Avaya lets VARs set margins

Avaya plans to roll out wholesale maintenance services for which US partners can set their own prices and determine the margin.

In the US, the vendor plans to debut "codified", productised services through distribution in June.

Avaya would make wholesale professional services such as network assessments three months later, said Louis D'Ambrosio, group vice president of global sales, channels and marketing at Avaya, at a US conference last week.

"Some partners prefer to have services and the full solution on their books. For them, the wholesale model is more appropriate," he said.

Avaya would keep paying a fee to partners that represented Avaya services and encourage partners to offer their own services where appropriate, he said.

US partners would be able to resell the services at whatever markup they chose by putting the new wholesale services on their books, D'Ambrosio said.

Grant Howe, channel manager at Avaya South Pacific, said the communications vendor was in the process of rejigging the offering for Australia.

"The products outlined are still being regionalised due to Asia-Pacific differences in our go-to-market model. However, we have been supplying our Business Partners with productised Avaya Services offerings for some time," Howe said.

US partners responded variously to the news.

"You can set your own margins," said John Gassert, service manager at PaeTec Communications, a communications VAR in the US.

The services could help fill gaps in resellers' portfolios, said John Black, president of Catalyst Telecom, the Avaya-focused arm of speciality US distributor ScanSource. "Avaya is building services that you might not have the bandwidth or investment dollars to build and selling them wholesale."

Other US partners said Avaya had sent mixed messages about services opportunities for its channel.

"For years, they had told resellers to build their own services and then they tell us to use theirs. Now they're saying that since we have services practices, [there's room for both]," said Jeff Hiebert, chief executive of ROI Networks, another US reseller.

He said some more lucrative opportunities had a mix of partner- and Avaya-provided services where resellers acted as project managers and combined the parts of a service.

D'Ambrosio said Avaya was trying to improve channel sales and partner relations. Another step was the planned June rollout of Avaya's eDemand Program, a closed-loop lead-generation effort, he said.

Partners could find leads in their areas through the eDemand program on a first-come, first-served basis.

"That partner and the salespeople who are actually driving that lead are tracked on their productivity, and then as future leads come in, that will be one of the influencing factors in terms of the distribution of leads," D'Ambrosio said.

Avaya was also still refining a segmented go-to-market strategy it rolled out last year. Under the strategy, Avaya primarily served its top 250 accounts directly and led with channel partners for smaller accounts.

D'Ambrosio admitted some Avaya field personnel had been slow to make the transition and pledged to help improve behaviour in the field. Avaya's direct-sales force got channel-neutral to pro-channel compensation on indirect deals, depending on the size of the account, the size of the partner and the services sold, he said.