Building a Distribution Network for the US Market.
ANZ tech founders often make a dangerous assumption: that their current distribution channels will translate directly to the US market. Here's the reality: your route to market strategy needs a complete rethink for the US.
Understanding the US Channel Landscape
The US market offers multiple routes to your customers, each with its own dynamics. Your choice depends heavily on your product, target market, and resources. Here are the main channels to consider:
Direct sales often seems like the obvious choice for tech companies, but it's expensive and complex in the US. While it gives you complete control over the customer relationship, you're looking at a significant investment in sales teams across multiple time zones and regions.
Value-Added Resellers (VARs) can be your secret weapon in the US market. They already have established customer relationships and can provide local support services. However, they expect margins of 30-40% and need significant support to represent your product effectively.
System Integrators are particularly valuable if your technology needs to be integrated with other enterprise systems. Companies like Accenture or Deloitte can open doors to enterprise customers that would be nearly impossible to reach directly. But remember, they're selective about their partnerships and expect deep technical support.
The Power of Strategic Partnerships
One of the most successful approaches ANZ tech companies eventually get to is the "partnership first" strategy. Rather than trying to build everything from scratch, consider partnering with established US companies that complement your offering. This approach:
Reduces your initial investment
Accelerates market entry
Provides instant credibility
Offers valuable market insights
Common Channel Strategy Mistakes
The three biggest mistakes ANZ tech companies make with their USA distribution are:
First, trying to manage US channel partners from ANZ. You need local presence and support to make channel relationships work. Your partners expect regular interaction and quick response times.
Second, underestimating channel conflict. If you're using multiple channels, you need clear rules of engagement and territory definitions. The US market is highly competitive, and channel conflict can quickly destroy partnerships.
Third, insufficient channel support. US channel partners expect comprehensive support including training, marketing resources, and technical assistance. Budget accordingly.
Building Your Channel Strategy
Here's a practical approach to developing your US channel strategy:
Start with a pilot program in one region with one or two carefully selected partners. This allows you to learn and adjust before scaling. Many successful ANZ companies begin with either the East or West coast, perfect their approach, and then expand.
Invest in channel enablement. Your partners need:
Comprehensive product training
Sales and marketing materials
Technical documentation
Deal registration systems
Clear pricing and discount structures
Consider using channel management platforms to track performance and manage partnerships effectively. The investment in good systems pays off as you scale.
The Path Forward
Your initial months in the US market are critical for establishing your channel network. Focus on building deep relationships with a few key partners rather than trying to sign up as many as possible. Remember that US channel partners have many options; they need to see a clear path to revenue to stay engaged.
Be prepared to adapt your model based on market feedback. The US market moves quickly, and your channel strategy needs to be flexible enough to evolve with it.
Most importantly, don't underestimate the resources required to make channel partnerships successful. Your US channel strategy needs dedicated support, clear communication and consistent investment to deliver results.
The US market represents a massive opportunity for ANZ tech companies, but success depends on building the right distribution network from day one. Take the time to understand the channel landscape, invest in the right partnerships and build for sustainable growth rather than quick wins.
About Pacific Stride
Pacific Stride is a practical bridge to the US market. Filling the gap between government programs and full 'boots on the ground' we provide the strategic guidance, local expertise, and proven frameworks you need to successfully enter and thrive in the North American market. Pacific Stride's team of tech business leaders, with 30+ years experience across all three geographies, help Australian and New Zealand tech companies:
Get on-ground validation - assess regional fit, readiness, and risks before investing heavily in the US marketValidate or co-create go to market plans with a team on the ground.
Understand the market landscape and how best to distribute your product or service.
Power your USA expansion with full access to our sales and marketing support.