78% channel partners yet to make shift to subscriptions

Westcon-Comstor has published Navigating the shift: The role of distributor marketplaces in Partner Success. The report conducted over the last three months reveals that while almost every channel partner is shifting to subscription and recurring revenue models, the vast majority say they are facing challenges and have more to do to make the shift.

The report, based on a survey of almost 300 channel partners in the UK and Australia, explores the challenges of a changing market and business models, looking at both macroeconomic factors and changes specific to the channel, plus what is needed from distributor marketplaces.

Despite a challenging environment, most channel partners have started their migration to subscriptions and services. Only 21 per cent, however, say that they have gone as far as possible. This leaves the majority, 78 per cent, partway through this journey and facing a variety of challenges in realising full migration.

With the shift to subscription and recurring revenue models comes complexity, and this is reflected in the challenges partners face. Just over half (52%) cite the need to manage a complex multi-vendor portfolio as the biggest challenge they face.

Channel partners are looking to distributors, and in particular distributor marketplaces, to help overcome these challenges. 60 per cent believe that a single platform to buy hardware and software will help accelerate this shift. Yet today less than half (49%) of partners are using distributor marketplaces.

Those partners who have started to use distributor marketplaces cite self-serve stock availability (49%), online ordering (49%), and pricing (42%) as the biggest advantages and are looking for better access to customer data (55%), market data (39%), and customer success training (46%). There is a promising opportunity for distributor marketplaces to offer a richer set of services and capabilities than what is being provided today, which will truly help them on their growth path within this new model.

Patrick Aronson, CMO, Westcon-Comstor said, “We see the B2B world evolving much as the B2C world did. We all know how important marketplaces, e-commerce, and digital interfaces have become. Our experience is that channel partners are keen to modernise and embrace the recurring revenue and subscription business model. It’s great to see the dynamic and forward-thinking partners we know reflected in this report. As a distributor, insight into the challenges our partners face is key to creating the right marketplace solution they need to serve their customers as best they can.”

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