Definition
A channel partner is an outside company that helps a vendor sell, deliver or support its products. Common types include resellers, distributors, managed service providers, referral partners and technology partners. The vendor and partner share customers and revenue through an agreed set of rules.
Vendors work with channel partners to reach buyers they could not reach well on their own. Partners often have local presence, trusted relationships and services that the vendor does not offer.
Partners usually earn money through margin, discounts, referral fees or their own services. Most vendors group partners into a formal partner program with tiers, benefits and requirements.
In practice
A small cybersecurity vendor signs a regional IT services firm as a channel partner so the firm can bundle the vendor's email security product into its client contracts.