Pay your channel for the selling you actually want.
Gully Sales designs what your dealers, distributors and resellers earn and what they must do to earn it, then models every rate, slab and rebate against your own order history before a single scheme circular goes out.
- One earning structure, written down, that every partner is measured by.
- Slabs and rebates costed on your own data before you announce them.
- Controls against stock loading, claim inflation and quarter-end dumping.
Gully Sales Private Limited designs partner earning structures for Indian SMBs selling through dealers, distributors, resellers and referral partners.
In one paragraph
What is Partner Compensation and Incentive Design?
Partner compensation and incentive design sets what your dealers, distributors and resellers earn and the behaviour that earns it. Gully Sales fixes the pay mix, the measures, the thresholds and the accelerators, models every rule against your own order history, writes the controls that stop gaming, and hands you scheme documents your partners and your accounts team can both work from.
The problem
Your channel margins were negotiated, not designed.
Most Indian SMBs did not decide their partner margins. They inherited them. A dealer negotiated two extra points in a bad quarter. A distributor was promised a year-end rebate to keep him from switching. A festival scheme never quite ended. None of it was wrong at the time. Together it has become an earning structure that nobody designed, that costs real money every month, and that no longer tells a partner what to do to earn more.
You will recognise it as
- You cannot say, without opening a file, what your largest distributor will earn on this year's business.
- Rebates are settled by negotiation at year end, and the figure moves depending on who calls first.
- Orders arrive in a rush in the last week of the quarter, and returns arrive in the first week of the next.
- A discount given to win one order quietly becomes the rate that partner expects on every order after it.
- Two partners doing similar business earn very different percentages, and both believe they are underpaid.
- Your scheme and rebate spend rises faster than channel revenue, and nobody can point to what it bought.
What it costs the business
- Money meant to buy growth buys volume you would have received anyway, because the slab starts below what the partner already sells.
- Sales that look like demand are stock sitting in a partner's godown, and the next quarter opens with a hole in it.
- Steady partners quietly subsidise loud ones, and the steady ones are usually the first to drift to another brand.
- Your team spends the quarter arguing about claims instead of selling, and finance closes the books late and short.
Why it persists. Channel money is hard to change because every line of it has a face attached. Cutting a partner's margin feels like risking the revenue he carries, so the easier route is always to add: a scheme this festival, a special rate for that account, an extra point for the man who threatened to leave. Each addition is small and defensible on its own. Nobody sees the whole picture, because the whole picture has never been put on one sheet of paper.
If it stays unresolved. The structure keeps growing outwards. More schemes, more exceptions, more claims to verify, and a payout percentage that ratchets up and never comes down. Eventually the loudest partners set your pricing, the steady ones move to a brand that pays them on stated rules, and you are funding a network that has stopped growing.
What changes
Partners earn more by selling what you actually want sold.
In the first weeks
- You see on one sheet what every partner earns today, and what each rupee of it is buying.
- Scheme announcements stop being drafted in a hurry, because the structure they sit inside is already agreed.
In how the work runs
- Claims are settled against stated rules and named documents, so the monthly argument gets shorter.
- Your sales team can answer a partner's earning question in the meeting instead of escalating it to you.
- Finance can accrue for rebates through the year instead of discovering the bill in March.
In sales and marketing
- Incentive money is aimed at what you are short of: new counters, wider range, collection on time, real sell-out.
- Thresholds sit above what a partner already does, so growth money is paid for growth.
- The plan's cost is known at low, expected and high performance before it is announced.
In what management can see
- Partners know before the year starts what reaching the next slab requires, and where they stand at mid-year.
- You can compare payout, margin and contribution across the whole network in the same units.
Over the longer term
- The plan is recalibrated each year against actual results instead of being rebuilt in a panic.
- Partner conversations move from what they want to what the plan pays for.
Gully Sales controls the design work: the structure, the modelling, the documents and the rollout support. What partners then do with it also depends on your product, price, supply and service. We build a plan that rewards the behaviour you need; we do not promise a revenue figure from it.
Who it is for
This work fits businesses that already sell through partners.
The businesses it suits
- Manufacturers and brands selling through dealers, distributors or stockists across one or more states.
- B2B companies whose resellers, system integrators or channel partners carry part of the revenue.
- Franchisors paying franchisees, area developers or master franchise partners on performance.
- Businesses running referral or introducer partners paid per lead, per meeting or per closed order.
