With rapid technology advancement, the Channel has to be more tech-savvy than ever

N R Panicker, 
Chairman,
ACCEL Ltd

I have been an entrepreneur since 1991 and was a VAR and System Integrator back then. I started a small services company at a time when there were many companies but not many products like we see today. Over the years, I have seen many dealers and value-added resellers come up, only to suddenly disappear. Distributors, however, have continued to survive. This scenario continues even today. In the last three to four years, I have seen several companies emerge and then suddenly shut down for various reasons. Accel has managed to survive for 34 years—which I think is a long time—despite being a small company.

Dealers and SIs suffer the most in the entire ecosystem because they are the ones selling directly to the end user. Many times, even when they secure orders, their payments get stuck. The unfortunate truth is that there is no one to protect the interests of these dealers and SIs. So, the most important factor for survival is discipline.

Another key factor is that channel partners must be technologically savvy. They should not cut corners and must take the business seriously, because there are no shortcuts to profits. Also, when you sell software or hardware to a company and a certain amount comes into your bank account, please remember that is not your money. That money belongs to the distributor or the OEM, and you must pass it on. If your margin is 2%, then only that 2% is yours to use. A steady cash flow ensures a stable business. The money you are left with at the end of operations is the real profit you have.