IT and Business Insights for SMB Solution Providers

Vox Channeli: Size Matters for Distis…Sometimes

According to the results of our latest reader survey, most channel pros buy selectively from both big broadline distributors and smaller specialized ones. By Rich Freeman

In an interview with ChannelPro hours after word broke that Tech Data Corp., of Clearwater, Fla., had purchased the technology solutions unit of Phoenix-based competitor Avnet Inc. for $2.6 billion, CEO Robert Dutkowsky made the strategic thinking behind that deal crystal clear. Adding Avnet’s value-added services and 40 vendor partnerships to Tech Data’s expansive product inventory, he argued, would satisfy a strong and growing appetite among resellers for one-stop distribution shopping.

“Tech Data believes that the distributor that’s going to be kind of the benchmark for the next decade or so is going to truly be an end-to-end player,” Dutkowsky said. “The day of the distributor being kind of a specialized stovepipe supplier of solutions into the market, we think, are over.”

In a more recent conversation with ChannelPro during the fall meeting of Tech Data’s TechSelect partner community, Joe Quaglia, president of the distributor’s Americas operations, elaborated on that point.

“First of all, vendors can only support so many distributors,” he said. “Secondly, partners only have the skills and capabilities and the infrastructure and dollars to do business with a handful of distributors.”

True enough, but to what extent are such facts actually driving resellers into the arms of distributors with all-inclusive offerings? Eager to know, we investigated the matter in our latest reader survey, and discovered that when it comes to picking distis, end-to-end player versus stovepipe supplier isn’t an either/or proposition for most of you.

Vox Channeli: Size Matters

Indeed, just a speck less than 62 percent of survey participants said they like both big firms with comprehensive catalogs and smaller ones with specialized expertise.

Which begs the obvious follow up question: Why do so many channel pros selectively buy from both large and small distributors? The SMB TechFest event, which ChannelPro is currently attending in Anaheim, Calif., turned out to be a perfect venue for finding out.

“The large ones often have the greater availability of services, and have warehouses that are local,” said Justin Sowa, chief engineer at Valorem Technology Inc., a Tustin, Calif.-based IT consultancy that does business with both big and small distributors. That comes in handy when you need something in a hurry and don’t want to shell out for expedited cross-country shipping. On the flip side though, he added, smaller distributors often provide more personalized service.

“You get to know your reps a lot better than you do with some of the bigger ones,” Sowa said. “There are times with some of the biggest ones [that] you become an account number.”

Gary Metz, managing partner of Ingenious Geeks Inc., also of Tustin, pointed to a second, somewhat more surprising, distinction between broadline and focused distributors.

“They don’t all have the same products necessarily,” he said.

For all their talk of comprehensive inventory, the largest distributors occasionally don’t carry obscure products for niche markets that only specialist distis stock. Until top-of-the-pyramid distributors can provide truly one-stop shopping, it seems, they’ll be sharing customers with their more targeted siblings for some time to come.

About the Author

Rich Freeman's picture

Rich Freeman is ChannelPro's Executive Editor

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