IT and Business Insights for SMB Solution Providers

Tech Data is Prodding SMB Resellers Down the Road to Next-Generation Opportunities

As the distributor transforms itself to meet the demands of a new era in IT, it’s urgently encouraging its partners to do the same. Last week’s Channel Link conference provided the latest venue for those efforts. By Rich Freeman

Tech Data Corp. has a pretty clear vision of the future it must build for itself. To remain relevant amid the transition from “2nd generation” client/server technologies to “3rd platform” markets like cloud computing and the Internet of Things, the company believes, it must shift from supplying shrink-wrapped products alone to delivering solutions and services targeting specific business outcomes as well.

Now it just needs to get to its resellers bought into coming along for the ride.

“We’re long past the bank and warehouse mindset,” said Marc McClure, senior vice president for U.S. commercial sales at Clearwater, Fla.-based Tech Data in an interview with ChannelPro last week at the distributor’s Channel Link conference in Austin, Texas. “We’re undergoing a transformation, and we need the partner base and the community to undergo this transformation as well.”

For the moment—and as fellow distributor Ingram Micro Inc. is discovering as well—that effort remains an exercise in persuasion.

“Fundamentally, if we don’t get our partners to change, we’re at risk,” McClure says. “It’s incumbent upon us to continue to evangelize and help them understand where that market opportunity is and compel them to want to do something about it.”

Channel pros who decline to embrace that opportunity will still have a place in the Tech Data family, he continues. The hope, however, is that such partners will be few in number.

“We’re not distancing ourselves from any of our customers, but we’d rather encourage them to take advantage of the new growth opportunities that exist,” McClure states.

Those opportunities are vast, according to Andrea Miner, director of business intelligence for corporate strategy at Tech Data, who discussed the topic during a Thursday morning keynote. Citing data from IDC, Miner said that global 3rd platform spending will expand at a 12 percent CAGR over the next three years to $239 billion, with net new outlays totaling $66 billion this year alone. 2nd platform products, meanwhile, will slowly account for a declining percentage of IT budgets.

“As that pie shrinks you’re fighting to get a bigger piece,” McClure observed during his own keynote last week. “The ability to remain profitable becomes much more of a challenge.”

Same goes for Tech Data itself, which is why the distributor is investing heavily in initiatives aimed at helping SMB resellers remake themselves as specialists in next-generation technologies.

As ChannelPro wrote in May, Tech Data’s “Practice Builder” program, which guides partners through the process of planning and launching 3rd platform business ventures, is a major component of those investments. Practice Builder sessions, however, are hands-on, months-long engagements too labor-intensive to scale broadly—the company will conduct about 40 in al of North America this year, for example, with partners entering the Internet of Things market.

To help larger numbers of channel pros build next-gen solution practices, Tech Data has created a self-paced training and enablement portal named LevelUp. Opened to the elite members of the TechSelect partner community in May and rolled out more widely last month, the new site draws heavily on Practice Builder’s tools and methodologies.

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