- Companies whose scheme spend has grown for two or three years without a matching rise in channel revenue.
- Teams planning the coming year who want the earning structure settled before targets are announced.
What usually prompts the call
- You are about to announce a new year's scheme while last year's is still being argued over.
- A large partner has asked for a special rate and you have no principle to answer him with.
- Sell-in and sell-out have drifted apart, and quarter-end orders are followed by returns.
- You are adding a partner type, an online seller or a referral network, and the old margin does not fit.
- Finance has flagged that discounts, credit notes and schemes together cost more than anyone budgeted.
What Gully Sales does
The work, component by component.
Role objectives for each partner type
We begin by writing what each kind of partner is actually being paid to do. A stockist is paid to hold range and reach counters your team cannot reach. A reseller is paid to find and close new customers. A referral partner is paid to introduce, not to service. Where one rate is being paid to all of them, we separate them and say what each is for.
- Why it matters:
- A single margin paid to everyone rewards the easiest behaviour, which is usually a repeat order from an account that would have ordered anyway.
- You receive:
- A one-page statement of purpose, expected behaviour and earning logic for every partner type.
- Business value:
- Every rupee in the plan has a job, and you can state out loud what that job is.
Pay mix: margin, rebate and incentive
We split partner earnings into their parts: the front margin taken on the invoice, the rebate earned on performance over a period, and the discretionary incentive kept for specific pushes. We set how much sits in each part by partner type and tier, and show what your own margin looks like after all three are paid.
- Why it matters:
- When everything sits in front margin, a partner earns the same whether he grows or coasts, and none of the money can be steered.
- You receive:
- Pay mix table by partner type and tier, with your landed margin modelled beside each level.
- Business value:
- A base a partner can run his business on, and a portion you can still aim at growth.
Measures the plan pays on
We choose what earning is calculated on and define each measure precisely: secondary sales rather than primary billing where you can read it, range or category width, new counters opened, collection within terms, or qualified introductions for referral partners. Every measure gets a written definition, a data source, a cut-off and an owner.
- Why it matters:
- Most channel disputes are not about the rate. They are about whose number is right and what was allowed to count.
- You receive:
- A measure dictionary with definition, calculation, data source and the report each is read from.
- Business value:
- Both sides arrive at the same figure from the same data, so payout stops being a negotiation.
Thresholds and slabs
We set where earning begins and how it steps up. Thresholds are placed against each partner's own recent performance and market potential rather than one number for the whole network, so a growth slab is not paid on business that was already coming. Slab widths are tested so the next step stays within reach of an ordinary year.
- Why it matters:
- A threshold set too low pays for the past. One set out of reach is ignored by the partner from the first month.
- You receive:
- Slab grids by partner segment, with the threshold rule and the arithmetic that placed each one.
- Business value:
- Growth money is spent on growth, and partners see a target they can believe is reachable.
Accelerators and time-bound pushes
We design the upper end of the plan: an accelerated rate once a partner passes stretch, and bounded pushes for a new product, a slow-moving category or an under-covered territory. Each one is written with an entry condition, a ceiling, a funding source and an end date, so a temporary push does not become a permanent expectation.
- Why it matters:
- Open-ended schemes are where the largest unplanned payouts come from, and they are usually noticed only after the money has been earned.
- You receive:
- Accelerator design plus a scheme template carrying entry rule, cap, funding source and end date.
- Business value:
- You can push hard on one product or territory without losing control of the annual payout.
Controls against gaming and leakage
We write the rules that keep the plan honest: sell-out based measurement where the data allows, aggregation rules so a group cannot cross slabs by splitting orders across firms, returns and cancellation adjustments, collection conditions, cross-territory dumping checks, and a claim process with named evidence, timelines and a verification step.
- Why it matters:
- Any plan can be gamed. The real question is whether the routes were thought about before the year started or after the money left.
- You receive:
- Control rulebook, claim and verification process, and an exception matrix with approval limits.
- Business value:
- Payouts reflect business that was real, retained and collected, not stock moved at quarter end.
Modelling, documents and rollout
We run the whole plan over your last two or three years of partner-level data: what each partner would have earned, what the total payout would have been, and how that figure moves in a weak year and a strong one. Then we write the partner-facing scheme, the internal calculation workings and the plan for announcing it.
- Why it matters:
- A plan that has not been costed against real history is a commitment made with an unknown number attached to it.
