Leading security vendor, Fortinet, has appointed WhiteGold Solutions sole distributor in Australia, cutting Ingram Micro and Distribution Central in the process.
The move unifies two of the most powerful players in the security market - both recorded near 40 per cent year-on-year growth locally in 2012 and are predicting strong growth figures for FY2013.
Globally, Fortinet also impressed recording revenue of $553.6 million for 23 per cent year-on-year growth.
WhiteGold is Forinet's longest-serving Australian distributor, having partnered with the company for eight and a half-years.
Fortinet general manager A/NZ, Vaughan Madeley, said the first reason for the move was that the vendor had too many distributors in the Australian market.
"In New Zealand, we continue to have 2 distributors in New Zealand but in Australia we have three and that is too many.
"When we went and looked at the metrics of our business we looked at the performance of our current distributors, we looked at the go-to-market on them, we polled some of our resellers, and we decided that based on the way that WhiteGold has performed for us we concluded that we didn't need three distributors, we just wanted one.
"And that backs on to the fact we've done a substantial amount of hiring in terms of the A/NZ market, particularly in Australia. We will always continue to transact through our reseller partners but we've got in place a highly structured major account manager model now where we do a lot of end-user in-touch and in the purest sense selling - selling the Fortinet solutions set, value proposition and then working with our resellers we then take that back through any transactions that go through the reseller and down through distribution.
"In summary, when we analysed the whole distribution model over a couple of months, we found that the sole distributor we have appointed gave us the most value-add over all our distribution models. Our go-to-the market operations - from a sales and marketing perspective in Australia - meant we didn't need to have that amount of distribution behind us."
It is a significant move in a significant market. Security is riding a genuinely large wave, driven by heightened conscious of security needs as BYOD, mobile, big data and any number of digital economy initiatives highlight the need for rigorous security moving ahead, and underscored by the government's recently announced $40 billion cyber security initiative.
Fortinet's 40 per cent revenue growth follows its investment in a Regional Support Centre in Sydney, 10-plus staff in sales, onboarding of 500+ certified partners, Xtreme Team Partner training along with sales and technical support, and the introduction of premium maintenance services, including four-hour hardware replacement for major centres.
WhiteGold grew 38 per cent year-on-year in 2012 and was a constant headline maker as it announced several distie deals, established an office and stock holding in New Zealand and took out Solutions Distributor of the Year at the 2012 ARN IT Industry Awards.
"Obviously, it means we'll have a significant increase in the business we'll be doing with Fortinet," WhiteGold managing director, Dominic Whitehand, said. "We've added significant office space which we'll talk about at a later date, we are adding people anyway, and we will be adding significant Fortinet resources.
"What it really means for us is two things: Firstly, we are very strong on 'channel hygiene' - which we can now accelerate even further. This comes from using the hybrid Boomerang LifeCycle Management System that we have in place, as well as the team we have - we are renowned for having extremely well-skilled people, with very little churn in terms of our staff. On top of this there's the experience in solutions approach we have, and the fact that we have been a Fortinet distributor for eight-and-a–half years, making us the longest-standing distie locally."
WhiteGold co-founder and sales director, Jonathan Odria, continued, "This amount of channel hygiene we provide really simplifies things in terms of the go-to-market, and it leads into the second major outcome of this new relationship – the protection of margin for Fortinet partners. There's always a scenario with multiple distributors where there's a bit of price shortening and that kind of thing, a bit of confusion sometimes. Really what this sole relationship means for us, is that we can now actually protect and potentially increase the realised margin that Fortinet partners can achieve.
"Not only do they have a massively strong value proposition in terms of the solution set, but also in terms of the margin available and the win rate."
Madeley said the move to a sole distribution model allowed Fortinet to concentrate on the market, its customers, acquisition and new customers and "on attacking our competition. Having multiple distributors just makes more noise for us."
Fortinet vice-president South Pacific, Kevin Dyson, was similarly upbeat about the move and underscored the importance of WhiteGold's long-term relationship with the company.
"What Dom said about the longest standing distributor is important. That loyalty, that trust, really means something. It mean something to us, it means something to the market place. It is our mission to get this trust and security partner model and message rolled out through our team.
"One of the things we also do to enhance that message is going out and talking to a lot of senior and other partners in the marketplace and they talk a lot about our company and they say 'you are the right size; the right size company for us'. And what they mean are we are not too big - around the half-a-billion mark - that large enterprise can't have an impact on our business. And we're also the right size in terms of being able to be agile when it comes to the needs and requirements of enterprise customers.
"It's the right time to go after enterprise - this is a key message for us. What we're saying is that an upward security model is the way for us to start achieving that goal.
“The appointment of a sole distributor in Australia simplifies our powerful market position in delivering the broadest portfolio of security solutions. Our partners will be able to increase their operating margins under this new simplified and united model. This is a model that provides the highest levels of value to our partners and end users in unity with WhiteGold."