appropriate Partners

While selecting the most appropriate sales channel integration, you need to consider their expertise, sales and marketing process, brand values, market and demographics.

It is because you will only work with partners that are highly experienced in your equivalent field, share similar values, and have demographics that connect with your products and services directly. Bear in mind that they are going to represent the most abundant face of your brand. Therefore, be conscious while selecting appropriate partners.

Focus On The Needs Of Partners

Now that you have begun talking to the potential partners, ensure to consider their needs as the center point of the conversation. They will never show their interest unless they are also getting the benefit from the deal. Explain to them how you will help them if they sell additional services, reach new audiences, or enhance the value of your product and services.

After you have established partnerships with a few channel partners, you need to choose an appropriate structure for it.

Structure The Channel Sales Strategy

The entire process of selecting a sales partner revolves around the channel sales strategy. It ensures that all your business goals are achieved consistently. Therefore, the most efficient channel sales strategy will outline the:

  • Objectives that will align with your business functions and support your overall sales, marketing, and business goals. With the help of these objectives, you can define the expectations of your partners and ensure they understand the process appropriately.
  • Measurement to define the success of your business by analyzing and monitoring significant metrics. It should also ensure that the partners you are selecting are productive and profitable. This way, you will get a clear picture of what is working and what is not working with your partners.
  • A transparent process, including onboarding, ongoing support and management with the partners, and a guided sales process. This way, you will be able to promote productivity within all the channel sales processes.

Empower Your Partner To Perform

In channel sales, you have to empower people, on whom you do not have an influence on, which can be a very challenging process. If a salesperson working in your organization does not meet your expectations, you have the option to either continue working with him or put him on a performance review plan. However, if the partner is unable to sell your product, there is no option left other than terminating him from the program, which is not a desirable option at all.

Therefore, if you want to actively engage your partners in selling the products, you need to integrate resources that will streamline the selling process. It will make you invest twice more than the amount you invest on the content for your sales reps, because your partners are less familiar with the product compared to your sales reps.

Ensure that they have a transparent, comprehensive, prospect-ready product specifications, objection-handling cheat sheet etc., to increase the confidence and motivation levels of your partners to sell the products.

Measure The Performance Using Sales Channel Partnership Platform

If you want to know whether the channel sales program is working for your business, you need to measure some of the metrics like the total number of partners, average sales cycle length and value of partner deals, percentage of partners actively involved in the programs, cross-sell and up-sell rates for partner sales versus direct sales, and retention rates for partner sales versus direct sales of your business.

These metrics help you to determine the effectiveness of the program and each partner. This will also help you to explore new opportunities or make adjustments to the programs.

Key Takeaways

It doesn’t matter what type of product or service you sell or the type of industry you are in. You should know that a channel sales strategy is a crucial component of your business growth.

Although the channel sales program is a key investment involving significant time and resources, it will have a substantial impact on your company’s achievements. You will not only reach new customers, but also develop valuable relationships within your industry, thereby increasing sales and revenues.

Further, from recruiting to onboarding or managing and motivating partners, each step of the process should provide long-term benefits to the vendors with the help of online channel sales.

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