SPECIAL FEATURE
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DISTRIBUTION IN FOCUS
Evolutionary times ahead
As more software-based services and applications emerge and move into the mainstream, distributors will continue to play a pivotal role in helping resellers shape their future goals and strategies, according to James Perkins, Group Sales Director at Nimans and Rocom.
Alex Lister
A
Group Board restructure at Nimans-Rocom signifies the distributors’ evolution and adaptation to the broad base of technology it now sells. With ever-changing market conditions, delivering on service as well as profitability is a top priority for the distributors as they help drive the adoption of new and emerging technologies by educating and helping resellers understand and exploit new sales and business opportunities.
Like all sectors of the voice and data channel, distributors are under pressure to find new ways to improve profitability, but according to Perkins the key is to develop long-term growth partnerships with resellers and manufacturers to accelerate revenue streams. “I would tend to talk about profitable growth rather than just profitability,” commented Perkins, who has spent 12 years working at technology distributor Ingram Micro. “We are always looking to help support our customers and the channel to improve their own profit performance in line with our own. If they are in a healthy situation so are we.”
There is inevitable margin pressure throughout the whole industry in terms of pricing, noted Perkins. “Across many sectors of the channel sales volumes went down last year, and several suppliers
decided to put their prices up. That’s something we can’t control,” he said. “But there are ways to streamline expenditure, from warehousing and order processing for example, to minimise the impact on dealers.”
As distributors sit between resellers, their customers and suppliers, it can be increasingly difficult to make profits due to administration red tape in terms of price differentials and sign-off levels with suppliers, which takes time and man hours. “We need to have stronger and closer partner relationships where we work together and trust each other more, freeing up our time so that we can get on with helping resellers grow their businesses. I want to build better and more productive relationships by removing any unnecessary obstacles,” stated Perkins.
On a personal level Perkins wants to fully understand the voice of Nimans-Rocom customers, get closer to their requirements and work with suppliers to deliver on their needs. “Profitability is important and our relationships with customers and suppliers is what ultimately drives this,” said Perkins. “Provision of services and
value propositions contribute to a better customer experience which in the end will deliver profitable growth, better services, better products and better solutions.”
Pressures to improve profitability are forcing distributors to build on their heritage and core strengths to refocus and evolve. But Perkins doesn’t agree that this pressure is the biggest influence on how the distribution landscape is shaping up. “Convergence has been talked about for many years,” he commented. “In the end a distributor is there to provide credit, good products that deliver a solution, as well as white label services when required. Products don’t change based on marketing messages. It’s about supply and demand and partnering with the right manufacturers, educating resellers about the opportunities and how they can have a positive benefit on their bottom line.”
Cast your mind back 10 years and consider the product segments and technologies of a decade ago, and it will soon become clear that a distributor will roll and change with the times, observes Perkins. “Technologies should bring efficiencies that ultimately change
A distributor will roll and change with the times
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James Perkins
the market focus. And part of the role of a distributor is matching the suppliers and the dealers with the right products, with the right stock at the right price,” he said.
“I’ve been in distribution for 15 years. I’ve seen the emergence of smart phones, wireless networks and videoconferencing. The business world has changed dramatically, so whether it’s the cloud verses physical storage, people and customers will choose the right solution that drives efficiencies at the end user level. As technology evolves, ultimately we as a distributor also evolve.”
Perkins noted an appetite from the suppliers for convergence and IP, more than probably ever before, but justification, based on cost and business investment in the current climate, is hard to predict. He commented: “On the one hand businesses are still reluctant to spend money, but on the other they want to raise efficiency and productivity levels, and need technology to help them achieve this. That’s the quandary organisations are grappling with.
“Clearly, we believe that distribution provides great value to our customers and suppliers. How to work smarter and achieve greater levels of profitable growth
is the challenge for all of us.” n
Distribution Focus cont’ on page 52
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