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Renewal opportunities are not always the easiest to close. They are data-intensive and often require multiple phone calls and reminders up and down the channel for what can be perceived by your partners as a waste of their time (especially if the renewal is small and margins are tight). The more that you, as the vendor, can proactively plan the renewal process, the more likely your channel will be onboard to drive them to closure.
The biggest barrier to successful on-time renewal closure is timing and the notice period. In this post, we provide some guidance for actions to undertake from the beginning of the renewal cycle through to closure.
As most vendor organizations are operating with a single or two-tier distribution model, we always recommend early notification of a renewal. Most companies operate on a 90-day cycle during which the opportunity is created and notification of an upcoming contract expiry is sent to your channel partner. Early notice allows for plenty of opportunity for partners to amend or adjust the quote based on new information from the customer. Our experience is that a vendor should start the process at a 120 days, thereby having plenty of time to have an accurate quote sent or loaded in to your partner before start the search for a quote at 90 days.
If the due date lapses without an order in the system, we recommend that vendors go ahead and switch off the support for that product or end customer. We have found that companies that show that they are serious and value their support generally have a greater success rate for on-time renewals.
Many vendors offer grace periods of up to 30 days after the due date. It is no surprise that vendors that have these sort of policies simply delay their renewal revenues an extra 30 days; while there are exceptions to every rule, we recommend holding the line.
If the renewal is still not ordered after following the processes outlined above, we recommend retiring the renewal opportunity from day-to-day workflows and either handing it off to your net new sales team to re-engage the customer or move it across to a third party for a rescue campaign.
For more information on best practices for processing renewals, download our Secure Your Annual Renewals eBook.
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