Tag: tech data

US outfits controls a third of European IT distribution

Beancounters at Bain and Company have discovered that US distributors Iuseurope-1024x640 control a third of IT distribution.

The study conducted on behalf of the Technology Channels Alliance (TCA), said the IT distribution was worth €69 billion 2015/2016 in the eight biggest European economies. US-based giants have a 35 percent share across these markets.

TCA chief executive Robert Norum said that the findings pour cold water on expectations given recent market consolidation and the perception that distribution is becoming a global game.

He said that 60 to 65 percent of all distribution is actually carried out by local and regional players which would concern the big three who think they have everything sewn up when the market is a lot more fragmented than most people would think.

Total European IT and CE distribution revenues across the eight markets rose two per cent to €69bn in 2015/16, with growth driven by mobility, printing, and the IT value segment, the study found.

That figure accounts for 37 percent of end-user spending of €189bn in those countries, or 42 percent when reseller margins are factored in, which would mean that over two-fifths of IT and CE revenue travels through the two-tier channel in Europe.

The percentage share of the end-user market intermediated by distributors in the UK leapt from 40 to 43 percent year-on-year last year, the research found, thanks in part to Apple’s decision to shift some sales to distribution here.

The percentage shares for Italy, Spain and Switzerland also rose, from 48 to 49 percent, 47 to 48 percent and 42 to 44 percent, respectively.

Wholesalers’ share for desktops and notebooks, for instance, rose from 57 to 59 percent and 65 to 69 percent, respectively. This was attributed partly to Lenovo, and potentially also Dell, shifting more sales to a two-tier model.

Bain said that the channels help in the new key technology drivers – cyber-security, hyperconverged infrastructure and the Internet of Things (IoT).

“Vendors need help working out how to get these products to market, and resellers need help working out how to sell them. Distribution is less of a box-shifter model and more of a value-add one.”

Distributors’ profitability, however, is on the decrease, the research found, with the average margin of a ‘traditional’ broad liner getting just one percent and the value player getting three-to-four percent.

Microsoft carries out partner review

Stefan_Lochner_-_Last_Judgement_-_circa_1435Software King of the World, Microsoft, is auditing its partners and sorting out the sheep from the goatees.

Request for proposals (RFPs) were sent out to existing and new distributors last Friday covering much of the software Microsoft puts through distribution especially its full packaged products (FPP), OEM Windows, OEM server and electronic software delivery (ESD) products.

At the moment, Vole uses Tech Data, Ingram, Westcoast, Exertis and Entatech but now it is thought that Microsoft wants its distributors to reflect its recent move into hardware and changes to its business model.

VIP and Ci Distribution have received an invite to bid which could suggest a widening of the distribution channel, or that some big names might be culled.

Ingram and Tech Data recently lost out in a similar review Microsoft completed for its hardware accessories business, which includes mice and keyboards. In that case there were seven distributors were invited to bid for this franchise but only Exertis and Westcoast were successful.

Avnet and Ingram see sales fall

avnettsJust as Ingram is about to be bought, HNA and Avnet gears up to sell TS unit to Tech Data, both outfits are seeing their sales slide.

It is no big news, both Avnet and Ingram Micro have seen several quarters of sales doom as they start their M&A activity.

Ingram’s Q3, which ended 1 October, net profits jumped 21 per cent annually to $78.5m (£64.4m) on sales which were down three per cent over the same period to $10.2 billion.  Ingram is becoming part of the Chinese giant HNA. It did not hold a Q3 earnings call or provide a financial outlook for that reason.

Tts CEO Alain Monié did say the third quarter had been seen “robust improvement in gross and operating margins.”

“We see further stabilisation in market demand across most of the globe and our teams continue to leverage our investments in productivity and services to deliver improved bottom-line results and growth in a number of areas as we benefit from the broadest solutions portfolio and widest geographic reach in the industry,” he added.

Avnet is trying to sell its Technology Solutions arm to Tech Data. For the combined business, including TS, net profit fell 47.1 per cent annually to $68.8m, on sales which slumped 13 per cent over the same period to $6bn.

This means that TS performed “below expectations”, with sales falling 21.2 per cent annually to $1.87bn.

CEO William Ameilo said Avnet’s future without TS looks bright.

“In summary, the sale of TS allows us to focus on electronic components business, to which we just added unique capability with the acquisition of Premier Farnell while providing significant capital to strengthen our balance sheet and fund future growth,” he said.

Dell signs up Tech Data

Dell logoTech Data will distribute a number of products from Dell in the UK and Ireland.

Dell, which in times past was positively averse to the channel, has changed its tune completely in the last few years

The company said the extended relationship with Tech Data underlines its “continued investment” in the channel.

Tech Data is one of the largest distributors of technology products in the world, with sales of close to $28 billion and a network of 115,000 resellers worldwide.

Andy Gass, MD at Tech Data, said in a prepared statement: “Dell has made a strong commitment to the indirect channel by opening its full product range to us.”

