IT and Business Insights for SMB Solution Providers

Tech Data Switching from Transform to Perform

With its multi-year transition from distributor to solutions aggregator now complete, the company is ready to focus on execution, according to North American sales leader Marty Bauerlein (pictured) and others at this week’s Tech Data Partner Summit. By Rich Freeman

The latest Tech Data Partner Summit, which took place this week in Chicago, was built around a four-word theme meant to convey the urgency of transforming outdated business models for a new era of IT: “Unlearn yesterday. Breakthrough tomorrow.”

It’s a message most channel pros still need to hear at a time of escalating demand for end-to-end solutions, rather than products, and skyrocketing adoption of next-generation technologies like cloud computing and the Internet of Things. Based on conversations with company leaders, however, a different four-word phrase arguably applies to Tech Data’s own transformation: “Been there. Done that.”

Indeed, according to Senior Vice President of North American Sales Marty Bauerlein, the multi-year transition from distributor to solutions aggregator that Tech Data commenced some two and a half years ago with its $2.6 billion purchase of Avnet Technology Solutions is now largely complete.

“It’s time to go from transform to perform,” Bauerlein told Partner Summit attendees in a Wednesday morning keynote. “Performance pays the bills.”

Not that paying the bills has been a problem for Tech Data lately. The $37.2 billion in revenue it reported in its 2018 fiscal year represents an 11% gain over 2017 results, and the company’s gross revenue from SMBs climbed over 23% in fiscal 2018. Moreover, while Tech Data’s traditional fulfillment business remains healthy, what’s fueling its growth is clear: Advanced solutions of the kind made possible by the Avnet acquisition currently account for 70% of net sales.

According to Bauerlein, such figures are evidence that Tech Data has in fact moved beyond transformation to execution. “We’re in perform mode, and our performance has been stellar,” he says.

New resources announced in recent months and previewed at the Partner Summit hint at the gathering steam around Tech Data’s strategic post-acquisition alignment around four next-generation markets—cloud computing, security, Internet of Things/analytics, and endpoint solutions.

In May, for example, the company unveiled an IoT “solution factory” tasked with churning out complete, market-ready solutions in core vertical industries. Modeled after a similar operation for cloud computing that launched 16 new “click-to-run” solutions for data protection and other scenarios in July, the IoT factory shipped its first 30 solutions that same month, and has many more coming, according to Lisa McGarvey, Tech Data’s manager of IoT solution development for North America.

“We’re looking at updating our solution catalog quarterly,” she says, adding that a steady stream of IoT vendors will be joining the Tech Data line card in coming months too.

“Within our North America team, we now have someone who reports to Colin [Blair, Tech Data’s vice president of IoT and analytics solutions for the Americas] who focuses on vendor recruitment and management specifically for IoT and analytics,” McGarvey reports.

A separate team dedicated to security and led by Vice President of Global Security Solutions Francisco Criado showcased several forthcoming resources of its own at the Partner Summit, including a state-of-the-art 4,000 square foot “cyber range” presently under construction in Tempe, Ariz. Set to open this November in conjunction with Tech Data’s first-ever security solutions conference, the facility will allow channel pros to get training, demo solutions for customers, participate in hackathons, host events, and more.

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