Distributor storage services outweigh drawbacks for VARs

Distributors expand storage practices, offering more alliances and better services to VARs, despite delays in communication and awkward customer relationships.

Many distributors have recently expanded their storage practices, inking deals with storage vendors to offer resellers a growing number of products and services. While many resellers are cautious about aligning themselves too closely with distributors, others say their distributor relationship has strengthened their company's skills and services.

"I can see a trend. Distributors are continuing to bolster technical expertise and support as they make their VAR partners stronger," according to Patrick Edwards, vice president of sales at Hanover, Md.-based Alliance Technology Group.

Alliance Technology has partnerships with Avnet Inc., Tech Data Corp. and Ingram Micro Inc. Through these distributors, the company has received lines of credit, trained its staff on specific technologies and benefited from technical staffs that distributors have provided for projects requiring configuration of systems.

"The technical support and expertise that they help provide both direct and in training requirements ultimately provides a tangible return on investment in the way of solutions sold to our end users," Edwards said. "If we provide a more technically sound solution to an end user we're going to win the deal," Edwards added.

Distributors are a great resource for pricing and configuration information; but having to route questions through vendor reps at a distributor -- who often have to ask two or three sources at the vendor for answers -- can cause delays that endanger the deal, according to Greg Knierieman, vice president of marketing and business development at Cleveland, Ohio-based CHI Corp.

"There's an extra level of bureaucracy that can sometimes create delays, sometimes very bad delays, from an end user's perspective," said Knierieman, who counts Bell Microproducts, Ingram Micro and Tech Data as distribution partners. "We've been in situations where we've had users say, 'Look we've revised this configuration and we need a pricing change by the end of the day tomorrow.' We cannot always turn around that information within a 24-hour window because there are so many steps built up in the distributor level that has to be worked through," Knierieman said.

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Knierieman said his company is also not keen to use a distributor's test centers and other resources, preferring to build up its own in-house expertise rather than lean on a distributor's.

"Typically, in many of the storage solutions at large enterprise customers that we are integrating, the end user wants proof of concept not at a test lab, but in their own facility," Knierieman said.

Still storage, once the red-headed stepchild among other technologies at key distributors, is finding a place at the table with distributors expanding their storage practice, and in some cases creating whole new divisions that help value-added resellers (VARs), systems integrators and vendors coordinate their go-to-market strategies in ways storage vendors cannot do.

"Most of the vendor community needs the distribution arms in order to get the kind of coverage that they have because you can't cover it on a direct basis all the way out to the ends of the earth," said Pete Koliopoulos, vice president of global channel marketing at EMC. "You also can't have single-tier resellers cover it all because it just gets too much."

Certainly, distributors are pressing with expansions of their storage practices, and changing the storage landscape in the process.

In November 2006, for example, HP and IBM distributor Avent bought Access Distribution, a company with specialties in storage and Sun Microsystems Inc.'s products. Subsequent to the acquisition, Avnet created a new business unit -- Avent Technology Solutions, Access Division.

Fred Cuen, president of Avnet Technology Solutions, Americas said storage has grown to become a significant part of Avnet's revenue.

"It has been the fastest growing segment of our business over the last couple of years, so our emphasis in people and programs has been very very significant in this area and results have been paying off," Cuen said.

In January Tech Data launched its Advanced Infrastructure Solutions Division (AIS) to assist storage VARs with sales, marketing and technical management in area such as virtualization, storage consolidation and x86-based blade server technology.

This month Arrow Enterprise Computing Solutions (ECS), a business unit of Arrow Electronics Inc., announced a deal with CommVault in which ECS will provide CommVault's VARs with CommVault products as well as certification and training.

Earlier this month, ECS signed another agreement to sell IBM CommonStore email archiving preloads and content management software to Arrow ECS' resellers.

"There is tremendous demand for storage solutions among end users, but there is a limited talent pool of people with storage backgrounds," said Robert Boulet, vice president of Arrow ECS' storage group. "Resellers are also finding it difficult to find people with storage expertise.

Rapid changes in storage technology have given Bell Microproducts an opportunity to work more closely with VARs to get feedback on customer demands; trends in technology help partners make the right technology choices, according to Gary Gammon, the company's senior vice president of marketing for enterprise solutions.

"We engage the VAR about their particular market and how they want to go to market and we help them understand how to build a storage practice," Gammon said.

Ingram Micro plans two solution-based campaigns this year -- one for network storage and the other for business continuity and disaster recovery.

"Previously, we had one large overall storage campaign where we provided training on a broad range of solutions," according to Jason Reiher Ingram Micro's category manager for systems and storage. "For 2007, we created these upgraded and focused campaigns after listening to what technologies and solutions our customers were most interested in," Reiher added.

As storage needs continue to increase, Edwards said he expects the trend to continue.

"I'm seeing a trend that is not stopping, it's continuing and so is the value-add that distributors give to VARs. They help us look like we are a bigger and stronger partner to our end users," Edwards said.

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