- You receive:
- Payout model at partner and network level, scheme circular, internal workbook and a rollout pack.
- Business value:
- You approve the structure already knowing what it costs at three levels of performance.
What you will have at the end.
- Current-state sheet: what every partner earns today across margin, schemes, credit notes and rebates, on one comparable basis.
- Cost-of-channel analysis: total partner cost as a percentage of channel revenue, by partner, segment and territory.
- Role and objective statement for each partner type, saying plainly what the plan pays that partner to do.
- Pay mix table by partner type and tier, with your margin after partner cost modelled at each level.
- Measure dictionary: definition, calculation, data source, cut-off and owner for every measure in the plan.
- Threshold and slab grids set against each partner segment's own baseline and market potential.
- Accelerator and scheme template with entry conditions, caps, funding source and end dates.
- Control rulebook covering aggregation, returns, collection, territory and claim verification rules.
- Claim and settlement process with forms, required documents, timelines and approval limits.
- Payout model in a working sheet showing partner-level and total cost at low, expected and high performance.
- Partner-facing scheme document in plain language, ready to circulate across your network.
- Rollout pack: announcement note, partner briefing deck, objection handling and the review calendar.
How it runs
The engagement, step by step.
- 1
Discovery and data pull
We sit with your sales and accounts teams and collect what actually happens: the stated margins, the unstated ones, every running scheme, and two or three years of partner-level sales, credit notes and collections. Unwritten arrangements matter here more than documents do.
- You provide:
- Partner-level sales, discount, credit note and collection data, plus current scheme circulars and agreements.
- We produce:
- A data request list, then a cleaned partner-level base file your team has checked.
- Done when:
- The numbers reconcile with your books and your team agrees they are right.
- 2
Cost of the present plan
We calculate what your channel costs today: front margin, schemes, rebates, credit notes and settlements added together as a percentage of channel revenue, by partner, segment and territory. Most owners see this number in one place for the first time at this step.
- You provide:
- Agreement on which spend categories belong in the figure, including anything held outside the sales ledger.
- We produce:
- A cost-of-channel analysis with the outliers named and explained.
- Done when:
- You can see which partners are expensive, which are cheap, and why.
- 3
Design workshop
We work through the choices with you: what each partner type is paid to do, how much sits in margin against rebate, what the plan pays on, and how hard the thresholds should be. Every choice is made against the numbers on the table rather than in principle.
- You provide:
- A few hours from the people who own channel decisions, with finance in the room.
- We produce:
- A design decision record and the first draft of the structure.
- Done when:
- The structure is agreed in outline and its intent is written down.
- 4
Modelling and stress testing
We run the draft plan over history, partner by partner: who gains, who loses, where the cost lands, and where the plan could be gamed. Rates, thresholds and caps are adjusted until the plan stays affordable in a weak year and remains worth chasing in a strong one.
- You provide:
- Your budget for channel cost and your tolerance for partner-level change.
- We produce:
- A payout model with scenarios and a written list of the leaks that were closed.
- Done when:
- The plan's cost is known at three levels of performance and approved.
- 5
Rules, controls and documents
We turn the design into documents people can act on: the partner-facing scheme in plain language, the internal calculation workings, the claim process with its forms and timelines, and the exception matrix that says who may approve what.
- You provide:
- Review from finance and, where you need it, from your legal or tax adviser.
- We produce:
- Scheme document, internal workbook, claim process and control rulebook.
- Done when:
- Sales and finance can both run the plan without coming back to us.
- 6
Rollout and partner communication
We help you announce it. Partners are briefed by segment, with the change explained in terms of what it means for them. Partners who earn less under the new structure are handled separately, with a transition path rather than a surprise in a circular.
- You provide:
- The briefing calendar and the people who will carry the message to partners.
- We produce:
- Announcement note, briefing deck, objection handling notes and a transition plan.
- Done when:
- Every partner has been told, in the same words, what changes and from when.
- 7
First review cycle
We stay through the first full measurement period. Claims are checked against the new process, disputes are traced back to the rule that caused them, and anything ambiguous is rewritten. This is where the plan stops being a document and becomes the way business is done.
- You provide:
- The first period's payout data and the disputes as they come up.
- We produce:
- A first-cycle review with rule amendments and a calibration note for next year.
- Done when:
- The first payout is settled under the plan and every exception is documented.
Ways to work with us
How the work is shaped around what you already have.
