market-research, security, commissionsHi all hope to get some thoughts on my current situation from all of you. I run a cyber security start up offering a SaaS product and was recently approached by another startup requesting to resell my product on their platform (both our companies compliment each other very well).
They want to white label my product (they didn’t specify what they meant but I assume they will be marketing my product without saying its from my company) and they want commission.
Questions:
How much commission should I offer and how should I offer it? The cheapest price plan that my company offers is $18/month. Should I offer a percentage of this monthly payment as commission for life or should I offer a one time payment of maybe $200?
Is there anything wrong/negative with white labelling? Should I be charging for white labelling?
Anything I should include in the contract to protect my company?
Would love your thoughts on this.
You should have a lawyer for this, I think your best option is to make it so that you can change the commission structure on the fly, or at least after a period of time.
You should have commission tiers based on number of sales.
IE:
0-100 units = 10%
101-500 units = 20%
501-1000 units = 30%
1000+ = 40%
In terms of actual % I would say it depends on your overall costs, popularity of the product and competition in the market place.
If I were you I would just ask them how much commission do they want and how much units are they expecting to sell? I would take those numbers as a middle point and build the commission tier around it.
All content is licensed under CC BY-SA 3.0.