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From its inception, DownStream Technologies has been a new kind of software tool company. DownStream’s post-processing tools address one of the most unpopular parts of the design process: documentation. I asked DownStream founder and CEO Rick Almeida to discuss some of his firm’s marketing and sales methods, the trends that he sees, and the influence of the Internet on marketing.
ANDY SHAUGHNESSY: For anyone who may not be familiar with DownStream, give us a quick background on the company and your software tools.
RICK ALMEIDA: DownStream originated through our acquisition of CAM350 from Innoveda, now a part of Mentor Graphics. The founders of DownStream were previously the executive staff of PADS Software and were responsible for much of PADS current PCB technology prior to the sale of PADS to Mentor Graphics. DownStream markets and sells its products in 45 countries through a combination of resellers and direct sales.
SHAUGHNESSY: What is your philosophy regarding sales?
ALMEIDA: The main philosophy, whether dealing direct with DownStream or through one of our resellers, is to understand the customers’ problems first. Not just the technical issues, but the organizational, and financial structures so that we can help our customers configure the right solution that meets all of their needs.
SHAUGHNESSY: Do you use direct salespeople or reps, or both? What are the pros and cons of reps vs. salespeople?
ALMEIDA: We use mostly inside telesales in North America. There are also some key accounts that are managed by a direct sales approach. Everywhere else we use value-added resellers who have exclusive regional territories. This allows them to invest in our products and marketing as they reap the direct benefits from those activities. Using resellers is very economical, as you only incur a cost for sales when a sale is made. However, you must have very good partnerships with your resellers because you are one step removed from the customer base. We’ve had very long and close relationships with our resellers. Many of them we’ve worked with since our days at PADS Software. It’s important when dealing with resellers that you understand their business motivations as well as your own. We’ve seen countless times where companies try to hire resellers and strong arm them to sell certain products that are not really a fit with the resellers business model. In the end, both the reseller and the OEM lose out.
Having direct sales, whether telesales or field direct, saves you the margin you would normally pay to a reseller and gets you closer to the customer. However, managing a hybrid channel typically requires focused channel management to avoid conflict between your direct and reseller channels.
To read this entire article, which appeared in the December 2016 issue of The PCB Design Magazine, click here.