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Editorial: Policing the channel

Editorial: Policing the channel

Former Tech Pacific boss, Kerry Baillie, would sometimes refer to the distributor's TechLink website as the Resellers' Bible. This wasn't an idle boast; it gave him a sense of pride that even dealers who didn't frequently source product through Tech Pac would use the site as a pricing yardstick because of the depth and breadth of stock it contained.

It stands testament to the strength of the TechLink name and its standing in the reseller community that it was not rebranded when Tech Pac was later acquired by Ingram Micro.

But although it is undoubtedly a valuable tool for resellers and a huge selling point for Ingram, anecdotal evidence suggests the TechLink site has become a victim of its own success. In other words, it seems resellers are not the only ones using it as a way of pricing equipment.

Corporate Express' general manager of IT solutions, Marcus Heron, was particularly vocal on this topic at a recent ARN round table event. He even cited situations where potential clients had told him they had access to TechLink and were suggesting what margin he should be attaching to a sale. As he said at the time, this is an appalling state of affairs.

It isn't a situation that has arisen overnight, and it is difficult to gauge exactly how big an issue it is, but there could literally be thousands of visitors to the site that are doing so under false pretences. So how did they get in? Most likely, it is a combination of several problems that include end-users posing as resellers to open an account; one-man bands supplying to small business on an ad hoc basis to supplement other incomes; resellers passing login details to favourite customers as a sweetener; and the development of two huge reseller [Ingram and Tech Pac] databases over time that have now been integrated but are in desperate need of weeding.

Whatever the reasons, the reality is that Ingram's database currently holds more reseller organisations than actually exist in Australia today. To its credit, the distributor is aware of this and has decided to do something about it now that it claims to have overcome the indigestion of swallowing Tech Pac.

But once it has carried out the review and removed the illegitimate names from its records, what would be the best way to make sure that wholesale pricing is restricted to bona fide dealers from here on in? How many of you, for instance, would support a minimum annual spend or the introduction of minimum purchase frequency?

With margins on so many products in this industry having now been reduced to single figures, it is imperative that wholesale pricing is only available to those genuinely plying their trade as an IT reseller. If that is going to happen, it will require other large distributors to follow the Ingram lead and make sure their dealer lists only contain genuine resellers.

Ingram's decision to give its database a spring clean is a great first step but, unless the other major players in the market take a similar stance, it is likely that many of these end-users will manage to slip through the cracks and open accounts elsewhere.

Brian Corrigan is Editor of ARN. Reach him at brian_corrigan@idg.com.au


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