Dell dismisses distribution?

Dell is on the hunt for solution providers, but it doesn’t plan on going through distribution to make inroads into the channel.

While it seems everything is subject to change in this business, at least for now it looks like we won’t be seeing any Dell products on the shelves of Ingram Micro or Tech Data or Synnex.

And this channel strategy has met with mixed reviews from solution providers.

Dell, after all, already has direct relationships with many solution providers, who have been using the vendor’s built-to-order capabilities for customer orders. And they probably aren’t too keen to see a middleman (or two) enter the picture. After all, if it ain’t broke, why fix it?

It will be hard to win over those solution providers if it means margins could become slimmer and trimmer than they already are.

But clearly something wasn’t working, or Dell wouldn’t have turned to the channel in the first place.

And herein lies the problem – this isn’t much different than Dell’s previous “direct” model. If Dell does indeed want to win over a large number of VARs, one of the best ways to do this would be to go through big-name reputable distributors – ones that VARs already trust.

VARs who are wary of dealing with Dell, or who have been burned in the past, would be much more willing to deal with the vendor if a trusted distributor were standing behind it.

For others who want an opportunity to work with Dell, it would simply be a handy way to order stock, if this is already their business model and one they feel comfortable with. And it could be a way to ease the sticky transition of competing with a vendor to partnering with that same vendor.But if Dell is focusing solely on keeping costs down, then going through distribution may not work in its favour.

Dell hasn’t actually ruled out distribution, but so far, it looks like the vendor is going to go direct – direct with solution providers, that is.

Ultimately, the channel will provide what customers want – and if customers want Dell, then VARs may be willing to forgo distribution and deal directly with the vendor, even if they’re not comfortable with that.

But there’s still a lot of skepticism around Dell’s entrance into the channel, so much depends on whether resellers are willing to take a chance on the vendor. For some, without a trusted distributor standing behind Dell’s products, it may be seen as too much of a risk.

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Jim Love, Chief Content Officer, IT World Canada

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Vawn Himmelsbach
Vawn Himmelsbach
Is a Toronto-based journalist and regular contributor to IT World Canada's publications.

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