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How distribution outnumbers the lottery.

Apr 27, 2021 8:59:14 AM Neil Cornish Vendors, Ecosystem, Value Proposition, Customer Relations

The announcement that Catherine Solazzo is joining Tech Data as Senior VP for Marketing in the US is further evidence of the strengthening ties between IBM and Tech Data. Catherine’s previous role was VP Worldwide Partner Ecosystem Performance Marketing in IBM.

 

But it is not just IBM that Tech Data have close relationships with. We work with thousands of different vendors around the world; the Global brands and those in-country specialist suppliers.

 

The role of distribution has changed significantly over the past 5 years as each vendor increases their percentage of revenue transacted via the channel. IBM has stated it wants to move the dial from 35% to 70% of revenues via their Ecosystem by 2025.

 

With the added opportunity comes the challenge of managing the wide range of programmes, incentives and certification requirements of each vendor. And this takes investment. In people; their education, experience, relationships with key vendor personnel and knowledge of the partner community. It also requires a huge investment in systems, to provide the quoting, order placement and delivery management for each vendor.

 

The combinations of vendor programmes, product certifications, customer types, number of vendors and number of partners are in the first prize for the “Euromillions” category; which is 169,000,000 to one by the way. Just in case you are wondering why you haven’t won yet!

 

How do I get there? Well every vendor has a tiered partner programme – Silver, Gold, Platinum or Advanced, Premier, Specialist etc. And if you want a quotation then the end-user will have a pricing model based on where they are in the league table, their passport advantage number (IBM) or the route to market, or all of the above.

 

And then how is the product delivered? As a service, perpetual licence, subscription, capacity on demand? So, we have at least a 3 x 3 x 4 matrix before we consider the number of partners, the number of products and number of vendors.

 

If we assume each vendor has 500 products (some have many more) and we have 100 active vendors. In the UK we have 7000 partners. Now, 36, x 500, x 100 x 7000 gives us 12.6bn or 12,600,000,000 combinations we might have to quote against. And this assumes the partner has sufficient credit limit, is not going to sell outside the approved territory and has obeyed all the rules for a Government Owned Enterprise!

 

Then there are the options for MSPs, CSPs and those looking to embed the vendors technology in their branded solutions, such as the IBM ESA programme, often covered here. All have their own pricing matrix. And finally (although I’ve probably missed something) every vendor will have a quarterly, half year and year end promotion or a rebate programme that changes the ground rules. Combined with new product announcements, withdrawals and general pricing action, the number of quotation permutations are immense.

 

Who’d have thought winning the lottery would be easier than providing a vendor quotation!

 

But providing quotations and order management for the vendors, is just the start for the role linking the vendor to the partner. Building out the industry Ecosystems, making new solution partnerships across sectors and vendors, is where Tech Data truly adds value.

 

As we look to expand the number of ecosystems and vendors supported during 2021 the Value Proposition workshops become really powerful in understanding what businesses are looking to achieve and who they might benefit in partnering with.

 

And our events continue to provide both education and opportunity for introductions. Last week’s CSP club and the Red Hat ecosystems recordings are now both on the Tech Data Ecosystem You Tube site.

 

For those partners looking to find new solutions or new routes to market please get in touch. This part of our value add doesn’t need to be a lottery!

 

Neil Cornish

Written by Neil Cornish

Neil Cornish is Business Development Manager at Tech Data UK

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