The Alliance That Looked Like a Channel
A 60-person risk and compliance consultancy has built a strong reputation with mid-market banks. A GRC SaaS vendor proposes an alliance: 20% referral fee for introductions, or 30% reseller margin if the consultancy takes first-line support and implementation. The vendor wants sector exclusivity for banking and access to the consultancy's client account plans. The consultancy already has a systems integrator partner that implements a competing platform and contributes 18% of revenue. Two clients have asked who would be accountable if the SaaS platform fails an audit. The managing partner sees the alliance as the fastest route to recurring revenue; the delivery director fears margin erosion and brand risk. The vendor's standard contract has no volume commitment, a two-year term, and termination only for material breach.
1. Which alliance model should the consultancy choose, and which terms are non-negotiable?
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Recommendation: start as a referral partner with a funded path to certified implementation, not as a reseller on day one.
Economics first. On a €60k first-year contract, referral yields €12k with little delivery cost. Reseller yields €18k but may consume 100–120 support hours; at €100/hour that is €10k–€12k of cost, leaving thin margin and new liability. Reseller only makes sense if implementation is productised and repeatable.
Non-negotiable terms:
- Client ownership: the consultancy owns the client relationship; the vendor may not market to referred clients without consent.
- Exclusivity with a price: accept banking exclusivity only for a named account list, with a 12-month volume target and automatic non-exclusivity if missed.
- Accountability matrix: who answers audit questions, who configures controls, and who carries liability for misconfiguration.
- Data access: purpose-limited, minimum necessary, no use of client account plans for vendor pipeline.
- Termination: for convenience after 12 months, no auto-renewal, and a clean transition of references and certifications.
This structure captures recurring revenue without turning the consultancy into an unpaid support desk or accepting brand risk it cannot control.
2. The vendor wants banking exclusivity, and the existing systems integrator contributes 18% of revenue. How should rules of engagement be structured?
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Map the accounts before agreeing to exclusivity.
- Account segmentation: classify clients as SI-led, vendor-led, or joint. Exclude SI-led accounts from the vendor exclusivity list; ask the SI to confirm no competing bid on those accounts.
- Deal registration: register opportunities, with a 30-day protection window and a named escalation owner for conflicts.
- No-bid rule: the consultancy will not bid on an SI opportunity involving the competing platform without written consent, and vice versa.
- Compensation split: define referral fees and delivery fees separately; do not let a vendor referral fee cannibalise SI implementation revenue.
- Joint account planning: quarterly review of the top ten accounts, with a documented conflict log.
- Exclusivity test: limit it to a named list and a 12-month volume target. If the vendor misses the target, exclusivity lapses automatically.
This protects the 18% revenue base while giving the vendor a credible route to market. Exclusivity without volume commitment is a one-sided option, and the consultancy would be paying for it with its client relationships.
3. Two clients ask who is accountable if the platform fails an audit. What governance and contract architecture should the consultancy propose?
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Answer the accountability question before signing, not after an audit finding.
- RACI by control: the client owns its control environment; the vendor owns platform operation and evidence; the consultancy owns configuration advice and implementation quality. Put this in a one-page matrix attached to every proposal.
- Evidence flow-down: the vendor must provide current audit reports, control descriptions and breach notifications. The consultancy needs the right to share relevant evidence with clients.
- Contractual limits: do not accept unlimited liability for vendor failure. Cap liability at fees, carve out wilful misconduct, and require the vendor to indemnify for platform defects.
- Client disclosure: tell clients plainly what the consultancy does and does not warrant. Offer a joint audit-response protocol.
- Insurance check: confirm professional indemnity cover before taking first-line support.
This is a trust issue, not a legal formality. Clients are buying the consultancy's judgment; if the consultancy cannot explain where its responsibility ends, it should not take the reseller role.