Channel pay audit
A read of what your partner network costs you today and where the money leaks, delivered as a findings sheet with the changes worth making. Useful when you suspect the number but cannot see it.
Plan design and modelling
The full design: role objectives, pay mix, measures, thresholds, accelerators and controls, with a payout model tested against your own partner history.
Design with rollout support
The design work plus the partner-facing documents, the announcement, briefing support and the transition handling for partners whose earnings change.
Annual reset and calibration
For businesses whose structure is already sound: we recalibrate thresholds and rates against the year's results and rewrite the scheme for the coming year.
Why Gully Sales
What you are actually choosing when you choose us.
We model before you announce.
Every rate, threshold and cap is tested against your own partner-level history before it reaches a partner. You approve a plan whose cost you already know at low, expected and high performance.
The plan is built for Indian channel conditions.
Sell-in and sell-out gaps, credit and collection cycles, scheme circulars, credit-note settlements and family-run partner firms are the conditions the plan is designed for, not exceptions bolted on afterwards.
Sales and finance are both in the room.
A plan the sales team likes and finance cannot settle fails by the second month. We write measures, claim processes and accrual rules that both functions can work from without translation.
Controls are written with the rates, not after them.
Aggregation, returns, collection, territory and verification rules are designed alongside the slabs, so the routes to gaming the plan are closed before the year starts rather than after a payout surprises you.
The plan is handed over, not held.
You receive the model, the workings, the documents and the process in formats your team can edit. Running next year's plan does not depend on us being available.
We read the whole revenue system.
Gully Sales works across marketing, sales, channel, customer success and revenue operations, so a channel pay problem is read alongside pricing, coverage and demand rather than in isolation.
Where it applies
The same service, in different businesses.
Building materials and hardware
- The situation:
- A fittings brand sells through dealers in four states. Margins were set state by state over a decade, and the two oldest dealers now earn several points more than everyone else for reasons nobody can reconstruct.
- How it applies:
- Role objectives separate stocking dealers from project-facing dealers, thresholds are set on each dealer's own baseline, and the historic extra points are converted into a rebate that has to be earned.
- Likely benefit:
- Support follows performance rather than history, and newer dealers can see a route to the same earnings.
Industrial equipment and components
- The situation:
- Distributors order heavily in March and return material in April, so the year closes well and the new one starts short. The annual rebate rewards billing, so there is no reason for them to stop.
- How it applies:
- Measurement moves to secondary sales where the data allows, returns are netted against earned rebate, and the annual slab is split into quarterly gates that cannot be made up at the end.
- Likely benefit:
- Reported sales move closer to real consumption, and the first quarter stops opening with a hole.
Packaged foods and consumer goods
- The situation:
- Scheme circulars go out most months. Nobody can total what the year's schemes cost, and distributors have learned to wait for a new one whenever growth slows.
- How it applies:
- Recurring schemes are folded into a standing slab structure, and only genuine pushes remain as time-bound schemes with entry conditions, caps and end dates.
- Likely benefit:
- Scheme spend becomes a budget with a shape, and distributors plan against a structure instead of waiting for the next offer.
IT products and software resellers
- The situation:
- Resellers earn the same margin whether they bring a new customer or renew an existing one, so renewals are serviced well and new business has stalled.
- How it applies:
- The pay mix is rebalanced: a lower base on renewals, a higher earned rate on new customers, and a separate rate for partners who deliver implementation and support.
- Likely benefit:
- Partner effort moves towards the business you are short of, without raising total payout.
Healthcare and medical devices
- The situation:
- Channel partners sell to hospitals over long cycles, but earning is paid on billing alone, so partners chase quick reorders and new accounts are left to the company team.
- How it applies:
- Measures are extended to new account activation and installed-base servicing, with payment realisation made a condition of the rebate rather than an afterthought.
- Likely benefit:
- Partners are paid for building accounts that pay, not only for whichever order closes fastest.
Referral and introducer networks
- The situation:
- Introducers are paid a flat fee per lead. Volume went up, quality went down, and the sales team quietly stopped following the introductions up.
- How it applies:
- Payment moves down the funnel: a small amount on a qualified meeting and the larger share on a closed and collected order, with a definition of qualified that both sides sign.
- Likely benefit:
- Introductions become worth working, and your cost per closed order becomes something you can predict.
Questions buyers ask
Before you enquire, the answers you will want.
How will the plan reward the right behaviour without partners gaming it?
