Dell enhances its channel bona fides

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20 June 2012 | 0

As we all know, Dell’s relationship with the channel has never been simple. Back in the day when Michael Dell was telling the world (and Wall Street) that direct sales was the only way to go in the PC space, there were still plenty of PC dealers (back before they got promoted to computer resellers) selling Dell kit-some of them even had a VAR accreditation with Dell. The VAR thing got knocked on the head after a while but it’s a measure of just how pervasive Dell was in the indirect channel that the decision to kill off the VAR scheme affected around 400 dealers in the UK.

Those were the bad old days, of course. Everything changed just over five years ago in May 2007 when Michael Dell announced plans to formalise its relationship with the channel. In December that year it unveiled the PartnerDirect programme in the US, following it up with a European launch in February 2008.

There are many reasons put forward for why Dell finally saw the light when it came to indirect sales after so many years of publicly preaching the virtues of direct selling but I doubt there are many people within Dell today who think it was the wrong decision. This is especially true now that the vendor has become so ambitious in its acquisition strategy as keeping rigidly to a direct strategy would either have limited the targets it could purchase to direct vendors or result in horrific upheaval as it forced any indirect vendors it acquired to tear up their channel structures.

 

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Anyway, whatever the circumstances of the decision to go indirect, it’s pretty obvious Dell felt it was something it had to do if it was to progress. In other words, Dell was forced to bring indirect partners on board. I think this needs stating because Michael Dell appears to be trying to change the dynamics slightly if this report in MicroScope is to be believed .

At the vendor’s annual analyst event, Michael Dell is reported to have said it was not a question of whether or not resellers were going to have a relationship with the vendor but "a question of how and when". It was notable he framed this comment in the context of the extensive broadening of Dell’s portfolio brought about by its acquisitions, arguing it now had a set of broad and comprehensive solutions. One of the challenges this brings, however, is getting partners for some of those solutions to take on other products in its portfolio.

Michael Dell may well be right to suggest it has become a question of how and when resellers engage with his company, but I believe that’s a consequence of Dell changing its channel strategy (and acquisition policy) rather than any pressure that may have been mounting on resellers to accommodate the vendor. Now that Dell has started buying companies that have channel strategies that rely on resellers and distributors for their success, the logic of selling indirect becomes even more pronounced, inexorable even. This is a good thing for Dell because it will make it much harder for rivals with more established channel structures to seek to undermine its credentials if it is seen to be strengthening them all the time.

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