The Covid-19 crisis is forcing most software providers in the Hospitality Tech industry to change their long term strategy. Cash flow seems to be an immediate challenge for hotels and this causes problems for serious software providers. The lack of cash has forced many hoteliers to request a delay in payment or a temporary suspension of the software fee. Many of these providers however, rely solely on the monthly payments from their current clients.
Lots of companies in Hospitality Tech are VC funded or on a mission to be VC funded, so we’ve seen most of them working an aggressive sales strategy in order to achieve the necessary growth year on year. But in a crisis, there is one major problem with this strategy: cash. All the money that comes in, is immediately pumped in the company again, in the form of large sales teams (and their bonuses) to achieve the projected growth. But with cash drying up, it seems this model is no longer sustainable.
Relieving the company of these salaries is a huge cost saver and a very effective short term measure. It's painful, but effective. In addition, there is almost no demand. Hoteliers are struggling to survive and postponing any investments in software. So, the first teams that have to go are the commercial teams. The little cash there still is, is better spent on improving the product during this downtime. However, even though demand has probably never been so low, new business is still necessary and welcome. So, the question arises: Is there another way to make sure that every opportunity is still seized, but without the fixed costs or salaries? The short answer is yes!
Including Partnerships as part of your business strategy has never been more important. It has been already proven many times that, if done right, Partnerships can achieve amazing growth numbers (here is a great article on how to do it right). Partners can help you achieve or increase brand awareness, enter new markets, provide hot leads, help you close deals and much more. There are a lot of different programs out there, and all of them have their pros and cons. However, what the programs all have in common, is that you pay based on results. There is no need for a major upfront investment, all you need is time to work out a proper strategy upfront, to set it up and implement it and to scale it up.
In this time where there is a shortage of cash but an abundance of time, it is of utmost importance to start thinking about which Partner Program suits your business. Because one thing is for sure, a Partner program increases your chances to weather this storm and it will make you come out of it even stronger.
If you want to receive more news alongside tips and tricks about Partnerships, sign up to our newsletter here!