We design the controls with the rates, not afterwards. Earning is measured on secondary sales where the data allows, orders from related firms are aggregated so slabs cannot be crossed by splitting, returns and cancellations are netted off, and the rebate is conditional on collection within terms. Claims follow a documented process with named evidence and a verification step. No plan is impossible to game, but the common routes can be closed before the year starts.
How long does the engagement take?
It depends on how many partner types and territories the plan covers and how quickly partner-level data can be pulled. The sequence stays fixed even when the pace does not: data and current-cost analysis, a design workshop, modelling against your history, documents and controls, then rollout and the first review cycle. We agree milestones and review points in writing at the start, and we avoid quoting a fixed number of weeks before seeing the state of your data.
What inputs are required from us?
Partner-level sales, discount, credit note and collection data for the last two or three years, your current scheme circulars and dealer agreements, and the targets or budget for the coming year. Beyond data we need time from the people who own channel decisions, finance included, and someone willing to describe the unwritten arrangements. The plan is only as sound as the honesty of that first conversation.
How is success measured?
Against the baseline we fix before anything changes. The plan is working when channel cost as a percentage of revenue holds steady or falls while partner-sourced business grows, when more partners cross the first slab, when claims settle inside their timeline with fewer exceptions, and when sell-through moves closer to billing. We report these each quarter alongside the season and any pricing or supply change that also moved the numbers.
What is excluded from the scope?
We design and document the plan; we do not run your payouts, issue credit notes or act as your channel accounting team. Recruiting partners, building a partner portal, planning trade promotions and administering market development funds are separate pieces of work, though the plan is written so they sit alongside it cleanly. We also do not set your product pricing, though we will tell you when the margin cannot fund the plan you want.
Will partners accept a plan that pays some of them less?
Some will resist, and it is better to plan for that than to hope. We identify every partner whose earning changes before the announcement, so each conversation is prepared rather than reactive. Larger reductions are usually phased, with a transition period or a protected floor for a defined time. In our experience partners accept structure far more readily than surprise, particularly when they can see the same rules applying to everyone.
Should incentives be paid on primary or secondary sales?
Pay on what you want to happen, and measure what you can actually read. Primary billing is easy to verify and easy to inflate at quarter end. Secondary sales reflect real consumption but need data from partners, which not every network supplies reliably. In practice we often split it: a base earned on billing, and the growth portion earned on secondary or stock-adjusted numbers, with the reporting built to make that possible.
How much should sit in front margin and how much in rebate?
There is no single correct split, but the principle holds. The base should be enough for a partner to run his business on, and the variable portion large enough that reaching the next slab is worth real effort. Too much in front margin and you cannot steer behaviour at all. Too little and partners push the competing brand that pays on the invoice. We model both sides at every tier before recommending a mix.
4 more questions
We already have a partner programme. Do we need this as well?
If your programme already states clearly what each partner earns, on what measure, at what threshold, with the controls and claim process written down, you may only need an annual calibration against this year's results. Programme design sets the shape of the network: partner types, journey and governance. This work sets the money inside that shape. Many businesses have the first without the second, and that gap is where the leakage usually sits.
Can this work for a small network of eight or ten dealers?
Often yes, though the work is lighter. With a small network the value lies less in elaborate tiers and more in writing down one consistent structure, defining the measures, and closing the obvious leaks. If you have three or four partners and speak to each of them every week, a formal plan may be more machinery than you need, and we will say so rather than build it.
What about incentives for the partner's own salespeople?
Distributor and dealer salespeople often decide which brand gets pushed, so schemes aimed at them can work well. They also need care: they sit outside your payroll, the money can be held back by the partner, and the tax treatment differs. Where it fits, we design them as a defined and capped part of the plan with direct verification, and we say plainly when the partner principal should be the one paid instead.
How often should the plan change?
The structure should hold for a year, and the numbers inside it should be recalibrated annually against actual results. Changing rates mid-year teaches partners to wait for a better offer instead of selling. Time-bound pushes are the exception, and they belong inside the plan as scheme slots with caps and end dates rather than as fresh negotiations. A stable structure with a predictable annual reset is easier for everyone to sell against.
Talk to us
Model the next scheme before you announce it to your partners.
The first conversation is a conversation, not a pitch. Tell us how your partners earn today and what is worrying you about it, and we will tell you whether this work is worth doing for you.
- No obligation and no sales script
- A reply from someone who does the work
- Your details are never sold or shared