Dealer reform: shift from volume to quality

Context

Operator with a dealer network of 1500 points. CEO notices: top 10 dealers deliver 40% of acquisitions, but their churn is significantly higher (8% over 90 days vs network 4%). Base survival rate among the top 10 is 15-20pp lower.

Internal politics — top 10 are “key partners”, special treatment. Every reform attempt hits that wall.

CEO asks for an external assessment before the political conversation.

Diagnostic (4 weeks)

The audit showed:

• 4 of the top 10 dealers have clear fraud patterns (documents with one-two IDs, fictitious activations, repeat credential use).
• Their base survival rate — 67% over 90 days (network 88%).
• Net revenue per acquisition after adjustments — 30% below the network.
• Top-10 contracts do not allow commission clawback.

Insight: “top 10 by volume” = “top 4 by reverse impact” + “top 6 normal”.

Approach (12 months)

Months 1-2. Renegotiation of top-10 contracts. Clawback clauses introduced. 6 of 10 signed (incl. 2 of 4 problem ones). 4 refused.

Months 2-4. Composite scoring rolled out across the network. Dealers see their score, network distribution. Tiered access begins (top quality receive exclusive products).

Months 4-8. Deferred commission for all new contracts. 30% upfront, 70% across 30/60/90 days of survival.

Months 6-12. Top 4 problem dealers: 2 left on their own after scoring transparency (could not withstand it), 1 changed approach and passed reform, 1 was disengaged through arbitration.

In parallel — recruitment of 50 high-quality dealers focused on underrepresented regions.

Results

After 12 months:

• Subscription fraud −45%.
• Base survival rate +12pp.
• Commission expense −8% (a large part deferred and saved on fraud cases).
• Network revenue from dealer channel +6% (despite −2 disengaged dealers, new quality ones covered).
• Dealer satisfaction (good dealers) +18 NPS points.

What is critical

CEO public commitment to reform. Without visible top cover any sales executive walks it back.

Phased contract renegotiation. Not all contracts at once — otherwise a unified resistance front.

Transparent scoring accessible to dealers. Transparency creates self-regulation.

New dealer recruitment pipeline. Without it the reform creates a vacuum on the slope.

What would not have worked

Top-down mandate without a contract base. Without legal clarification clawback is simply impossible.

Mass disqualification of all “bad” dealers. Operations disruption, regulator concerns.

Bet only on new dealers without working with existing ones. Existing make up 95%+ revenue, cannot be ignored.

How SamaraliSoft engages

An engagement of this class — 12-15 months. Initial diagnostic 4-6 weeks, contract renegotiation 4-8 weeks, scoring rollout, ongoing operating support.

Related

• /en/solutions/telecom-dealer-management-platform/ — dealer platform
• /en/insights/telecom-dealer-quality-score/ — scoring
• /en/decisions/telecom-brand-store-vs-dealer-expansion/ — channel decision
• /en/insights/telecom-channel-economics/ — channel economics