There is a vanity metric that plagues almost every software company with a channel program. It is the number of partners you claim to have. It looks great on a slide deck to say you have 500 resellers globally, and it certainly makes any investors feel secure about your market reach. However, as we start 2026, you need to ask yourself a difficult question regarding those 500 partners. How many of them actually sold a license last year?
Having spent years on the other side of the table as a VAR, I can tell you that we often signed up for partner programs just to get a discount on a single deal or to put a logo on our website to look impressive to a specific prospect. After that deal closed (or failed), we often ghosted the ISV (not out of malice; it’s just we had to quickly move on to the next opportunity or threat). If you look closely at your own channel list, you will likely find that the Pareto Principle is optimistic. It is rarely 80/20. It is usually 90/10. Ten percent of your partners are generating ninety percent of your revenue, yet your channel managers are likely spending half their week chasing the other ninety percent who have no intention of selling your software.
The cost of the “zombie” partner
You might think that keeping inactive partners on the list is harmless. You might believe that it costs you nothing to keep their account active in the portal “just in case” they bring in a deal. This is a fallacy. Inactive partners are a drain on your resources. They consume administrative time, they skew your forecasting data, and they dilute your brand.
Every hour your channel account manager spends trying to “re-engage” a partner who hasn’t logged into the portal since 2024 is an hour they are not spending with a top-tier partner who is trying to close a massive deal. Furthermore, “zombie” partners can be a liability. They often have outdated marketing materials on their websites, they likely haven’t kept up with your technical certifications, and they may be misrepresenting your product’s current capabilities to the market. January is the time to clean house.
Conducting the audit
If possible, pull a report that filters your partners by three criteria: revenue generated in the last 12 months, technical certifications held, and portal login frequency. If a partner has zeroes across the board, they do not belong in your active tier.
Do not just look at revenue. Sometimes a partner is active but struggling, and those are the ones you want to save. Look for engagement. If a partner is logging in, downloading white papers, and attending your webinars (but hasn’t closed a deal yet), they are worth your time. If they are radio silent and generating zero revenue, you need to make a decision.
Demotion vs. termination
“Firing” a partner sounds harsh, and in the polite world of the IT channel, we rarely send a “you are terminated” email. Instead, you should restructure your program tiers to reflect reality. Create a “Registered” or “Community” tier that has zero benefits beyond basic access to the resale price list. This tier should get no MDF (Marketing Development Funds), no dedicated account manager, and no lead distribution.
Move your non-performers to this bottom tier. Send them a polite notification that due to volume requirements, their status has changed. This effectively automates their management. If they want to get back to the Silver or Gold tier, the burden of proof is now on them to bring you a deal. By moving the bottom 80% to a self-service model, you free up a massive amount of human capital.
Doubling down on the middle class
Once you have cleared the noise, you will see your channel clearly. You have your superstars at the top who don’t need much help, and you have the “middle class” of partners. These are the firms that sold two or three deals last year but have the potential to sell ten.
This is where your channel managers need to live in Q1. Take the MDF budget you saved from the zombies and pour it into this middle group. Offer them co-branded marketing campaigns, free training for their new technicians, or an increased margin for their next three deals. When you stop trying to be everything to everyone, you can finally be a strategic partner to the few who actually matter to your bottom line.
