IT and Business Insights for SMB Solution Providers

Tech Data Aims to Turn Product Pushers into Solution Providers

Drawing on assets acquired along with the former Avnet Technology Solutions, the distributor is helping resellers transform themselves from hardware and software order takers to providers of high-margin, industry-specific product and service combinations.

By Rich Freeman

Adding the former Avnet Technology Solutions (ATS) to its existing resources positions Tech Data Corp. to help resellers evolve from selling product to selling solutions, according to Marty Bauerlein, the Clearwater, Fla.-based distributor’s senior vice president for North American commercial and retail solutions.

“There’s still a lot of money to be made on the product side if you’re really good at it,” he says. “However, if you’re looking to transition and make some higher margins you’ve got to get into [solutions].”

Bauerlein spoke with ChannelPro at the spring 2017 meeting of Tech Data’s TechSelect partner community, which took place last week in Savannah, Ga.

ATS’s prowess in designing and delivering multi-faceted, industry-specific solutions was a big part of why Tech Data bought that business from Phoenix-based Avnet Inc. for $2.6 billion, he notes. Announced last September, that transaction closed in February.

According to Bauerlein, resellers looking to prosper in a market facing commoditization from cloud computing need to offer specialized solutions expertise in targeted markets in addition to hardware and software. ATS, which is now known as Technology Solutions, arms Tech Data to help partners acquire that expertise.

“We feel like we have a game changer here,” Bauerlein says, pointing to Technology Solutions’ HealthPath University as an example of the kind of offering now available to Tech Data resellers looking to become true solution providers. Enrollees in that program spend a week onsite in Phoenix learning the ins and outs of healthcare industry IT from former hospital CIOs and other industry veterans.

“It is a heavy time investment,” Bauerlein notes, and one that many partners aren’t yet willing to make. Many others, though, are banging on the classroom door to get in.

“We have 15 [partners] on the waiting list,” Bauerlein says of the training courses. “We can’t do enough of them.”

Graduates of the program make more money for themselves and Tech Data alike, he continues, by closing bigger deals involving a wider mix of products and services, including offerings like Recon, a subscription-based managed security service from Technology Solutions that generates ongoing annuity revenue.

Bauerlein believes programs like HealthPath increase partner loyalty as well.

“It’s sticky,” he says. “The more you invest and enable them and help them grow their business, they’re going to be loyal forever.”

The hands-on attention partners receive at HealthPath University is one example of how Tech Data is utilizing personalized support to deepen partner relationships and increase revenues, especially in the SMB segment.

“It’s a contact sport in SMB,” Bauerlein says. Resellers who focus on SMBs receive a dedicated, U.S.-based sales rep, he notes, as well as one-to-one credit assistance and access to a wide range of marketing enablement tools, among other resources.

Tech Data has grown the SMB workforce delivering those services 15 percent in the last year. Though he declined to cite specific numbers, Bauerlein said momentum for Tech Data in the SMB market is strong at present partly as a result of those added resources.

ChannelPro SMB Magazine

Get an edge on the competition

With each issue packed full of powerful news, reviews, analysis, and advice targeting IT channel professionals, ChannelPro-SMB will help you cultivate your SMB customers and run your business more profitably.