Arrow targets medium-sized businesses, vertical markets

Arrow Electronics targets medium-sized businesses and select vertical markets. VARs anticipate the program will help them sell to midmarket customers.

Enterprise Computing Solutions (ECS), a business unit of Arrow Electronics Inc., launched a program last week designed to make it easier for its value-added resellers (VARs) to sell into specific vertical markets. Arrow has defined 40 different hardware and software configurations for different solutions and is making those blueprints available to its channel partners.

VARs testing the results said the preconfigured solutions do help them sell to customers in the healthcare, finance, professional services, manufacturing and wholesale markets.

According to Arrow's research, IT spending in those five markets is growing at more than 13% per year; Arrow's ECS unit is banking on its VAR partners to sell security, storage and virtualization with products from IBM, Oracle, Symantec, Citrix, VMware and other manufacturers.

The program is designed for VARs selling to midmarket customers in a particular vertical market in one geographic area, according to Kevin Gilroy, president of Arrow ECS. Those customers typically require little customization, and one IT preconfigured package can work for several customers, reducing the selling, general and administrative (SG&A) expenses of Arrow's VARs.

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Oakville, Ont.-based VAR ITX Solutions has lost business because customers do not have the money to pay for the upfront work VARs do when they put together an IT system for their storage needs, according to John Medaska, vice president at ITX. Arrow's ability to combine technology that will accommodate several customers' needs can help him win more business and reduce the cost of a project, he said.

"As these solutions mature they will increasingly become repeatable solutions, as opposed to customizing everything on every opportunity, which is expensive for customers and resellers," Medaska said. "Having these solutions helps VARs cut away some of the upfront costs and speeds up implementation time," Medaska added.

Arrow's assistance with skills in security assessments will help his company save on investing in that area, according to Vince DeRose, president of Denver-based PEAK Resources Inc.

"There are a number of areas where my company does not have specific expertise, like security. It's nice to go to Arrow and have them give me people and a product set that includes security, because I don't have skills in that area," DeRose said. "That means I don't have to spend investment dollars developing that side of the business; the distributor can augment whatever lack of skills I might have in selling and installing those products to the midmarket," he added.

Assistance with engineering skills is also important to Phil Sauvageau, chief operating officer at Omaha, Neb.-based MSI Systems Integrators. He says professional services like on-site engineering can help his company, which had approximately $400 million in revenue last year.

Sauvageau said storage represents one-third of MSI's business. He also said MSI does not want to take on more skilled employees, but there are times when projects are delayed because there is not enough skilled staff to work on a project.

"We want to staff up to about the medium needs of our business, and we always reach skills capacity with the work we do," Sauvageau said. "What Arrow has created means I can augment my staff with the skills that our projects need. Now I can go back to my customer and say now I do have resource and we can perform this project."

Other distributors recently developed programs to help their VARs and vendors sell products and services in the small to midsized business (SMB) market. In March, Ingram Micro Inc. announced SMB-focused enhancements to Glacier, the distributor's Cisco channel partner program.

Just this month, Tech Data Corp. introduced its Peer Discussion Group to help its SMB resellers discuss trends and share best practices as they tap into opportunities in the SMB market.

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