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The top 25 news stories of 2007 – Number 10: Terry Tomecek

The good ol' channel keeps the homes fire burnin' at Acer Canada

Acer Canada uses the channel exclusively and the subsidiary’s number one, Terry Tomecek, is not afraid to admit that. In the face of other hardware vendors such as IBM and HP which sell direct to large enterprise, Acer Canada takes a different approach, all the while still gaining share in the market.

“We use channels exclusively,” said Tomecek, general manager of Acer’s business in Canada. “We don’t have direct to end user sales.” Tomecek added that it’s more about the user experience – people still want to be able to pick up the notebook, touch it and feel it because it is a personal experience. With over 5,000 resellers in Canada that sell Acer, it’s still possible for the customer to get a tangible idea of what they are purchasing.

Dell in decline

When customers buy direct, they don’t always get that, said Tomecek. Dell’s shipment numbers, for example, have recently seen a decline in the market because of poor customer service, according to the latest IDC quarterly tracker worldwide. While Dell is trying to rectify that, Tomecek says one of the keys to Acer Canada’s success is being able to offer local support to the customer and not just some voice from an offshore call centre.

“Distributors have huge call centres with very efficient logistics services, which in some ways may help with shipping costs and keeping prices down,” said Tomecek. “If we were to hire our own call centres and we were to have our own shipping and logistics department, I don’t know if we’d be as efficient as most of the distributors are.” Tomecek added that distributors also have a lot of sales representatives that sell to different vertical markets, allowing them to touch a lot more people than a vendor can.

Without direct on-site support, Acer Canada is still not going after the big enterprise customer, but Tomecek is okay with that. “We come across people that will only buy from the manufacturer,” he said. “At this point we’re not prepared to look at that business.” Tomecek added that Acer Canada is, however, looking at getting more into the government sector but didn’t go any further into the company’s plans.

Despite not going after big business, Acer Canada’s sales remain steady – even if it isn’t reaping the rewards of new hardware bought by customers looking to upgrade to Microsoft Windows Vista. At this point, Tomecek says most of his company’s business customers are sticking with XP, while home users are forced to switch to Vista as they are left with no other choice, given that retailers are selling machines pre-loaded with the OS.

Signing with D&H

Acer Canada was also one of the first computer hardware vendors to sign on with D&H when it came to Canada this June. Tomecek says it’s been so far, so good, but he added that there’s a lot of competition in the Canadian marketplace for distributors.

As for Acer’s recent takeover of Gateway, Tomecek is staying mum on that subject for now. “Gateway and Acer are operating separately,” he said. “They have very low market share in Canada – one per cent or less.”

While it may be same old, same old for Acer Canada, while there are a lot of hardware vendors in the market, Acer has come out number one by leveraging the channel to support its name. And that’s what keeps customers coming back.

In August, Acer announced it would buy Gateway Computers for $710 million U.S., doubling its presence in the United States and becoming the third-largest PC maker in the world. Even though it has been a few months since the announcement, Tomecek had little to say about it other than to add that there have been a number of press releases sent out.

He believes the company will maintain the status quo and run both organizations indepedently. Approximately 10 per cent of the market share in Canada in the PC market could be attained with a combined effort.

Tomecek said customers shouldn’t only think of Acer as a notebook vendor when looking at its product line. “We always tell people, it’s not a notebook-only story,” he said, adding desktop sales remain steady. Tomecek pointed out that Acer also continues to beat or match LCD sales when compared to other vendors in the market. Continuing to diversify its portfolio, Acer brought out small, form-factor desktops in 2007.

Product lineup aside, Tomecek said Acer will continue to use distributors to help keep its costs down. By having the distributor deal with incoming calls, processing orders and logistics, Acer is able to focus more on the customer and hire fewer employees. Distribution and retail outlets are key to Acer Canada’s business model, helping it keep the business in the channel.