It should come as no great surprise to the Victorian channel that Dicker Data is spreading its wings outside of its NSW stronghold in its 25th year of operation. Having announced that it will open a new office in Victoria (as well as in Queensland), Dicker Data appears determined to take full advantage of the place it has been granted in the post-merger HP sun.
Existing Victorian distributors of the HP/Compaq, Toshiba and NEC products that dominate Dicker Data’s inventory may not be so happy, but it is a move that is sure to please many smaller independent resellers. Service levels from the incumbents are already high, but this development will ensure that those standards are again put to the test.
Parochial local resellers have demonstrated repeatedly over the years that they prefer to do business with suppliers that have made an investment in their region. Therefore, setting up a presence in the nation’s second and third largest markets will allow Dicker to break free of its dependence on NSW-based sales.
I also suspect that this move is the result of mounting pressure from its dominant vendor partner (HP/Compaq) to grow sales. When it restructured its channel late last year, the merged HP made it well known to its partners that in order to secure their positions as HP wholesale channel partners, it was not enough for distributors to meet sales targets. They had to devise a plan to grow business.
Dicker Data is and always has been somewhat of an enigma in the Australian channel. It is the last surviving top five distributor to remain locally owned. Many of its old counterparts sold out to international organisations long ago and are at the mercy of shareholders who are only concerned about growth and stock market prices.
Dicker Data’s managing director, Fiona Dicker, is a woman driven by fundamental business ethics such as hard work, a fair go and no-nonsense. By her own confession, the family-owned business is on the market but will only sell if the price is right. She has knocked back many tempting offers that failed to meet her expectations on what constitutes “the right price”.
Meanwhile, buyers are perhaps wary of Dicker’s interpretation of a fair deal because she appears to play such a crucial role in the success of the business. There is plenty of good will that comes with the business but a large portion of it relies on the presence of Fiona.
It will be very interesting to watch the growth of Dicker Data in Victoria and Queensland. My fearless prediction is that the low overhead, high customer intimacy-based business model that underpins the company will see it become a roaring success in the new territories it is exploring. The move will secure the long-term future of one of the oldest companies in the channel. That is good news for its business partners both up and down the supply chain.
Gerard Norsa, ARN’s Melbourne based editor at large, can be contacted at (03) 9690 2933 or email@example.com.