Integrating Avnet Technology Solutions (ATS) with Tech Data Corp., the $26+ billion a year distribution giant and 107th name on the Fortune 500, was bound to be a lengthy process. According to Joe Quaglia, Tech Data’s president for the Americas, however, that complex undertaking is making solid progress.
“We’ve stated from the beginning that this is about a two-year journey,” he says. “All indications that we’ve had up to this point are that we’re either on track or ahead of schedule based on that plan.”
That journey, which began last September with Tech Data’s stated intention to purchase ATS for $2.6 billion, reached its latest milestone two weeks ago, when the Clearwater, Fla.-based distributor officially retired the last vestiges of the ATS brand. Going forward, Tech Data’s now fully merged offerings will be organized principally around a vast endpoint solutions portfolio encompassing its legacy hardware and software catalog and a new advanced solutions portfolio with specialized SKUs and skills for the data center and next-generation technologies like cloud computing, analytics, and the Internet of Things.
That emphasis on so-called “third platform” markets hardly makes Tech Data unique among big-time distributors. Irvine, Calif.-based Ingram Micro Inc. is making major investments in an increasingly sophisticated cloud computing platform, and SYNNEX Corp., of Fremont, Calif., is rolling out a carefully curated advanced solutions portfolio of its own. Quaglia, however, contends the ATS acquisition enables Tech Data to offer a combination of breadth and depth none of its rivals atop the distribution pyramid can match.
“We believe that we have the best end-to-end portfolio of products, solutions, and services in the market today,” he says. “It’s the combination of this deep skill set [from ATS] and this end-to-end portfolio that allows us to position ourselves with strength, competitively, in the market.”
Resellers attending the fall meeting of Tech Data’s TechSelect community in Vancouver, B.C. this week are already benefitting from the end-to-end part of that equation. Combining the Tech Data and ATS line cards, many say, is helping them save time and money by shrinking the number of vendor relationships they have to manage.
“It’s enabled us certainly to continue to bring our spend down to one place, which obviously gives us deep relationships and a better experience,” states Ryan Benner, vice president of enterprise infrastructure at Arraya Solutions, of Plymouth Meeting, Pa.
The truly strategic change brought about by the ATS purchase, though, is the services and consulting depth it’s contributed in some of the industry’s fastest-growing segments. Tech Data was no slouch in those solution areas before, according to Quaglia, who notes that cloud computing revenue has been growing at a 160 percent CAGR for the last three years. But the added expertise ATS brings to the table positions the company to accelerate such growth by helping its partners launch entirely new lines of business.
Indeed, Arraya is tapping into ATS’s assessment services and outsourced security operations center to get a new cybersecurity practice up and running significantly faster than would otherwise have been possible.