SAP to turn mid-market clients over to partners

SAP AG is looking to the mid-market to help pump up flagging revenues.

SAP AG is looking to the mid-market to help pump up flagging revenues.

The enterprise resource planning (ERP) and business applications firmannounced that it would expand its efforts in the mid-market sector by shifting some accounts to channel partners.

SAP partners will now handle all accounts worth $500m (£351m) or less, leaving the SAP internal sales force free to focus on the higher-end market and sell SAP's new customer relationship management and supply chain products. Channel partners currently handle accounts worth $200m (£140m) or less.

The new programme begins on 1 January. SAP will gradually move the accounts worth less than $500m to its seven partners, who will receive special certification to handle software implementations at the larger companies.

While the mid-market category provides SAP with 58% of its revenue, before now the company has not specifically targeted strategic growth area.

"The mid-market is the next battleground for tier one players coming down and tier two and three players coming up," said Allen Brault, senior vice president of the company's domestic small and medium business group.

One analyst noted that SAP's US channel was a "major weak point" for its mid-market strategy, and giving its partners more accounts may not lead to more deals.

"There are some notable exceptions, but most mid-market companies I talk to say that SAP was either a no-show at the bid or simply didn't put forth the effort," said Greenbaum.

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