And Tim Griffin, CEO of Dell UK said: “Over the past few years, Dell’s Partner Direct programme has grown exponentially and the channel is now, more than ever, an essential element in Dell’s overall business strategy. Partners like Tech Data are pivotal to our success.”

 

Industry experts talk up R2B, R2D2

highA group of executives behind the Retail to Business (R2B) initiative is warning retailers that they could be in a world of trouble if they don’t start targeting businesses.

The R2B initiative was formed by Context and it’s backed by execs from Lenovo, AMD, Lexmark, Tech Data and other companies. The ultimate goal is to make retailers more competitive and capable of taking on B2B resellers.

“Let’s stop the decline – or stores will end up being showrooms,” Global MD for Retail at Context Adam Simon told PCR. “Don’t just focus on consumers and tablets – blur the consumer and SMB. Support the small business people and their entourage.”

The consumerisation of IT and trends like BYOD is already blurring the line between SMBs and average people. Context argues British retailers could learn a thing or two from telecoms who have dedicated in-store corners in their shops for business users. Germany is also setting an interesting example, as its retailers are already selling heaps of laptops to businesses.

Tech Data creates European reseller Windows 8 event

Windows-8Tech Data has teamed up with six OEMs to allow resellers to stay and play with Windows 8.

The event, in connection with Microsoft, Intel, Samsung, Toshiba, Asus, Fujitsu, Lenovo and HP will allow resellers to get hands-on experience and see for themselves a range of different devices for both personal and business use running the operating system.

EMS was called upon to design and build a presentation and product demonstration space as well as manage an intensive pan-European tour schedule.

The company said fifty events had been planned over 25 days and the tour was expected to attract thousands of visitors.

Nigel Judd, Marketing Services Director at Tech Data Europe, said EMS had helped Tech Data with the opportunity to give thousands of resellers across Europe a hands-on experience of the latest devices running on the Windows 8 platform from leading vendor partners.

EMS will manage the 10-week tour that starts in April 2013 and will target Brussels, Rotterdam, Gothenburg, Copenhagen, Berlin/Cologne, Zurich, Milan, , Ferrara, Barcelona, Madrid, Munich, Paris, London, Birmingham.

What HP really told its dear partners

HP Global Partner ConferenceLet’s face it, us journalists are like a dangerous bacillus for vendors. Although the press are important to HP, we must be kept in isolation, and any HP execs that come anywhere near us must be inoculated beforehand and go through extensive health checks afterwards to ensure they haven’t been contaminated.

So in the ICU unit at this week’s Global Partner Conference, we were kept carefully away from the 2,000 partners invited to the glittering jamboree at the very glittering Venetian hotel in swinging Las Vegas.

We attempted to visit a server briefing but we were ejected by an HP bouncer because he noticed that we were wearing a red badge – red standing for warning, of course.

It was hard to prevent us chatting to sources close to Avnet, Ingram Micro and Tech Data, however, and to sundry HP employees who hadn’t been inoculated. Because these chaps and chapesses haven’t been press trained, we will have to not name them and describe them as “sources close” to the companies. And we can relay the undoubted fact that although folk from the big distributors welcomed Meg Whitman’s pledge to be nicer to the channel, they will believe it when they see it, if you get my meaning.

We hacks didn’t get invited to the Gen8 Petting Zoo, which is a shame. We would have loved to see HP petting the channel. Nor did we learn about the new compact servers (need three pedestals), the future HP Smart Update Manager (SUM), the future HP BladeSystem interconnect and we weren’t briefed on HP’s Smart Storage Futures (power, monitor, internet).

We do know that Synnex is HP’s largest North American distributor, delivering over $3 billion sales every year. It’s HP’s number one distie and has over 45 percent channel share. A Mr Eric Doyle, from the Intel Corporation, delivered the message that Intel, HP and resellers are “better together”.  This Eric Doyle is different from UK hack Eric Doyle, who had a package waiting for him in reception. Confusion arose. The UK’s Eric Doyle was being asked to pay $7 to collect the Intel package. We didn’t see Intel’s Mike Magee there, either.

Dan Forlenza from HP and Aaron Arvizu from Intel impressed on delegates the importance of the enterprise tablet revolution. Those would be HP tablets with Intel chips inside, then. Scott Wiest, from HP, invited the resellers to “ignite new opportunities” with X86 servers and how to migrate IBM and Oracle Sun servers to HP ones, instead.

Ray Carlin from HP told partners that while there have been many predictions of the demise of bricks-and-mortar shops, lots of people still want to go into real shops. As ChannelEye knows only too well, people like to go into shops to eye up the goodies but fewer and fewer are buying there and after they’ve taken a dekko, go online to buy the kit instead.

All in all, the event was a very revealing snapshot of how HP treats its partners.  We were successfully confined to sealed test tubes and shipped out of Vegas with due despatch and without the plague breaking out in a widespread kind of a way.