Tally Bans Dubious AMTPs

The recent move by href="http://www.ciol.com/News/News/News-Reports/Bharat-Goenka-to-tell-the-story-of-Tally/147476/0/">Tally
Solutions to
ban the Associated Master Tally Partners (AMTPs), who are involved in
unfair trade practices, has created ripples in the market.
Apparently, most of the partners are in the state of shock and
disbelief. They feel that this step from such a reputed vendor is
very irrational and abrupt. However, Tally maintains that it has
taken a right and corrective decision, as the company has found that
in the last one year or so, most of these AMTPs were selling Tally
products at a discounted rate against those fixed by the company.
Besides, they were not abiding to the rules of the company and their
action was not in synergy in the way the company operates.

Shoaib Ahmed, President, Tally
Solutions, pointed out, “We have realized that most of the AMTPs
are not adding value to our business. If they are eroding the price
in the market, then we are going to be extremely hard on them. They
left us with no choice and if we don't address this problem now, then
we are only going to kill ourselves. And that's what prompted us to
put a check on them. We had on the list around 100 AMTPs but this
number has come down considerably. Actually, till date they are still
operating but not doing much business.” According to Tally, AMTPs'
actions were leading to the poaching of Tally Partner (TP) channel
from the entire ecosystem, making it very difficult from the Master
Tally Partners (MTPs) to do business with TPs who are directly attach
with them as well. AMTPs' intention is to get the entire business.
This is making the entire market condition difficult. Also, the
buying price of the TP is getting affected. “Our entire channel
ecosystem is
being questioned now. The second problem is that AMTPs were not
distinguishing between the phone calls they were getting from
channels (TPs) or customers. This was leading to the problem that
they were giving one rate to the whole market. Therefore, a customer
would directly go to an AMTP bypassing the TP and getting the product
at a price lower than the TPs buying price,” added Ahmed.

Tally has a 2-tier partner model, it
has 140 MTPs. A MTP typically recruits, enables and manages Tally
Partners (TP) who are the secondary channels that reach out to
customers. MTPs are equipped to sale and support, thus adding a whole
lot of value to the channel. It has currently around 16,700 TPs
across the country. It also has a middle level of partner called AMTP
who is (typically) a hardware distributor, catering to B-class
cities. AMTPs are the subsets of MTPs. The company has been engaging
with these AMTPs for the last two-and-a-half-years. On the other
hand, most of the AMTPs feel that by making them an AMTP, Tally has
got hold of their database and now with this sudden decision, it is
poaching their database. This whole issue has lead to a betrayal of
trust between Tally and AMTPs. Moreover, the fallout of this action
will be that the AMTPs will lose out 10 percent margin that they were
getting by selling Tally products.

Miffed with Tally's decision, Manoj
Bagdiya, CEO, Compute and Compile, Rajkot, said, “Tally has
discontinued us without giving any notice. My clients have been asked
not to deal with us, as they will deal with Tally directly. Earlier,
Tally has forced us to become their AMTP but they have taken this
decision without giving any clarification or reasoning to us. Nothing
has been conveyed to us from Tally. You can't fight the vendor
company on an individual basis. They are just using our database now
which has lead to a breach of trust.”

Seconding his views on the same, K
Narayan Rao, CEO, Matrix Technologies, Bengaluru, added, “I am not
sure about their reasoning behind taking such a drastic step. What I
feel that Tally keeps on changing their policies quite often. It look
like that Tally's intention was to get hold of our database. We did a
mistake by becoming the AMTP. There is a complete betrayal of trust,
as Tally will eat up our margins now.” Nonetheless, it is not an
abrupt or sudden decision taken by Tally. In June last year, it had a
dialogue with AMTPs, wherein it tried to convince them. The company
clearly conveyed this to the AMTPs that if they act in such a manner
then it will not let that continue. But it seems the AMTPs did not
adhered to the company's policies and that's what compelled Tally to
take such an action.

“AMTPs are losing 10 percent margin
because they have misused it. They thought that it is their birth
right to give discount. It has not happened over night but it's being
repeated over a period of time. But I don't blame them as it's a
small business for them and it's convenient to do this. It's been
happening for almost a year now and in the last six months, we have
been very actively working on this,” added Ahmed. Meanwhile, Tally
hasn't banned all the AMTPs. It is taking action against only those
AMTPs who are causing problems in its business. The company wants
these AMTPs to operate within its pricing strategy.

Supporting Tally's cause,
Chandigarh-based Sanjeev Walia, CEO, Jetage Computer Traders, who is
also an MTP for Himachal Pradesh and Chandigarh, believes that Tally
has taken an absolutely right decision. These AMTPs were not sincere
with the company as compared to MTPs. AMTPs were selling the products
at a lower price and were involved into number game. Besides
maintaining the price in the market, these AMTPs have to also
maintain the decorum and follow the norms of the company. Tally's
decision is totally appreciated by MTPs.