For the last few months there have been ramblings in the channel partner
space. Especially in sub-distribution where the margins have thinned and many
vendors and even some national distributors have been trying to go directly to
the consumers. Things certainly did not look too rosy. With this backdrop we at
The DQ Week decided to organize the Disti Summit.
The idea was to provide a forum of interaction between sub and regional
distributors and vendors, with us acting as the third party facilitator. The
response to the concept initially was skeptical-–what would we do there? Will it
make a difference? How would sessions that you have organized help us? The
queries were many and at that time the answers were few. Sometimes it made one
wonder if we would be able to answer any of the queries.
Now that we have just done the first summit in Hyderabad, the post event
response from the participants, has vindicated our stand that sub-distributors
are vital for the IT channel space. Not only that at some level we were able to
provide some insights into what can be done to better the business and how can
that be achieved without major changes. The response to the keynote by Jitendra
Kulkarni, or JSK as he is commonly known, was amazing.
 |
| Shivangi Yadav |
Let me share some of the learning's from the session. First and foremost JSK
reiterated that despite what the naysayer's might lead you believe,
sub-distribution, as a model is not going to perish any time soon. It might
require a bit of tweaking, to go with the times but as a model it is here to
stay.
Firstly and most importantly the sub-disti needs to control credit and make
sure policy enforcement is happening regularly. If payments are overdue or
products are lying unused then you have no one but yourself to blame. Earlier
the distributors sustained financial viability because of high growth rates and
relatively higher margins, which is no longer true.
The best thing in these times is to have a broader product portfolio. Even
when one vendor is giving you great business, keep on adding products and other
vendors. Also keep looking for alternate business models. Scaling up business is
another option as is expanding in adjacent industries like telecom, consumer
electronics, white goods and mobile devices. And with the world embracing
retail, why don't you do the same.
The one takeaway is that there are always options for doing better and don't
give up on sub-distribution because as a business model it is here to stay.
shivangiy@cybermedia.co.in