|
|
Spierkel, Ingram Venture ForthDATE: 25-OCT-2007 Spierkel It's a wholly different dynamic in Europe. There're so many things I could talk about there. You've got a situation in Europe where there's much more relationship selling than there is in North America. Not to say that North America doesn't have a relationship and a relationship bias, but there I would say it's a 2x factor of importance weighing on what you do. And that then means people are putting less sophistication or less specialization in place in Europe than there is here, and more of an emphasis of depending on the vendor to some extent and the distribution partner to put the solution together because they're going to work on their relationship, which is their competency, understanding applications. So they're much more focused on that, day in, day out, then I'd say North America is. I would give them credit also on a very different dynamic again. There've been certain competencies that Europe has been ahead on North America and that's everything around mobility. North America is probably two, three years, in some cases more, behind Europe in certain product categories. Take navigation. It's now a hot item here; triple-digit growth if you go to any of the big box retailers or off of the Internet. You're seeing navigation take off and that's just last year, this year. That was on fire in Europe four or five years ago, and people were putting together much more interesting solutions around that, both at a PDA level and at a basic phone level — miles ahead from where North America is in that regard. Why? I think greater use of the phone. There's always been a bigger use of mobile phones in Europe. Much more difficult issues and challenges around languages, reading signage, as people move around, so they're much more comfortable with their own language and not being able to see things visually, which here in North America I'd say is better organized. So it's interesting how infrastructure will influence certain applications or certain solutions sets in one region from another. You could take the story over to Asia, where they're skipping putting in desktops and putting in more laptops and mobility solutions and a wireless infrastructure and not worrying about cabled anything. So a complete step ahead again and a different dynamic. And if I go to India or China and just seeing what we sell and how the buying patterns are over there, they're a little different, again in part because of infrastructure differences that have influenced how IT is being applied or at what rate it's being applied. So it makes for some challenges for us as an organization, but I think our people understand it and, to the credit of the vendor community we work with, the bigger ones that are global in nature understand that, too, and work with us that way. Vizard: The channel's been international for years now but now the business is going global. How does the channel need to respond, how do companies like yours need to respond? Because they're going to see more deals that are going to be … Spierkel: Multiregional or multicountry, potentially at least. Yeah, I would say that challenge still remains out there for everybody. A global deal or a multination deal is still something that I would say the vendor community hasn't figured out and for Ingram Micro is still challenging. Let me explain why. You know, our typical sale is usually in an in-country solution — 95 percent of our sales are in-country globally, so only 5 percent are trans-border where, you know, something's sold here. Maybe a solution for Canada and the U.S., or something sold in Holland could be a solution for three countries in Europe. And where we run into problems is in a, let's say, a platform for Europe, even just going out with a PC solution and a few servers, you have different SKUs for each country because of language issues, because of keyboard differences and because of pricing differences. And ultimately, what is even more challenging is most vendors compensate and reward and drive behavior on an in-country sales basis. So if I was going to go buy all the product for a multimillion-dollar sale in Europe out of Holland but only 10 percent of the sales are in Holland and 90 percent of the sales go to four other countries, the Dutch guy that's getting that sale is licking his chops because he's pretty happy. But he'll have trouble sourcing SKUs from other countries so that's where he needs our help, because he won't be able to buy them in-country for his own operation. And then the in-country guy will get a benefit of the sales. But then let's assume 50 percent of that sale ultimately is, even though it's headquartered in Holland, 50 percent of the sale is going into Germany. The German vendor guy is not getting compensated for the sale in-country because it's being pulled from another place and maybe Ingram is involved with it. And so from that perspective, there're some challenges internally in the vendor community. So I would say the vendors have probably got the biggest hurdle in trying to get to standardized SKUs, standardized price points and common compensation plans that are neutral from sourcing to the selling process. That is something that hasn't been sorted out and squared away. I will say, though, that we do work on a number of large bids and as we go forward I think we're improving our processes where the vendors can give us the rights to work around some of their internal challenges. We've been able to put some good capabilities in place. But you have to work on what I call a certain degree of customized solutions to make that work. It's not a standard practice because sales of a system configuration here in North America, and then you're trying to export that to another country or another region — the SKUs will be different again, product homologation or approvals might not be the same, you have to replace it with maybe another product that's comparable but not exactly the same. All those types of things make for a challenging situation there.
|
|
| Looking to grow IT's role in business? Looking to equip IT with the tools to make a difference? The time has come to for solution providers to increase the importance of IT. Opinion: Margins will drop quickly on managed services, and VARs need to stay two steps ahead to keep up. |
|
|
