Verdict on vendors
Vendors are fond of talking up the level of support and assistance they provide to the Middle East channel. But how much of what they say is exaggerated and how much is true? Who better to ask than the partners themselves...
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Gigi George: We are very privileged to have strong partnerships with our vendors and could not, in all honesty, single out one vendor. However, since a large majority of our projects are in the ELV sector, we work a lot closer with vendors in this sector, including Polycom, Symon and Bosch.
What is the one thing that most irritates or frustrates you about the vendors you work with?
Abdulrahman Al-Kayali: Playing with the rebate programmes.
Khaldoun Borini: Changing the policies and expanding horizontally across many partners. I’m not saying vendors should go back to the model of just having one partner, but there should at least be a limit.
Gigi George: One of the advantages of working in niche segments is that while we offer bespoke solutions, we quite often partner with smaller, specialised vendors that work remotely in this region and sometimes this can pose a logistical and — occasionally — an educational challenge.
Nayagam Pillai: The biggest frustration comes every time there is a change of people because the person takes a lot of time to settle into the position they are employed for. And the price paid for the mistakes they make and that learning curve comes at the expense of the margin of the channel. A new guy comes in and has his own ideas, and that leads to the second problem, which is a change of policies, procedures or go-to-market model. You find that these principals keep changing their structure every six or 12 months — every time there is a change of face — and it is the single most frustrating thing about them.
Anil Gupta: A lack of commitment towards the channel’s interests. Vendors wish to eat their bread with both sides buttered.
Tarun Nandi: It is frustrating when vendors are sitting here and they get a complaint and don’t look for any solutions. I will give you a simple example: APC. There are so many duplicate APCs in the market. People at APC know about it but they don’t do anything. Another thing is the grey market. APC knows that grey marketing is there — the prices are cheap — so they should come in the market and support the reseller. But if they don’t do it then the reseller loses their trust. With the grey market or duplicates you have got to support the resellers. Yesterday I was fighting with a distributor of Canon because there’s a lot of grey.
Albert Raj: RMA. Normally all the products purchased from distributors should have a one-year warranty from the date of our sale to the end-customer. But distributors give a one-year warranty from their purchase date, when they actually get 15-month warranties from the vendors.
What steps could the vendors that you work with take in order to make your business better?
Gigi George: There are several important steps that vendors need to take care of. The main one is better communications, especially during the process of bidding, implementing and supporting large technology projects. This includes transparency in the vendor’s supply chain model so that we can plan better in terms of delivery schedules. Of course, other support systems like technical training and marketing collateral help as well.
Khaldoun Borini: Ensure that assigning new partners is based on the quality of the performance, not on closing a specific deal during a specific quarter. A better understanding of local markets and local cultures is also needed. This specifically applies to marketing support. In many cases, what applies in the countries that vendors are from doesn’t necessarily apply to ours.
Nayagam Pillai: I think the single most important thing for the vendor and the reseller community is that the business model is transparent. For instance, we are not demanding that they support us, but if we have put in the effort and it is early in the sales cycle then we need protection, and that all boils down to transparency. We don’t want complicated processes and we don’t want the cost of doing business to be high. Transparency is something that lacks in channel management across the board. Every individual here has their eye set on a position in Europe or the US, to be very frank with you. They end up using this opportunity to meet their quotas and move onto the next level.
Anil Gupta: They should stop being greedy and enrolling every channel company that comes their way just to maximise reach in the fastest possible way. They need to honour past close business relationships rather than ignoring existing partners’ investments in terms of getting the people trained and opening up the customer base. In the majority of cases, it is the reseller that sells the vendor’s solution and the vendor doesn’t have any role to play in these deals except that they are known in the market. I would classify these as our customers — in no way can they be claimed as the vendor’s. The majority of vendors have lost the basic principles of what business though the channel actually means.
Abdulrahman Al-Kayali: Be honest, give space to their major accounts to generate more profit and focus on the quality of business rather than the volume of business.
Tarun Nandi: The formula for any business across the world is 80-20. That means 20% of your customers generate 80% of your business. That formula was there 50 years ago and it still exists today, so vendors have got to realise that they can increase their customer base but they have to support those 20% of customers which have been loyal to them. We need marketing, we need incentives, we need volume discounts and we need them to stop grey marketing. They should also have a universal pricing structure. It should not be the case that we have a price, Europe has a price and the Far East has a price. Product allocation is also an issue. Any new product goes to Europe and the US first. We are always the last to get it. HP has printers with 95% allocation to the US and Europe, and 5% here. Take a printer like the 5550dtn, for example, which is a common entry-level laser colour printer. To get this product you have to beg the distributor for allocation!
Albert Raj: They should have proper sales, pre-sales and technical teams to support all resellers and end-customers before they start selling. Secondly, they should meet up with resellers regularly, understand their problems and try to resolve them.