TechSelect conference kicks off with good news, bad news

At a TechSelect event, the distributor points to the community's higher 'wallet share' and good vertical traction, but its poor performance in cloud.

TORONTO -- Kicking off the TechSelect Spring Partner Conference here yesterday, Pete Peterson, Tech Data Corp.'s senior vice president of U.S. sales, referred to the three-day event as branding for the beginning of the new TechSelect -- a time for members to take the community to the next level and to take relationships and partnerships to the next level.

In its 14th year, TechSelect -- a member organization that promotes partnering and collaboration among Tech Data, its vendors and its partners -- boasts 407 member companies, including 11 members that joined in 2013. To qualify for TechSelect membership, VARs that do business with Tech Data must pay membership dues, purchase a minimum of $300,000 in products and services per year through Tech Data, and meet specific certification and vendor authorization requirements. Collectively, these members represent 21% of Tech Data's revenue. Peterson challenged the attendees here to help increase those numbers to 450 members and 25% of revenue.

Tech Select members typically garner a higher percentage of IT organizations' budget dollars than Tech Data VARs that aren't members. "Looking at the TechSelect community as a whole, we have roughly 32% '[wallet] share,'" Peterson said. That compares with 20% wallet share for all of Tech Data's VARs across the U.S., he said.

That 32% wallet share is good, but not enough for the executive who leads Tech Data's nationwide inside and field sales teams. Peterson challenged attendees to do better going forward, stressing the unique opportunity to grow together, especially by utilizing Tech Data resources to help partners grow their business.

TechSelect has six new vendor partners -- Brocade, Epson, EMC, Ipswich, Kaspersky and VMware -- in addition to its 16 returning vendor partners.

The distributor is looking to fill in some holes in its vendor partnerships, particularly in the area of such client systems as tablets, notebooks and PCs, where it has none.

Turning to the product categories where Tech Data does business and the percentage of business TechSelect does in those areas, Peterson challenged the community to increase its percentages in such areas as software and peripherals and to gain traction with vendor partners in those areas.

There was good news for TechSelect members in an evaluation of their vertical market performance in 2012, compared with Tech Data's overall business in vertical markets. For example, TechSelect business grew faster than the distributor's overall business in the sectors of government, healthcare and data center, and especially in mobility, which grew by 43% for TechSelect members compared with 4% for Tech Data as a whole.

That's where the good news ended. While Peterson noted that the distributor's cloud business is small but fast-growing -- it was up in 2012 by 55% for Tech Data -- it declined by 8% for TechSelect members. To address the disparity, he recommended that partners reach out to Tech Data for help in the form of services and other offerings.

Frank Rauch, VMware's vice president of the Americas Partner organization, was on hand to help kick off the TechSelect Partner Conference. He talked about VMware's commitment to the channel and the company's three priority areas -- software-defined data centers, hybrid cloud, and end-user computing and mobility -- and the importance of these technology areas to the channel to grow their business.

Rauch told TechSelect members to expect to see VMware's commitment of $433 million to the channel increase to bolster channel coverage, programs, incentives and rebates.

And why not? According to Rauch, 87% of VMware's Q1 revenues went through the channel.

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