Redington Valueplus - Jan. 2010

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    value plusthe

    Q U A RT E R LY

    TIME FOR

    ACTIONNew business opportunitiesahead mean its time to getorganised!

    JuniperHP ProCurveCiscoHP ServerMolex

    0509121518

    January 2010presents

    A SPECIAL PUBLICATION FROM REDINGTON GULF VALUE DIVISION

    HIGHLIGHTS:Building a profitable, productive smallbusiness practice through partnerenablementThe business value of storagevirtualisationThe Big Connect

    Redington is a Value Added Distributor for the following brands across the Middle East and Africa

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    B y design the relationshipbetween Vendor Distributor Reseller issupposed to be a symbiotic

    relationship, a perfect triangle with all the three partners workingsmoothly with each other andadding value to each other on acontinuous basis, but practically does this happen?

    This is a key question that

    needs to be answered honestly.The key stake holders in thedebate are people working fordistribution houses, channelrepresentatives from vendors andpartners at large. Lets look atsome common pain points fromeach of their perspective.

    Some pain points from adistributor: Vendor is not supportive anddoes not look at things fromour perspective Vendor is more supportivetowards another distributor!(Why would he do that? The

    vendor might as well not have you as distributor!!!)

    This vendor does not understanddistribution - he is only looking atsell in, with no sell out focus at all This vendor expects us todevelop his market, but does notunderstand that we need to earnsomething before we invest theold chicken and egg story!!!

    Common complaints from a

    vendor perspective: This distributor is just a fulfillmenthouse and does not focus on any market development

    This distributor is far tooconservative and is not willing toinvest in the business!!! This distributor does not havereach!!! (Didnt he discover thisbefore appointing the distributor?) This distributor does notunderstand value add !!

    Some common voices of concernfrom a resellers perspective

    (Imagine a typical 2 tier mediumsize reseller, who dependsalmost entirely on supplier creditfrom the distributor and backingof the vendor to close business): The vendor is trying to controleverything including our margins!!! The vendor is not transparentand always playing betweendifferent resellers!!! The distributor is not proactive!!! The distributor is very conservative in giving credit We prefer to work with all thedistributors!!! (No loyalty)

    The above statements are very prevalent in the industry wheneverthere is a closed door discussion.Most people in the industry are

    aware about it, acknowledge it butavoid being quoted.As a professional associated

    with the distribution industry for afairly long time, I have experiencedthe above and have heard fromcolleagues within the ecosystemexperience the same. There havealso been tremendously successfulrelationships between resellers/

    vendors/distributors and thereare individuals who have beenextremely successful in buildingbusinesses which have used this

    triangle to the hilt. It is importantto understand what works and,in cases it has not worked, tolearn what has not worked sothat for the industry at large, thiscan be some form of a pointerto avoid pitfalls in forming theserelationships to start with.

    Following are some verybroad lessons that I havehad during my journeyin distribution and maybe useful as pointers toovercome some of the issuesdiscussed above:

    Get the expectations rightfrom Day 1- When forming a

    relationship, be as transparentas possible and get theexpectations set realistic onboth sides from the start. Donot make the mistake of settingeither too low or too highexpectations from both sides.Learn to say NO and walkaway if it does not make senseto be in a relationship.

    Understand the importanceof joint business planning-Understand the businessgoals of both sides clearly.

    RAMKUMARS BLOG

    Ramkumar B, GM, Value Division, Redington Gulf

    The joint business plan shouldmake the goals of both sidespossible it has to be a WIN WIN relationship. Understandthe compensation and rewardplans for the employeesinvolved on both sides.Remember: at the end of theday, its a people business!

    Communicate every day-Communication or lack of it isthe SINGLE MOST IMPORTANTreason that many relationshipsdont work. Weekly, monthly andquarterly reviews at differentlevels are a MUST. Proactivecommunication is necessary,so always communicate as if

    in a partnership, not as if it isbetween two different parties.Call it off when joint vision

    not possible- Remember thatevery relationship does not lastforever. When a joint vision isnot possible, call it off and donot PROCRASTINATE. Finally,being in a relationship and notseeing a joint vision is the worst

    possible situation.I hope the above would help

    each of us to maximize productivity with our business partners.

    Distributor - Vendor -Reseller - Is a symbioticrelationship possible?

    4 The ValuePlus Quarterly January 2010

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