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EDITORIAL: Go the states

EDITORIAL: Go the states

When you visit a state like South Australia, you're reminded about one of the most unique and unheralded aspects of the Australian channel - regional pride.

From what I can gather, you don't live in Adelaide unless you make a conscious choice to do so. And without degenerating into the usual raft of slurs against the AFL-crazy town, I'd say it's probably not a bad place to live. (It's also tempting to make a comment about the AFL Grand Final, but I won't go there).

Last week I spent a couple of days visiting Adelaide as part of an Ingram Micro reseller event, which also afforded an opportunity to swing by some of the city's well-known distributors, resellers and OEM memory specialist Legend.

It's an interesting market when you consider any serious government work is at the mercy of an entrenched EDS, which owns a massive and well-publicised outsourcing agreement.

When it comes to large corporate deals, local systems integrators and resellers are up against IT decisions typically made at higher levels in other cities like Sydney or Melbourne.

This of course leaves the SME market, which thankfully, according to anyone I spoke to, remains the great gold mine for the foreseeable future.

So on the subject of pride, or parochialism, one reseller made a comment that some might find amusing. "You think we're bad, go to Western Australia."

Western Australia, like South Australia, the Northern Territory and Queensland, is fiercely independent when it comes to IT products and services.

However, the real debate revolves around the logistics of product distribution. Local South Australian distributors like BMS and Hi-tech rely on local business. Their value is derived from a shop in the middle of town where resellers can swing by and pick up products on the way to a customer. Less time between ordering and fulfilment equals greater customer satisfaction, and for the sake of a couple of extra bucks for the convenience, price is not an issue.

The interesting thing to watch now is how Adelaide forms an integral part of the national distribution strategies of companies like Ingram Micro, Express Data and Tech Pacific.

The likes of BMS and Hi-tech will sub-distribute for the national outfits, but compete on other fronts - something of a love/hate relationship I imagine.

Ingram in particular is becoming quite ambitious about its place in the distribution leader board, boasting revenues of a shade over $500 million for this year. That's almost on par with Express Data, but a long way off Tech Pac's $1.2 billion plus for the year.

But remembering Ingram only entered the country a couple of years ago with the merger of ERA and ITG, that's not a bad effort.

So in order to grow, the big guys will to do it at the expense of competitors, which also includes small regional players. And this won't be easy for the reason outlined above. Locals love other locals.

But on the other hand, regional distributors need to make sure they don't drop the ball on service or they'll easily lose reseller faith.

In an era where the Internet is becoming the great focus of distribution excellence, it's great to see that real battles will still be fought along traditional lines. Customer service and loyalty is still the benchmark for success. And if you can commiserate together over both the Adelaide Crows and Port Power missing the finals, then all the better for it. Oh sorry, I wasn't going to go there.


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