SAP Takes Aim at the Midmarket

SAP has started investing heavily in its reseller channel for small and midsize businesses.

SAP is taking a page from Microsofts playbook when it comes to selling into the small and midsize business sector.

Bill McDermott, president and CEO of SAP Americas and a corporate officer of SAP AG, said during the companys annual Sapphire user conference in Orlando May 16-18, that the company plans to invest heavily in building out its reseller channel for the SMB market.

"New business models are an area we need to explore, with more effort put into finding more local resellers," said McDermott. "Were going to create a lot of jobs.

SAP sells two separate ERP (enterprise resources planning) suites geared for SMBs: Business One and All-in-One, respectively.

While it has a reseller channel established to some degree, SAP primarily relies on its own sales and support staff to sell into the midmarket.

The problem with the direct sales approach is that the midmarket is typified as large, fragmented and hard to reach. The prevailing theory—particularly with Microsoft, which relies almost exclusively on VARS to sell its small and midmarket ERP software—is that localized resellers, who are familiar with a particular geography and region, sell better into the SMB market.

SAP, it seems, sees the opportunity as well.

"Were investing a lot of money," said McDermott. "This is a big opportunity for SAP. Our ecosystem is wide open; we welcome [VARS] with open arms."


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